Twitter Starts Self-Serve Advertising, Partners With AmEx For Small Businesses

February 17, 2012 0

Los Angeles — In a novel move, the popular micro-blogging outfit Twitter inched one step ahead from its beta self-serve ad testing today the company is announcing that it will now open the door for anyone with a credit card to buy ads on Twitter. The chirping company on Thursday formally announced a new partnership with American Express to allow tens of thousands small businesses to advertise on the popular social network.

Twitter, which for years has sought ways to expand its advertising revenue, hopes the new self-serve ad service, which it will first make available to 10,000 AmEx small businesses will commence in late March, before opening up broadly later this year.

Until then, advertisers have had to work with Twitter’s team. Now the company is making alliance with American Express, inviting small businesses to sign up at http://ads.twitter.com/amex, and awarding each buyer a $100 advertising credit to get started placing ads on promoted tweets and accounts for the first 10,000 eligible card members.

Image Source: (Techcrunch.com)

Since 2010, Twitter’s in-house sales staff has sold “promoted tweets” to large businesses on a case-by-case basis. Now, the micro-blogging company is stripping away the barriers to marketing to its 100 million active users. It is doing away with minimum advertising spend requirements and monthly commitments. Until now ads were sold over the phone, with businesses conducted via inter-personal relationships between the company and big brands or their Madison avenue representatives.

With this announcement, small businesses would be able to log into Twitters self-serve system, specify their budget and target geography. Then Twitter will promote Tweets in users’ feeds, and in ‘Who to Follow’ as it now does with big brands like Best Buy and Jet Blue. Small businesses will only pay for performance: Twitter charges when advertisers gain followers or users engage with their Tweets.

This unexpected launch comes at a critical stage in the company’s development and will be closely monitored by investors and analysts inquisitive to see if the company will go public anytime soon.

On the other hand, according to CEO Dick Costolo, who asserts that small businesses have been ‘banging down the door’, begging for access to ads. He states that tests have found that Twitter ads work excellently for small businesses because these companies are already using Twitter–for free–to connect with fans and customers.

Nevertheless, giving AmEx small businesses access to Twitter, should be a win-win-win, says American Express Vice Chairman Ed Gilligan. By securing this deal he is empowering AmEx an advantage over rival services, while his customers get access to an easy way to amplify messages they’ve already been sending for free.

Founded in 2007, the San Francisco-based company lets people send 140-character messages, or tweets, to groups of followers. The company boasts an estimated 100 million active users and a valuation topping $8 billion, even though it has not yet established a money-making model.