Over the last couple months we have heard many different ideas on how Twitter can successfully monetize their surge in popularity, growing user base, and overall traffic. The ideas range from charging for an account, charging for premium accounts, simply adding AdSense, and the list goes on. What we haven’t heard is how Twitter could add local search into their business model, monetize it successfully, and create more user generated content.
When you think about it almost everything that is on Twitter is inherently local. The simple question “What are you doing?” implies that because, unless you are at home watching TV, you are doing something that is local, whether that is local to you or to someone else. The obvious example of this is when you go out to a restaurant and write about that on Twitter, whether you say “Going out to [insert name here] with @stevemcstud” or “Just had a great dinner with @stevemcstud at [insert name here]“. If you simply perform a search on Twitter for “restaurant in”, the point being to see how many people tweet “I am going to restaurant in [insert city]” or “Anybody know of a good restaurant in [insert city name]?” you can see that with just that one phrasing there are tons of results of people talking about local restaurants.
With restaurants being one of the biggest categories in local search as far as traffic and advertisers, it would be easy to roll out a beta test for this to justify whether local would work for Twitter or no. So how do I propose Twitter take advantage of this? Create Business Twitter pages. Just like Facebook, where the page does not have as much functionality as a real Facebook but simply serves the purpose of people being able to connect and talk about a subject. Twitter can simply buy the data of all the restaurants in San Franscico and publish them with static pages so that people can actually say “I just ate @lunchbox with @stevemcstud and it was great!” instead of actual tweets like this:
@dudeman718 could of actually told @SoulPSuperstar where he went rather than a “sushi restaurant in Maple Shade, NJ” and they could of actually clicked on @[restaurant name] and gone and looked at a Business Twitter page. What would a Business Twitter page look like you might say. Like this:
Traffic
With this type of page it requires absolutely no action by the restaurant owner or anyone at the restaurant. Twitter would easily be able to kill it in the SERPs if they structured the business pages into a well done SEO friendly directory which would help users find restaurants in their city. Sooner rather than later you would see twitter showing up for searches like “Restaurants in San Francisco” with all that link juice and fresh content it is no question. This would drive an amazing amount of traffic to Twitter, my guess would be about 4-6 million more visits via search engine traffic with this fully deployed.
Small Business Accounts
Besides the new traffic this would allow business owners who don’t know about Twitter to sign up for it. Business owners always at some point perform vanity searches for their business name, in which Twitter would show up in the results in Google and then they would sign up after seeing all the reviews people are writing about their business. Twitter then could charge for business accounts and then monetize the business account that are not claimed by featuring claimed businesses on other related business accounts that are not claimed, something like a “You Might Also Like” type feature.
User Experience and Advertising
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By implementing this you get a huge double benefit. You get to charge businesses for accounts which would generate revenue. Then you also get to rank the directory by Twitter buzz, allow users to tell other users what they are doing more accurately and with less characters, and create more user generated content overall. With people doing nothing but saying what is on there mind on Twitter, they can easily pass Yelp! as far as content is concerned while keeping their original model as a web app intact and not selling out but rather adding a needed feature, the website.
Partnerships
Partnerships will come flooding in with the likes of Superpages.com, City Search, and others. Twitter will not have to complicate their business with a sales force, but just partner with the giants in the local industry who already have the customers, their credit cards, and revenue coming from what exactly small businesses want, more customers. With traffic coming in from local searches, reviews, and buzz, companies with have to partner with Twitter just to keep up with the industry.
It’s All Bout The Dolla Bills
So how much money can this actually bring to Twitter? The current valuation has Twitter worth about $250,000,000, last time I checked, and that was based solely on the buzz and the amount of users they have on the site. With an estimated 6,000,000 visits a month coming from this program and a majority of them will no doubt be recovery searches (people or business owners searching for business names, phone numbers, addresses etc.) this will get Twitter in the public eye to consumers and businesses owners doing vanity searches. There is no doubt that a percentage of those new visits will end up signing up for the service.
With the current valuations, the actual worth of each Twitter user is debated to be between $73 and $42, so let’s just say $40 to be safe. If only 2% of my estimated 6,000,000 new hits per month actually sign up for the service that will total 120,000 new users every month. So what is 120,000 users worth at the current valuation? $4,800,000. And that number grows every month with new sign ups and new visits. Now I realize that not every single one of the 6,000,000 visits every month will be brand new every time, but without a doubt from my experience of working with Local Search Destination Sites the majority of them will be.
The number above does not even take into account the monthly residual they could make from small businesses that they sign up through partnerships. From pure revenue stand point they can easily get 50,000 small business clients spending $6 per month. So let’s assume that they have a 50/50 revenue split. They receive $150,000 per month and growing residual income from partnerships. Now if we apply the math we did above with each user worth $40 then these 50,000 new paying customers add a value of $2,000,000 to the company as well.
Conclusion
All and all this is what you get:
- A better user experience where you will see tweets like “Just had lunch @LunchBox with @SteveMcStud” rather than “Just had lunch with @SteveMcstud at that one cafe at Google next to the main campus”
- They will increase there traffic generated by search engines by at least 4-6 million per month.
- Business owners will find there pre-made Twitter accounts, take them over, and interact with the Twitter community
- Partnerships will follow with companies that already have the very businesses that people on Twitter are talking about actually paying them money. No sales force required.
- Revenue. You actually have a profitable revenue source that may not be the end all be all model, but will be a huge chuck of revenue that does not interrupt the user experience but actually makes it better.
- A big increase in valuation due to increased revenue, increased user base, and increased market share.
So that is my 2 cents. For all I know I could be completely wrong. Oh yeah, by the way, in the hour it took me to finish this article there have been 65 more people who had “restaurant in” in their tweets.
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