With Twitter’s ad-based business model now evolving on what seems like an almost daily basis, the company has revealed plans for a big new target: small businesses.
In an article published by The New York Times on Monday, recently promoted Twitter CEO Dick Costolo says the company, “would offer a self-serve tool for local businesses to buy Twitter ads, and is working on ways to deliver those ads based on location,” starting next year.
While that’s not much of a surprise -– a self-service model for smaller advertisers has long been assumed while the company tests its various ad formats with big brands –- the possibilities are considerably more interesting given the way Twitter has evolved in recent months.
For starters, the company now has its own mobile apps on most major platforms, giving it a much bigger footprint to serve location-based ads to users than when “Promoted Tweets” were first announced. It also has additional ad formats like “Promoted Accounts” that make a lot of sense when applied to the local market. Ads can also now be syndicated to third-party apps, meaning Twitter will soon be able to reach nearly 100% of its users with ads.
The New York Times indicates that local businesses would be able to use “clues like whether someone follows a bunch of restaurants in a particular city,” to serve relevant small business ads – an algorithmic approach not dissimilar to what Twitter is already doing for the big brand Promoted Accounts ads.
Such a model also gives Twitter something it’s lacked so far in its advertising business: scale. While the company is reportedly fetching upwards of $100,000 from some of its big brand advertisers for Promoted Tweets, a self-service model opens up the platform to tens of thousands of businesses already using Twitter. In turn, it evolves the company’s business model into something far more robust that more closely resembles that of Google or Facebook.