Twitter begins self-serve advertising for small businesses

SAN FRANCISCO Thu Feb 16, 2012 11:01pm EST

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SAN FRANCISCO (Reuters) - Twitter Inc. on Thursday formally launched a service to allow small businesses to buy and place ads on the online messaging platform.

Twitter, which for years has sought ways to expand its advertising revenue, hopes the new ad service will at least partially answer looming questions about its long-term business strategy.

Since 2010, Twitter's in-house sales staff has sold "promoted tweets" to large businesses on a case-by-case basis. The company spent last year developing a self-serve system that could handle a far greater volume of ad transactions and, in November, opened the system to a small number of clients for testing.

Officially launched on Twitter's website on Thursday, the new service is limited to merchants and advertisers who use American Express cards. Twitter will open the service to other cardholders in the coming months.

The rollout comes at a critical phase in the company's development and will be closely observed by investors and analysts curious to see if the company will go public anytime soon.

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

Co-founder Jack Dorsey said in January that Twitter's "business model has been in development for some time and it works.

(Reporting By Gerry Shih; Editing by Matt Driskill)

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Comments (1)
Fourtothe4 wrote:
If Twitter don’t keep a very close eye on the prevalence of ‘promoted tweets’ I think they seriously risk killing the goose that could lay them golden eggs. This could spell a good opportunity for small businesses to promote themselves, but effective use of Twitter can help them succeed without paid ads. Building connections organically is bound to mean those connections are better quality than shoving adverts in people’s faces forcibly surely.

Feb 17, 2012 4:29am EST  --  Report as abuse
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