Archive for the ‘advertising’ Category

Twitter’s Business Model

April 27, 2010

Twitter has been one of the Internet’s great success stories. It is very popular, the brand has international recognition and three years after its launching it has an incredible traffic: in the first quarter of 2010, 4 billion tweets per quarter were posted. So far, this microblogging service has shared the culture of freedom, participation and lack of profit orientation that characterizes the Internet.

But on April 13, 2010, Twitter announced a plan for including advertising on the site. Some users fear that this decission will “polute” the conversations with “promotional tweets”. On the other hand, the venture capitalists that have backed the company are looking for some returns on their investments. Therefore, the key issue is how to make money without disturbing Twitter’s subscribers to much.

The business model based on advertising could work if Twitter’s managers introduce commercial information gradually. They need to listen to the users: their complaints should be a reason for a quick change about how advertising is delivered. Other media outlets teaches us people’s opinion about advertising: they love it if it is not “excesive”, or “intrusive” and if it is focused to their special interests and consumer behaviours.

Media Companies and Advertising Income

February 16, 2010

The 2009 figures about advertising income in Spain have just been published. Total advertising expenditure decrased 14,8 percent. The crisis have been stronger in consumer magazines (-34,9 percent), sundays (-33 percent) and film exhibition (-26,5 percent). But other traditional media also felt the pinch: tv decreased 23,2 percent, daily newspapers 22,1 percent and radio stations 16,3 percent.

However, the most negative fact for media companies was that advertising in media decreased 20,8 percent while below the line advertising only decreased 9,4 percent. This difference could mean that advertisers are paying more attention to the effectiveness of their ad investments.

Media companies need to be more attractive for advertisers: they should point out to the quality of their audience and the power of their brands and contents to reinforce the commercial messages’ credibility; they should also sell advertising packs through several media outlets (print, audiovisual and online); and they should use more innovative marketing strategies when they deal with possible customers.