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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Tags: Local Search, twitter
Why not just create this with the Twitter API? You just gave someone a great business opp to create a restaurant review site based on Twiiter API.
Right on Steve.
A couple of weeks ago I wanted to find the best place for live Jazz in the San Jose area.
After 15mins searching online I found nothing “conclusive.” I sent out a tweet and got 4 great recommendations within minutes.
Local Twitter is a huge opportunity.
@Brent
Yes this could be done with the Twitter API to a certain extent. But you would basically have to spam Twitter with fake accounts to be able to pick up any responses for @RESTAURANTNAME or ping the Twitter Search API everyday for every single restaurant name in the U.S. which would take a lot of load on your servers and Twitter.
This can be easily done with Twitter themselves as they can set up internal alerts like they have for @USERNAME right now.
Great idea Steve, and I couldn’t agree more. Twitter would do well to hire you (perhaps stock options :)) to implement this solution!
…and this would give two options for Google:
- buy Twitter
or
- reduce their authority in the serps
Krisfla
Thanks Steve. Great theory. I have been curious about this for some time.
Steve, what a brilliant idea. You’re absolutely right about the fact that Twitter could outrank MANY local search portals with these profiles. Distribution / syndication deals could be amazingly lucrative.
Seems to me that they could extend this strategy to any brand, product, service, person, etc. Is that a steak I smell?
It’s amazing how simple twitter seems from the outside but this article has really made me start thinking about how Twitter can be used. I use to think it would be cool just to send out coupon codes. This article has presented a lot more ideas. Right one Steve.
Fantastic idea! Wish I would have come up with it but you are making me think!
i think twitter is still in it’s infancy stage. You can clearly see everyday little changes brewing and it is only a matter of time before this site evolves into a mammoth powerhouse website, even more than it already is.
some websites are already doing something similar by linking user accounts to mobile local activity services like http://www.meetnowlive.com
it’s a mobile social network for bars and nightlife that RT’s real-time location and party data
twitter.com/meetnowlive
Brilliant! I agree with Jeff Twitter should hire you!
agreed this is a practical, useful and thoughtful idea. How would patrons know the twitter @bizname of the establishment they are patronizing? would a location aware list of establishments present themselves as options somehow? interestingly it seems like some folks that are building their own clients on top of twitter like twinkle/tapulous seem to be are already sniffing around this area by layering in their own community elements… agreed that map/location elements might make a very nice addition!
R/t Yelp, so to speak. Nice idea; I meanwhile use Twitter in teh same way. Often faster & more reliable.
I’m the owner of a local search start-up and think this is a great idea. Twitter could do well in local search. Although remember, if a local search has a large audience and have the capabilities already, they can make there own Twitter clone. It is not hard to clone Twitter. That being said, It is very easy to retain your audience and keep them happy. They can use the same Twitter capability on their own local search.
bostontweet.com is great example of that.
What keeps me from putting “I think @[resturant name] sucks. expletive expletive-ing them!!!1!!!” and doing the whole Skittles fiasco?
Just plug twitter SERPs into the top of your google SERPs using a plugin if you want to use twitter as a local search.
This all sounds a bit tenuous - there are already directory sites out there like this.
Maybe the problem with social networks is you just can’t monetise them in a way that lives up to the hype. http://goodadbadad.wordpress.com/2009/04/14/a-social-media-bubble/
Twitter has the ability to replace Yelp and CitySearch in this way because people can tweet while it’s hot on their mind or tongue rather than having to login later and rate or use a slower mobile interface to comment on their experiences. there is always the risk of slander - it’s the nature of the free speech beast.
I’m pretty sure that at this stage, Twitter isn’t really open to letting other people build a business around this kind of offering; their API limits the number of searches that can be performed per hour (100). You can register to be “whitelisted”, which raises the limit to 20k requests/hour, but this is dependent on Twitter approving your application in advance.
We are launching a beta of our service called ‘Flaggpole’ that is in this arena (http://www.flaggpole.com). Flaggpole is a place networking utility that connects people through places that are highly relevant to them. Please sign up for an invitation to our beta!
Sounds like it’s a Yelp page with the addition of real time conversations
Great article Steve. I think Twitter partnering with already established local brands such as Citysearch or eats.com is a great idea to combine all the tweets with their local content. Seems Twitter would be smart to hire someone like you!
Great ideas and great points and things to consider in the comments as well. I find the twist of something to global, expansive to have it’s biggest opportunity through local.
Think differently about customer acquisition. Instead of thinking about picking up customers on a rolling basis think about creating uploading entire yellow page directories. The work this as a pay 4 performance relationship where Twitter gets paid when someone converts on the ad
Think global act local. Twitter understands how to help brands. Oh, and I think Lunch Box is good, but too fattening!