Twitter will start auctioning off keywords, gluing promoted tweets to the top of search results, but won't start pushing out advertising until the end of the year.
The new service is called "Prompted Tweets" and allows a company to pay to have a specific tweet promoted to the top of search results, with a small note saying who's sponsoring the result. Sponsored tweets pushed out to users won't come until the end of the year, as Twitter treads extremely carefully in its search for a proper business model.
Twitter desperately needs some revenue - a couple of content-licensing deals aren't going to pay the bills and the VC cash will, eventually, run out. So come the end of 2010, Twitter expects to be able to push advertising tweets out to users - someone subscribed to a load of travel writers might get adverts for an airline - but for the moment advertising will only appear in search results.
Advertisers bid for a keyword and the winner gets displayed - only one advert per search, so those just following Twitter feeds won't see anything at all. So far so Google, but Twitter reckons it can make things more Web 2.0 by agreeing to pull an advert if it lacks "resonance" with the twitterati.
That "resonance" is measured by the number of people who interact with the tweet such as clicking on a link, replying, or passing the tweet on. If an advert lacks "resonance" then it will be automatically pulled, and the advertiser stops paying for it. The idea is that measuring "resonance" will ensure that adverts are relevant and interesting to the masses, not to mention preparing the ground for the next phase of revenue generation.
That involves pushing adverts direct to people who've subscribed to related topics, and is dangerous ground for a service which has all the stickiness of greased Teflon. Details of the next phase aren't at all clear; Twitter will want to see how phase one works out before explaining how its pushed tweets will be different from spam.
Twitter will have to tread very carefully to avoid offending its fickle customers, who've grown accustomed to getting everything for free. It's one thing to claim you'll only push adverts your users find engaging, it's quite another to actually do it. It's going to be very interesting to see how Twitter goes about the attempt, and if it can pull it off. ®