Twitter: From Dishing to Deals

From messaging to marketing.

Despite the setbacks and frustrations suffered by some other social media sites, Twitter has moved at a deliberate, some might say stately, pace to build its credibility, awareness and effectiveness.

The fact that marketers are taking it seriously as an ecommerce channel has to do both with the way the site has listened and responded to potential corporate customers. It also has to do with the somewhat unsettled nature of the online marketplace. In an environment in which everyone is trying to figure out what works, any prominent space is going to get a piece of the action, if only for experimental purposes.

The good thing for Twitter is that it is making the most of that opportunity. While 140 characters may not be enough to express oneself, it turns out to be sufficient to get a sales proposition across. And that may be all that's necessary for now. JL

Shira Ovide reports in the Wall Street Journal:

Twitter Inc. is taking center stage in retailers' holiday strategies this year, in a shift from the supporting role that the social-media platform once played during the end-of-year shopping season The change is evident in how Best Buy Co. BBY -2.51%is using Twitter this holiday season. Last year, the electronics retailer bought ads on Twitter to promote sales the week of Thanksgiving, and not much else.

But this year, Best Buy plotted an eight-week Twitter barrage. The retailer has been hosting Twitter "parties"—hourlong blocks for groups of people such as moms or fitness buffs to gather on Twitter and get gift ideas.

Best Buy also bought ads shown to some Twitter users that encouraged people waiting for Black Friday deals to post a joke or a photo of something blue on Twitter for a shot at winning store gift cards. Last month, the retailer also tapped singer Rihanna's Twitter fans to promote an exclusive concert at the Best Buy Theater in New York.

"We know what works, and we're ready to bring a lot of assets to bear" with Twitter, said Alix Hart, vice president of paid and earned media for the Richfield, Minn., chain. She said Best Buy is spending about 50% more on Twitter marketing this holiday season compared with 2011, but declined to disclose underlying numbers.

The shift highlights how Twitter has become too important with shoppers to be treated as a second thought this holiday season. While retailers were among the first corporations to trickle onto Twitter several years ago, they mostly did so to soothe unhappy shoppers griping on the short-messaging service or to supplement TV ad campaigns or other marketing.

Now consumer conversations about holiday deals are flying thicker and faster on Twitter. The San Francisco company said that during the week of Thanksgiving, there were roughly 6.1 million Twitter posts related to Black Friday, or roughly 50% more than a year ago. Twitter said three times as many retailers bought ads on Twitter from January to November this year compared with 2011.

To capitalize, the short-messaging service is pitching a new system to retailers that lets them target ads to Twitter users based on their hobbies or what brands they track on Twitter.

Joel Lunenfeld, Twitter's vice president of global brand strategy, said he flew around the country for holiday-marketing planning sessions with retailers earlier this year. "I've been surprised by just how important 'tone of voice' on Twitter as a signal of personality and authenticity has been to retailers this season," Mr. Lunenfeld said.

Twitter declined to comment on how much revenue it is reaping from retailers. Overall, the company is projected to produce $288.3 million in 2012 advertising revenue, more than double the $139.5 million from 2011, according to research firm eMarketer Inc.

Some retailers said they still don't know how to get the most from using Twitter, or whether doing so translates into purchases. Twitter, with more than 140 million active users, remains dwarfed by other social-media platforms such as Facebook Inc., FB -4.02%which has more than one billion monthly active users.

"If you're trying to substantiate cost per acquisition for a fun Twitter campaign, you're not going to be able to justify the spending," said Brian Magida, online media manager for eyeglasses retailer Warby Parker Inc.

Mr. Magida said Twitter ads are "an insurance policy" to make sure Warby Parker fans see the company's messages amid the flood of Twitter posts. Warby Parker is devoting between 1% and 2% of its holiday marketing on Twitter, with the majority going to Web-search ads and other Internet ads, he said. Warby Parker didn't buy Twitter ads last holiday season.

Cosmin Ghiurau, director of social media for RadioShack Corp., RSH -0.42%says it's not all about quantity. "Even though on other platforms we probably have 10 times the amount of followers, on Twitter the majority of the conversation happens," he said. Last year, the Fort Worth, Texas-based retailer experimented with holiday marketing campaigns on Twitter, Facebook and location-based social network Foursquare Inc. The week after Thanksgiving this year, RadioShack's "24 Deals in 24 Hours" promotion appeared only on Twitter. The retailer gave clues to riddles in tweets for each new product offer, and saw a flood of guesses from people eager to win $100 gift cards.

Mr. Ghiurau said Twitter was a "perfect" way to market its Cyber Monday offers, and he said there was a 1,200% spike in Twitter messages about RadioShack compared with an average day. DataSift Inc., which analyzes the content of Twitter messages, said RadioShack's offers were among the most-frequently shared coupons or offers on social networks during the shopping days surrounding Black Friday.

RadioShack declined to disclose its ad spending on Twitter.

Twitter marketing strategies are working with people like Savannah Pyron. The week after Thanksgiving, the 22-year-old Dallas resident posted on Twitter about her grocery run at a Target Corp. TGT -1.26%store. The retailer replied with a surprise $25 gift card, which spurred Mrs. Pyron to text her family and friends about Target's move and to circulate the retailer's message to her 350 Twitter followers. "Target definitely won me over," Mrs. Pyron said.