As Twitter continues to mull over how to make money, startups are looking to capitalize on the advertising potential of the microblogging platform. Media network Glam Media is going to be launching a Twitter ad network. And today, Ad.ly, an Los Angeles-based startup, is launching a Twitter-based advertising network to connect high-end brand advertisers with celebrity and high-profile Twitter users. The idea behind the startup is simple: advertisers can pick which celeb they want to Tweet about their product and once the celeb approves the Tweet, he or she will be paid handsomely by the advertisers. Basically, Ad.ly is the middleman between advertisers and the Twitterati. In fact, founder and CEO Sean Rad says that he wants Ad.ly to be the Federated Media for Twitter.
Ad.ly’s platform is self-serve for both the Twitterati and the advertisers. So for example, an advertiser for Dell could choose which celeb or power-user to pitch their ad too and then submit a bid to a particular user. The celeb (or publisher) then approves or denies the request. Once the publisher approves the Tweet, the message is sent out via their account by Ad.ly. Each campaign requires the celeb to send out four Tweets over the course of a week. Here’s a sample Tweet that a celeb would send out. It’s important to note that each Tweet identifies Ad.ly and links to an online interactive campaign for a brand:
So how do advertisers know how well their campaign is doing on Twitter? Ad.ly features a customized dashboard that tracks click-through rates, retweets, and even the geographic location of users who retweet an ad. The startup is also in the process of launching a “machine learning client” product that would identify the makeup of a celeb’s user base and then match advertisers based on the target audience of a brand’s ad pitch. For example, the new technology will determine the breakdown of a celeb’s follower base by gender.
Each publisher sets the price of a Tweet campaign but Ad.ly will give the publisher a pricing suggestion based on variety of metrics. Ad.ly’s proprietary algorithm evaluates follower counts, authority, quality of Tweets and will help determine the Twitter’s value. And when I say that celebs get paid “handsomely,” I mean it. If a celeb has above a million followers, each Tweet gets in the five figures, with multiple Tweets about a product netting the celeb a six-figure reward (yes, for four Tweets!). Ad.ly takes a cut of what the celeb makes, but Rad wouldn’t reveal what the percentage is.
This is an interesting idea and a potentially lucrative money maker if these numbers are correct but there are a few concerns I have. First, will a celeb’s Twitter “authority” be negatively impacted by the appearance of ads within his or her stream? The second issue I have is the whole idea that a celeb will be monetizing off of other people clicking in their Tweets. I’m not sure how followers will react to this, considering many of these celebs are raking in the money as it is.
But Rad says that the ads won’t distort the quality of a celeb’s stream because the Tweets are spread out and sent every two days, and the ad campaigns that are promoted via Ad.ly’s platform are for high-end brands such as Dell, Maserati, and Hilton. He adds that ad-sponsored Tweets are clearly marked by Ad.ly so people can ignore those Tweets if they’d like. As for the monetization issue, Rad says that celebs can opt to donate any proceeds they receive from the campaign to a charity of their choice.
For the launch, Rad has accumulated an impressive list of high-profile celebs who are willing to participate in the network. Celebs include Kim Kardashian, Brooke Burke, Nicole Richie, Brody Jenner, Dr. Drew and Samantha Ronson.
Ad.ly has recently raised a Series A round of funding from GRP Partners but Rad declined to reveal the amount of funding. Ad.ly faces competition from fellow Twitter ad networks Magpie and Twittad.
Interesting concept though after users figure out this is just an advertising link they will fail to click on it.
if celebrities can be paid to tweet, so should regular people. the whole pay-per-post thing was specifically about this. ain’t cool that it’s more acceptable when celebrities are doing it.
Nice post on a growing twitter revenue model and congrats to adly on their website launch!
@nustik: don’t worry, they can via multiple marketplaces. SponsoredTweets.com pioneered sponsored celeb tweets earlier this year, but their marketplace also includes thousands of “regular people” that have built followings across various niches of interest to readers and advertisers. In fact, @spontwts is running a SupaTweeta contest right now for referring influential tweeters (celeb or otherwise) and advertisers: http://sponsore...eeta-challenge/
(Note, in addition to the contest, referrers can earn a % of everyone referred)
Both celebs and “regular people” need to be selective and prudent with their frequency of sponsored tweets, but the right balance can be a win for all.
Ouch. Ad.ly isnt even live & got coverage.
Distorting this market with claims of paying 6 figures for 4 tweets is one of the dumbest things you can do. That only increases the “celebs” perception that this is their new place to monetize their celebrity. Once that happens brands/advertisers will run faster than the little bird that is one the front of http://ad.ly (which still isnt live)
They look live to me. Maybe TC ran the article a few minutes early. Looks really smart.
Smart? Then so are the other ad platforms that have been live for over the last year like AdCause, Twittad, SponsoredTweets, etc. Ad.ly simply ripped their ideas and then threw some celebs behind it.
This only proves one thing, Twitter needs to begin to control this space b/f it takes them down. In a year we will probably see hundreds of ad.ly’s.
To each their own I guess. I’ve been in the online ad business years ago (yeah, techies didn’t love us, but we paid the bills and got people to write/publish). And it’s all about who the publishers are. Getting celebs are your first publishers in smart in my book. From your perspective, all ad businesses “ripped” people’s ideas. Likewise, all restaurants “ripped” the idea of serving food. In this business it’s all HOW you do it.
Ouch, Darren just got served. FWIW, the term “getting served” has been used before; don’t burn me at the stake, Darren.
That is pretty cool I guess.
I am proud to have been selected in the campaign although my celebrity status is indirectly related I am known as the true Hollywood Insider
how did they get so many famous people?????
Mews a shill for “the man”? Unsubscribe.
Huh? Is there a way I can unsubscribe from your comments?
Despite how much people say they hate these networks, and ads on twitter, they do work and people are clicking.
Just from a first glance at the tweeters on ad.ly, they have a great deal of the same people listed on SponsoredTweets. It will be interesting to compare rates, as that’s where the services may differ/win against each other.
This makes perfect sense to me and, personally, think it’s a GREAT concept! (Wish I would have though of it!)
How long are social networks supposed to run on venture capital dollars, before they monetize?
Advertising or some income stream has to come sooner or later, or what’s the point?
Actually, F Press, it depends what your goals are. If your goals are grow, grow, grow, then flip, you never have to monetize. This is not Twittter’s goal as they have no choice but to have an IPO soon.
Oh. You mean Luke Izea did already with sponsoredtweets.com? Nothing new. I’ve uses iZea from an advertiser prospctive. Great concept but nothing new
Selling out is very lucrative. Having your fans think you’ve sold out is not.
This will probably work, but only for non-celebretiy brands, like @cnnbrk.
this is bullshit. Check out my small calculations that i did.
http://robwagner.org
I would become a millionaer with this concept lol
Post your results. I’m not clicking on that link bait.
Like always, the little guys will be excluded from participating because they cannot afford what the big dogs will pay…good idea though.
“Celebs include Kim Kardashian, Brooke Burke, Nicole Richie, Brody Jenner, Dr. Drew and Samantha Ronson”…., Forgive me for being a complete Ignoramus but who on Earth are these people?
If you’re truly interested in knowing who they are, just follow these simple steps:
1) Type “google.com” into your browser’s address bar
2) Type one of those names
3) See instant results
…and your ignorance is forgiven. Those people are only well-known in the US, not sure about world-wide appeal.
I signed up. Site looks beautiful.
Looks like a nice concept – I’ve signed up too.
The question is not what celebrities are on the platform, but what advertisers. Do they really have anyone ready to pony up thousands of dollars to have a celebrity send a paid-for link that everyone knows is sponsored?
Congrats to Sean and team. Site looks great. I signed up as well and donating any funds I receive.
Woah, no way dude are you kidding me! that wild. Tweet ROCKS
RT
http://www.onli...e-privacy.us.tc
Gradually all roads lead to Famebook!