Toy Story 3: The Beginning of the End for Twitter?

Every couple years, as we’ve seen, a new Social Media platform rolls out – one that promises to be more intuitive, more fun, and more useful than it’s predecessors.

Myspace: Yeah, it used to be cool

Myspace came onto the scene SEVERAL years back and represented the first major splash into the Social Media scene – but before long, the new shininess wore off as Myspace became plastered with advertisements, and started offering options that, quite frankly, overwhelmed users. Other than the music scene, most of us don’t find any value in Myspace (I deleted my profile years ago).

Facebook: More trouble than it’s worth?

Enter Facebook – a simpler platform that, at it’s initiation, was focused purely on the college demographic, requiring you to have a college e-mail address to register. Facebook was cleaner, sleeker, and focused on making connections and building online relationships, even if it was connections from the kegger the weekend before with that one girl you barely remembered taking shots with.

Facebook is still huge, but users have been jumping off the bandwagon for some time now. Facebook opened it’s doors to anyone and everyone. I knew it had lost some of it’s touch when my Mom started poking me and inviting me to Farmville every day. The options and applications, combined with privacy issues and the incorporation of Facebook ads led people toward the next best, simpler platform.

Twitter: Less is more, but not anymore?

Twitter Promoted TrendsAnd so we have Twitter. Simplicity in it’s most pure Social Media form, at least to date. No detailed profiles, no photo albums, very few issues with privacy, and literally forcing you to keep your thoughts concise (140 characters is a way of life for many of us these days).

Many of you may have noticed Toy Story 3 popping up in your Twitter stream and showing up in the sidebar with a ‘Promoted Trends’ label (shown on the right). The question is, does this subtle form of advertising signal the beginning of the end of yet another Social Media platform?

The Evolution of Social Media

Twitter is a business – and as a business, they have to make money. The tricky situation is that, while money-making is critical, how can you go about it, how can you make that shift without losing your ‘customers’ in mass quantities? We’ve seen it happen time and time again – is this the natural evolution of Social Media?

And of course, somewhere in there, bloggers start debating about the future and money-making model of Social Media, because, after all, that’s what us bloggers are here to do.

So what’s next?

Here’s what Twitter had to say about the use of Promoted Tweets and what we can expect in the future:

Before we roll out more phases, we want to get a better understanding of the resonance of Promoted Tweets, user experience and advertiser value. Once this is done, we plan to allow Promoted Tweets to be shown by Twitter clients and other ecosystem partners and to expand beyond Twitter search, including displaying relevant Promoted Tweets in your timeliness in a way that is useful to you.

“Relevant Promoted Tweets” sounds a lot like Google Adwords and Facebook advertisements. Yes, they can be ‘targeted’ based on location, keywords, etc – but that doesn’t necessarily mean they’re useful to me – in fact, most of the time they’re not at all.

So where’s the cut-off? What do you see as the future of Twitter and Social Networks in general? How can these companies make money through TASTEFUL advertising? Or is that even possible? Is this rise and fall of one business after another inevitable?

Sound off in the comments below. Looking forward to hearing your thoughts…


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44 Responses
  • Seth Gray Reply

    I wonder if that's just the natural arc for any business? Start with entrepreneurial purity & conviction, where filling the market niche is the goal. Make some money, want more. Then money becomes the goal. Reminded me of a Henry Ford quote: “A business that makes nothing but money is a poor business.”

  • Guardianstar77 Reply

    Concise summary of social media evolution(s) and a very interesting question. I wish I knew the answer. Of course, the simple and honest way for them to make money is to charge their customers a fee and do away with the advertising. If Facebook was to charge each customer even 50 cents a month, how much money would the company earn? Probably not as much as they do from advertising, but it is still worth looking at. Of course, every business has to take care of the bottom line so only they can answer the question and the line must be carefully drawn – I would pay 50 cents or maybe even a dollar a month to use Facebook, but I would not pay more than that. I personally don't believe it is a viable marketing tool, and I certainly CAN keep up with family and friends through (free) Google e-mail. It is easier to ignore all the ads on my Google e-mail accounts than to ignore the multiple marketing posts on Facebook!

  • Tim Jahn Reply

    “The tricky situation is that, while money-making is critical, how can you go about it, how can you make that shift without losing your ‘customers’ in mass quantities?”

    You're asking how companies that make money keep customers? I believe there's a few billion examples of this, like:

    - Apple
    - Microsoft
    - 37signals
    - Home Depot
    - Wal Mart
    - Steak N Shake
    - LA Fitness
    - Western Digital
    - crowdSPRING
    - and on and on and on and on…

    Should you revolve your life around making money? Probably not.
    Should your business make money? Absolutely.

  • Nancy VanReece Reply

    Because the way I use Twitter rarely has me actually going to twitter.com I'm not concerned about promoted tweets .. I mean really – all conversation is sales based … “wanna come to my house and BBQ after we weed the garden?” Is an advertisement for reward in exchange for labor …ha!

  • Rob Reply

    Good holistic look here at what's happening, but what I think will grow is how people interact with these mediums. They'll evolve OR end. All the tools and alternate websites we use to absorb the social media information. Hootsuite allows you to jump on all these social networks and see no ads, or promoted tweets, and manipulate the data the way you want…once a company has a saturated enough base, the “hackers” or the people who find a way out of the crowd start to show up and evolve how we use it, while the core offering stands on it's because enough new comers will still go to twitter.com and feed the marketing machine.

  • Danny Brown Reply

    Business is business. Advertising has been going on for a while on Twitter – either via Izea, or recommended users, or even sales teams promoting their services. The service seems to have survived these “upsets” so far – I don't think this will cause too much of a stir beyond folks complaining about the “death of Twitter”.

    Especially since most folk use a third-party app for Twitter. Unless these ads filter over to these platforms (some of which have ads currently, like UberTwitter for example), then there's even less to get “worried” about.

    Do folks complain about your blog's advertisement of Thesis? Probably not, because it's relevant to you and your readers (you use it, they read your blog from it). Same with Twitter's relevant ads, just a different name. :)

  • LostInCheeseland Reply

    I agree that all businesses need to make money to survive and Twitter taking on advertisers is the easiest way to do so short of charging users for the service which would thereby cost them infinite numbers of clients. I read recently that Facebook is just now starting to roll in the dough in a real, sustainable way – having a brilliant idea doesn't equate to the big bucks right away. I agree though Matt, twitter is the big thing right now but it will undoubtedly be something else in the future. As consumers we get hit with the hottest technologies without even realizing they were in the works for years. It's only a matter of time!

  • Lance Haun Reply

    I don't get this post. Yes, in order for Twitter to keep running, it has to make money. Adwords and Facebook ads are actually very unintrusive ways to do so while keeping user experience very high (and the service free of cost).

    The idea that something that loses money every month is pure while something that makes money is going to go down in quality at some point is puzzling. Honestly, I'd love to know what that rational is all about.

  • DeliverAwayDebt Reply

    As Danny said, Business is business. Since their are so many other ways to get tweets besides twitter.com I don't believe it will be that big of a deal. Myspace and Facebook have a majority of people roped into using their sites, hence slapping everyone in the face with ads. I just don't see that happening yet on twitter.

    If we lose twitter, what's the next” big” social media platform. Maybe we should hop on board and get to work on using the next big thing.

  • Jenn Reply

    Those aren't promoted tweets, they're promoted trends. And I don't see Twitter ending anytime soon, unless they can't make money, which is why they have the advertising. I liked Pete Cashmore's thoughts on this a lot — http://bit.ly/bNBAla

  • Matt Cheuvront Reply

    I'm the last person alive that will label something like Twitter a 'sell out' – I fully understand and appreciate that as a business, the business' goal is to make money. That's not what this post is about. It's not a desperate plea for Twitter to reconsider making money.

    The point I'm making here is related to Social Media companies, and how they can pursue advertising without losing interest from their users – or having themselves labeled as 'sell outs'. Making money is one thing, but you make money on ads based on the awareness level, and when that awareness starts to drop because people are pissed off with ads being thrown at them from every direction, or because of privacy issues, or any other issue – the money from buyers drops.

    So my point isn't that a business should 'not focus on making money'. I run a business, and at the end of the day, it needs to make money just like any other business. Instead, I'm trying to bring to light the delicate balance of making money without losing the interest and faith of your users and consumers.

    We're a long way off from seeing the 'death' of Twitter (Myspace is still alive and kicking, even if you and I don't use it). But, I think there's an interesting discussion to be had from this.

  • Matt Cheuvront Reply

    Here's an example of what a 'promoted tweet' looks like –> http://searchengineland.com/first-promoted-twee

    I believe Burger King tried something like this a month or so ago (I could be mistaken on who the advertiser was). So far, the advertising is subtle, and I agree with a lot of Cashmore's thoughts. I think Twitter is taking the right approach and is pursuing advertising delicately and one step at a time (because they see how their predecessors have gone about it in what many consider to be the wrong way).

    We're not anywhere near the death of Twitter or anything like that…but I also think once they get a taste of success (if these subtle ad placements are successful) it won't be long until we see a much more in-your-face approach.

  • Tony Ruiz Reply

    Interesting points – I wonder what the outcome will be, In my opinion I don't see it being a MYSPACE mess. I think these platforms learned from MySpace and Friendster (if they didn't, shame). However if twitter falls other platform will raise. I guess we will just have to enjoy the ride of social marketing.

  • Tim Jahn Reply

    I agree with Lance – this post is pointless.

    Twitter is a business. So is every other “social media” company, whether they realize it or not. And businesses need to make money.

    “because people are pissed off with ads being thrown at them from every direction”
    Exactly how is Twitter throwing ads at us from every direction?

    They're experimenting with ways of monetizing because they are a business and need to make money.

  • Tim Jahn Reply

    “The idea that something that loses money every month is pure while something that makes money is going to go down in quality at some point is puzzling.”

    Lance, I lOVE your statement here. And it's so true. So many folks in the tech space celebrate companies with flowing traffic, venture capital funding, and become sad when a company starts to actually make money on its own. Never made sense to me either.

  • Jenn Reply

    I'm very well aware of what a promoted tweet is and how it looks. What I was
    referring to was the idea that the image was not of a promoted TWEET, but
    rather a TREND, which is the newest development in the evolution of Twitter
    advertising. I think it opens a whole new approach since it reaches everyone
    and the nature of the Twitter trend inherently indicates that something is
    popular.

    I think that once Twitter gets this taste of advertising success, rather
    than shift into in-your-face approaches, they'll continue innovating new
    ideas. They've already banned in-stream ads and rejected the in-your-face
    strategy, and if they continue to find success elsewhere, they have no
    incentive to move backwards.

  • Matt Cheuvront Reply

    It's a discussion, Tim. And in my mind, there's no such thing as a 'pointless' discussion. Folks are allowed to have different opinions, and it's still not pointless. I don't agree with you, but I don't label you as being pointless. Guess we have a difference in personal philosophy. To each his own.

    I don't see anywhere above where I say that Twitter is 'throwing ads from every direction'. I'm saying that, in the Social Media space there is a repetitive pattern where advertising is tested and then it becomes tasteless and people jump ship (Myspace, Facebook). Twitter is doing it the right way, I think, for now…we'll see what happens in the future.

  • Mary Reply

    Personally I think the problem is less with promoted tweets and other ways Twitter chooses to monetize, and more with quality control. Spam is a growing problem. Just this morning I've had enough spam @ replies to frustrate me and make me consider scaling back my use of the platform.

  • Lance Haun Reply

    I get that there is a balance there but a business' first obligation to its owners, employees and customers is to stay in business. You can't do anything else if you can't manage that so I think money is more important and should definitely be a focus (not necessarily the only focus though).

    Most web advertising is tame compared to what the normal person in the real world is exposed to. These people watch TV without TiVo, listen to regular radio and read newspapers and magazines with advertisements plastered all over it.

    The guy who listens to sports talk radio would probably rather have an hour of uninterrupted sports talk but he also knows that putting together a well produced show with guests and an entertaining host that you actually want to listen to takes money. So that person is willing to sacrifice user experience and time because the content is good enough. If they were willing to pay for a better user experience, they'd go to satellite radio. Most don't though.

    Now if there were a half an hour of commercials versus 10-15 minutes in an hour, would that make a difference? Sure. But I think the impact of reasonable advertising on a normal person's user experience is vastly overstated most of the time. People are okay with companies making money and advertising is an acceptable way to do it.

  • Matt Cheuvront Reply

    Good points, and sorry about the misunderstanding. I like the steps Twitter is taking so far I think they're going about it in the right way and they're showing that they've learned from the mistakes of others in the industry.

    I think the biggest obstacle for someone like Twitter is how to combat third-party applications. I'm very rarely checking Twitter from twitter.com, which makes promoted trends/tweets/etc obsolete. They have a heck of a challenge ahead of them. I've been wondering how they've been going THIS long without monetizing…

  • Matt Cheuvront Reply

    I think that natural progression and evolution to the next shiny toy is something that is inevitable across markets. I'd love to sit down with the founders of some of the companies who have withstood the test of time – especially those pre-Great Depression – who have somehow found ways to re-invent themselves time and time again. Those companies are few and far between, and I'm not sure who will really take hold as the 'Social Media' leader in the market place – there seems to be a thought process that in the future, their won't be all of the individual networks, but rather, there will be one integrated Social Media behemoth – like Twitter, Facebook, Myspace, LinkedIn, FourSquare and so on all into one…It's going to be interesting.

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  • Tim Jahn Reply

    Totally agree, Jenn. Twitter's track record has shown they care more about doing something cool than making money. And regardless of whether or not we each think that's a good/bad thing business wise, I think they will continue to behave this way even when they discover other monetization techniques.

    And yes, Matt, you seem confused as to what a “tweet” is vs. a “trend”. The image you displayed above is a promoted trend, not a tweet…

  • Rachel Vincent Reply

    Two thoughts Matt:

    1. When planning out their social media models, it seems like whoever is planning the “the next big thing” should plan a way to make money into the initial plan. We know that it is critical for a company. And perhaps if the next big social media platform had the advertising factored in from the beginning, it wouldn't be so hard on users later.

    2. With the amount of information that both Facebook and Twitter have on their users, how is it that advertising is still so…well…unuseful? I want to hear about cool promotions. I'm interested in trying new products. And I'd be happy with a company that provided me with that kind of information for brands I would be interested in. In other words, I want the advertising to be useful to me….

  • sameve Reply

    Like Nancy, I don't use twitter.com that much anymore, so the promoted tweets don't really affect me at this stage. I think that, in order to avoid a fate similar to that of MySpace, Twitter has to find a balance between making its advertisers happy/making money, and making sure their users aren't overwhelmed with sponsored material. Advertising has become a more prominent part of the online experience, just as it has in print and on TV. The key is not allowing it to become the majority of the experience, making it difficult for users to enjoy the content they were there for originally.

  • Matt Cheuvront Reply

    Yes, you are correct. That image is of a 'trend' and not a 'tweet'. I have revised the label. Thanks for the heads up, Tim and Jenn!

  • Matt Cheuvront Reply

    I agree Seth – I think this same 'pattern' can be seen across industries. I also think the businesses who get it right, go through a cycle rather than a one-way trend. They get to the point where money IS the goal, but then come full circle and make sure their customers and users are being recognized and appreciated. You can't lean too far in either direction – you have to make money, but also have to make people happy. Running an effective business is easier said than done, eh?

  • Matt Cheuvront Reply

    That's part of the fun right? To sit here and debate the 'what-if's? That's the beauty of blogging and having these conversations. We're not sitting in the board rooms making Twitter's executive decisions, but like you said, it's a hell of a ride to be on and there will always be a 'next best thing' on the horizon…

  • Matt Cheuvront Reply

    I agree with the 'quality control' issue. Twitter is full of spam…but I'm not sure how they can really ever cut all of that out. With that being said, it hasn't gotten to the point of making me want to leave. But again, something they'll have to keep in tune with as the business grows and more users get on the bandwagon…

  • Tony Ruiz Reply

    Indeed Mr. Chevy! :)

  • Matt Cheuvront Reply

    These are great, great points all around here Lance. I don't disagree with you at all.

    Do you think we're more sensitive to online advertising because this is the space that we're supposed to 'get away' from the commercials, the magazines plastered with ads, etc? Is that why there's a hesitation for me to put up ads all over my site? Or heck, even why I wrote this post? Because the minute we sense it, we're quick to say a business is selling out?

    I think so – I think that my writing this post when Twitter has 1) Done nothing wrong and 2) Is actually going about it in a pretty tasteful way – illustrates that we see our online experience as 'tamer' in comparison to where we spend the rest of our time.

    You're giving me a lot to think about…

  • Matt Cheuvront Reply

    You raise a very interesting question. I wonder how a platform like Facebook or Twitter would do if they started charing for membership. Even at very nominal fee – a ton of money could be made. The question is, what free option would be waiting right around the corner? The argument could be, you get what you pay for, but I'm surprised someone hasn't come out of the woodwork and developed 'premium' social network that's taken off…

  • Matt Cheuvront Reply

    I'm with you – I think this is a huge obstacle for Twitter to overcome. With SO MANY third party apps, traffic to the actual twitter.com site will continue to decrease. Will we start seeing applications such as TweetDeck/Hootsuite advertise? Then that opens up Pandora's box for them to create premium “ad-free” versions of their software…an so the cycle continues…

  • Matt Cheuvront Reply

    Point well taken Danny. This post isn't me (or at least wasn't my intent) pointing a finger at Twitter and saying 'shame on you'. Quite the contrary – I'm surprised they have gone THIS long without entertaining more advertising avenues. As I responded to another commenter – the third party service situation is a real challenge for Twitter, unless, as you said, these advertisements extend into those or if applications like TweetDeck release free versions WITH ads and premium options WITHOUT (which is entirely possible and potentially profitable).

    As with every market, there's going to be change and evolution – I'm excited to be along for the ride for what's next in Social Media. Cheers!

  • Matt Cheuvront Reply

    Lance makes a great point above about the web being more 'tame' than other mediums (commercials on TV, ads littered in newspapers, etc). And I think because advertising isn't EVERYWHERE (although it's quickly getting to be that way) – or at least it's easier to “opt out” from ads online – we're more sensitive too them and quick to jump the gun wen we sense the slightest ruffling of feathers. We're a ways off from Twitter becoming obnoxious with advertisements, but I still wonder if that's where we're headed…

  • Jennifer Barry Reply

    Hi Rachel, I agree that Facebook has done a poor job targeting its ads. You can give feedback on the ads so that you get more interesting/less obnoxious ones.

  • Jennifer Barry Reply

    Hi Matt, I like your description of the evolution of social media. I agree with you that MySpace lost its market share because it became too overwhelming and confusing, as well as downright ugly and loud.

    I don't know that I would stick a fork in Facebook yet. As far as I know, the protest was a failure. One of my friends who quit in a huff came right back because it was so useful to contact all his friends in one place. Frankly, I think Facebook should have a premium subscription model which allows you to have extreme privacy and no ads. I would pay for that. Others who don't care can use the free version.

    As far as twitter goes, I don't think the ads are a bad idea as long as they are not popups or obnoxious in any way. After all, people already use it to promote their business directly or by paying others to talk up their website/product. Sometimes I do want to buy something and I want to be marketed to :)

  • eagles11 Reply

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    As a therapist, mentor and writer I have only recently began to explore the world of social media and how it can apply very specifically to the world of private practice for counselors.

  • Matt Cheuvront Reply

    It's an interesting point you bring up – and obviously I don't know what's happening behind closed doors when a new Social Media platform is being developed, but it seems like there is very little consideration in the overall money-making model of the business from initiation. Time and time again it seems that advertising is an afterthought that sort of comes out of nowhere. Maybe there wouldn't be so many people jumping ship if they knew what to expect from day one…

    I think that Facebook is/can be useful – you have the ability to target people based on what they put in their profile. While I've NEVER clicked an ad in Google, I have clicked ads on Facebook several time (typically deals from TicketMaster or something similar for % off of concert tickets when one of my 'favorite bands' is in the area. It CAN be effective, but overall I think there's a general reluctance in all of us to click on any advertisement.

    Advertisements are synonymous with spam in our psyches, even if that isn't the case. It presents a huge obstacle for advertisers to overcome…

  • Matt Cheuvront Reply

    I agree that Facebook is far from dead. People may be jumping ship, but it's not going anywhere for a long time – and I still believe that it will be THE 'social network' as we move into the future – we're moving more and more towards one integrated platform rather than all of these segregated platforms.

    I wonder how many others, like you, would pay for a premium Social Media platform? What would you want to see that isn't currently available? Extra features? No advertisements (obviously). Curious as to what you (and others) think a 'premium' SM model would look like…

  • Jennifer Barry Reply

    Thanks for the clarification, Matt. Personally, I would like Facebook to stop messing with my privacy settings. I would also like it to be more customizable. I have a business page and it has 10% of the options that a personal page does. Facebook won't even tell me if I get a comment – I have to manually check. I think it's dumb that a lot of blogs have a way to chip in, but there's no way for me to give Facebook any money unless I advertise.

  • Matt Cheuvront Reply

    See this is tough (in regards to the options thing). I'm with you that some of the options (or lack there of) don't really make sense. But I think if they go TOO crazy with options, we'll have another Myspace on our hands. Myspace was cool until everyone had their playlists, glitter backgrounds, yadda yadda yadda. You give someone an inch and they take ten, you know?

    It's pretty hilarious how much structure we need – even if we don't care to admit it…

  • Jan Shipley Reply

    I am so sick of advertisements showing up everywhere I turn, especially when I have to take the time to close them before I can see what I even came for.

    Never was part of Myspace but I too quit the Facebook scene as it has become a 3 ring circus and I no longer wish to be a part of that.

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