This article was published on June 7, 2012

Twitter is finding success with monetizing mobile and Facebook should be taking notes

Twitter is finding success with monetizing mobile and Facebook should be taking notes

Much of the cause for trepidation heading into, and of course immediately after, Facebook’s IPO, the big question was how the company was going to monetize its growing number of mobile users.

According to Reuters, Twitter’s CEO Dick Costolo says that his company has no such problem.

Costolo spoke at a conference put on by the Economist Group in San Francisco today and shared some interesting information. Namely, Twitter’s mobile ad revenue had surpassed its Web offerings on many days last quarter. That’s pretty impressive.

Here’s what Costolo had to say about Twitter’s mobile success:

We’re borne of mobile. We have an ad platform that already is inherently suited to mobile, even though we launched our platform on the Web and only started running ads on mobile recently.

It makes complete sense that Twitter does well on mobile devices, since its characters are limited to a smartphone-friendly 140 characters. In addition, the company has made its ad units blend in nicely with the rest of the content we see on the network. Paid suggested users to follow, tweets, and hashtags fit in perfectly and don’t jump out at a regular user as an “ad”, as Facebook’s web ads do.

How can Facebook capitalize on by watching how Twitter handles its ads? There’s no doubt that the Open Graph has become a goldmine for engagement, and putting an actionable dollar amount on all of the actions we’re streaming to the News Feed, Ticker and Timeline might be a way to start.

If I listen to a song on Spotify, perhaps you can click through and pay for an account yourself, with Facebook getting a cut of the action.

While this doesn’t mean that Twitter is making more ad revenue than Facebook is right now, it has nowhere near the 900M users that Facebook does, it does mean that the company is on a better path to becoming a profitable company than we might have previously thought.

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