Twitter rolls out suite of direct response ad products after struggles

The Twitter logo is shown at its corporate headquarters in San Francisco, California April 28, 2015. REUTERS/Robert Galbraith

SAN FRANCISCO (Reuters) - Twitter Inc TWTR.N rolled out three new products for its direct response advertising on Wednesday, two months after the company said weak demand for the product had lowered its revenue forecast for the year.

A select group of advertisers that Twitter declined to name is now testing the products, which are aimed at improving user engagement with direct response ads, intended to encourage actions such as clicking on a link or downloading an app.

Some advertisers will be able to showcase apps within a video ad, which many studies have shown is more effective and engaging. Through video ads, users are able to better understand how an app or product works before downloading it, said Richard Alfonsi, Twitter’s vice president of global online sales.

Previously, advertisers could only showcase their products through pictures.

Advertisers will also have more options about what types of user actions they choose to pay for.

Rather than paying whenever a user clicks on a link, for example, advertisers can opt to pay only when a user downloads an app or installs the product advertised. They can also bid for advertising space by saying how much they are willing to pay for someone to install their app after seeing an ad.

Earlier this year, Twitter said its direct response ads did not produce the revenue expected and subsequently cut its full-year revenue forecast by about $200 million. The microblogging site said it hopes the new direct response products will convince advertisers to more heavily invest on the platform.

The products are still being tested but Twitter said it expects them to be available to all advertisers within the third quarter.

One year ago, Twitter launched mobile app promotion, which enables advertisers to pay for their ads to appear on apps that Twitter has partnered with, such as gaming and ride-sharing apps. Alfonsi said the company is working to expand this offering to more advertisers in the coming weeks.

Reporting by Yasmeen Abutaleb; Editing by Leslie Adler