5 Ways to Make Money on Twitter

Posted on September 10, 2012

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What, in 140 characters or fewer, is Twitter?

Well, it’s a money-losing website made up of very short messages (like this one) where your kids (and C-list celebrities) waste time.

It’s also a popular new medium—tens of millions of users and counting—that businesses use to build brands (and sometimes destroy them).

All this you know. Or you should. But Twitter isn’t just about buzz: Some companies have figured out how to use it for old-fashioned things.

Like, you know, making money. Here are five strategies. Click on each of the bubbles, below, to learn more about them. And please, RETWEET.

Turn Followers Into Creators

| Inc.magazine

The company: SkinnyCorp, which owns online T-shirt retailer Threadless. Based in Chicago and founded in 2000, Threadless sells an estimated $30 million worth of graphic T-shirts a year by soliciting designs from a community of hundreds of thousands of amateur designers, who then vote on their favorites. Threadless bases production on the shirts that get the most votes and pays the winning designers $2,000.

The idea: Threadless CEO Tom Ryan and founder Jake Nickell thought that Twitter messages, because they are pithy, might work well as T-shirt slogans. In May, Threadless created a website that made it easy for the company’s Twitter followers — at the time, there were 490,000 of them — to turn their favorite tweets into shirts. Users log on to a Threadless website,enter their Twitter username and password, and then submit tweets for consideration or vote on other people’s tweets. The winning slogans get printed on T-shirts and sold for $18 each. “We figured if we built something on top of Twitter, we’d drive participation really quickly,” Nickell says.

The result: Nickell was right. In its first five months, the Twitter experiment attracted 100,000 submissions and 3.5 million votes. So far, the company has printed and sold 23 designs — “I’m huge on Twitter” and “Iowa: Cooler than California Since 2009” are the two most popular — resulting in hundreds of thousands of dollars in additional revenue in the first five months. The promotion also helped Threadless add one million Twitter followers. “That’s not bad for a brand-new product,” says Ryan, adding that the Twitter Tees program also provided a revenue boost to Threadless’s core business, as Twitter followers often stick around to buy other shirts.

How to get retweeted, Part I: Ask your followers for help — and give them prizes when they comply. Nickell says one of the company’s most successful tweets came when it offered Twitter followers a chance to win $100 if they passed along the news of a $9-per-T-shirt sale to their friends. The contest became one of the most popular topics on Twitter that day.

Sell Products on Twitter

The company: Woot, a $164 million online retailer based in Carrollton, Texas. The company operates six online shops that sell deeply discounted products — say, a cheap GPS device or a case of wine. Each Woot shop sells only one product at a time, for one day only.

The idea: One of the first retailers on Twitter, Woot uses the service to tell its customers what is on sale that day. Tweets go out at midnight to the company’s 1.5 million followers. “We used to say that there’s a ton of people who’d visit Woot every day if they thought about it,” says Dave Rutledge, who helped his brother Matt start Woot in 2004 and who now runs its creative efforts. “Twitter can help trigger that.” Once Woot has sold 90 percent of its inventory for a particular product, which can often happen in just a matter of hours, Rutledge sends a follow-up tweet to alert potential buyers who may be sitting on the fence that time is running out. “That shows people that the item has been approved by the community,” he says.

The result: Tens of thousands of people click on Woot’s Twitter links every day, and during the company’s rapid-fire sales, or Woot Offs, Rutledge estimates the number is in the hundreds of thousands. Conversion rates — that is, the percentage of users who go on to buy something — are substantially better than the site’s average. Since Rutledge introduced the Twitter stream in January 2007, annual revenue has more than doubled.

How to get retweeted, Part II: Keep messages short. Twitter limits messages to 140 characters, but if you want to get people to tell their friends, it helps if you give them room to add a brief comment of their own. One recent example: “RT @woot: $19.99 : Samsung Bluetooth Headset WITH $20 mail in REBATE!!!!! http://www.woot.com < pretty awesome, just pay 5 bucks shipping!!” For Rutledge, the magic number to ensure lots of retweets is 110 characters or fewer.

Look for Leads on Twitter

The company: Rose Associates, an 80-year-old real estate marketing and management company based in New York City. Rose has 200 employees and manages some 20,000 luxury apartment units.

The idea: Bob Scaglion, Rose’s senior managing director of residential marketing, uses Twitter’s search function for lead generation, which works well, because people often send messages about apartment hunting travails. “Our clientele is young and upwardly mobile,” he says. “Twitter is where they are.” The easiest way to find customers who are looking for what you sell is to go to search.twitter.com and start typing in keywords. Rose uses 10 key terms, like New York City apartments, moving to New York City, and no fee rentals. When a person uses one of these phrases, someone in the company’s marketing department sends a reply message like the one above with a link to Rose’s apartment listings. Unsolicited messages from strangers might sound creepy, but such is life on Twitter.

The result: No followers? No problem! Rose has only 200 followers on its Twitter account but generates 100 leads a month by sending a few targeted replies every day. Scaglion says roughly half of those leads convert to actual rentals, which is pretty good, given that the program costs almost nothing.

How to find leads faster: There are dozens of Twitter applications that can continuously search Twitter and alert you when a keyword is used. Scaglion’s company uses an application called TweetDeck and a Web service called DemandSpot, both of which are free.

Sell Products for Twitter

The company: Atebits, a Philadelphia-based software start-up that makes a $2.99 iPhone application called Tweetie

The idea: Twitter doesn’t charge users to send and receive messages, but that doesn’t mean people won’t pay for an app that makes it easy to use on the go. Atebits’s 25-year-old founder, Loren Brichter, set out to build a Microsoft Outlook for the 140-character set. “Twitter is like e-mail,” Brichter says. “The vast majority of people use it for superficial crap, but a small percentage use it for something useful and powerful.” Brichter put the first version of Tweetie up for sale in November 2008. To promote it, he sent a message to his friends on — you guessed it — Twitter.

The result: Tweetie is the most successful iPhone app for Twitter and has been purchased by 12.7 percent of all Twitter users, according to Twitstat.com. When Brichter released the most recent version, it hit the top of Apple’s bestseller list within 36 hours, ahead of popular titles such as Electronic Arts’s Madden 2010 and CNN’s iPhone app.

How Twitter applications work: Twitter allows anyone to create and sell software that incorporates, organizes, and rearranges tweets in real time — for instance, by collecting messages written by professional athletes (an app called Twackle) or translating tweets into the language of the high seas (an app called Post Like a Pirate). So far, Twitter has stayed out of the app business, preferring to let software developers and entrepreneurs add functions as they see fit.

Find Customers Anywhere

The company: Kogi Korean BBQ, a year-old Los Angeles start-up that operates four roving food carts. The grub is Korean-style meat served in Mexican-style flatbread. Dishes include Korean short ribs tacos ($2) and spicy pork quesadillas ($7).

The idea: Kogi uses Twitter to tell customers where its trucks are. Except for a few regular spots—like Little Tokyo on Thursday nights—the trucks move every couple of weeks, and managers will sometimes make a last-minute change if the trucks can’t find a good spot to park or if the location seems deserted. The idea is to cater to a larger customer base than would be possible with a few regular locations. “We realized that if we wanted to move around a lot, we needed something like Twitter,” says co-founder Alice Shin. Customers—some 50,000 so far—sign up to follow Kogi’s Twitter feed and get updates about locations, as well as specials and random jokes from Shin.

The result: Extremely rapid growth. Kogi now employs 60 people, up from just four a year ago. “We’ve gone from selling 30 pounds of meat a day to 1,000,” Shin says. At any given time, about 10 percent of the customers learned about the location of the truck from Twitter. The rest, Shin says, “see the line and assume it’s good.” And if nobody seems to be interested in buying, the truck can always go somewhere else.

How to get retweeted, Part I: Don’t shill, and don’t spam—or your followers will revolt and stop following. Companies sometimes hire Kogi’s trucks for promotional events and then ask Shin to fire off an advertising message to Kogi’s followers. Her policy is to decline these requests. “If you spam people with advertising, it’ll backfire in the end,” she says.

Max Chafkin, INC Magazine

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Posted in: Social Media