So, Twitter’s in a hole. User growth stagnant, stock price plummeting, laying people off, swirling questions around how/whether Jack Dorsey can fix things.
Herein, we offer a proposal for how Twitter, with a very modest effort, could monetize (almost) the entire Internet, gain enormous goodwill, juice their earnings, help save journalism, and help motivate new usage of Twitter. Get the Street Off Their Back while they fix other stuff.
If you ask the average person what annoys them about the internet, you’ll mostly get the same answer: ads. But ads are the way internet content businesses get paid. The “subscription” model for content hasn’t caught on, because the cost barrier is too high. Most people don’t want to commit to $10/month for access to a website, with so much “free” content out there. Twitter has the opportunity to become the defacto Content Subscription service.
Suppose when you Tweet an article you like, Twitter offers you a choice. Just tweet your link as usual. Or, make a small payment ($0.50?), tweet the link, and in return your browsing on the source site is ad free for the next month. Tweet out that Esquire link about how make a Martini, pay your $0.50 and your Esquire viewing is ad-free for the next month. Twitter keeps $0.25, gives $0.25 to the source site, and the source honors the “ad free” pledge for a month, via a cookie or something. Twitter could even distinguish between a “like” (a free tweet) and “love” (an article/tweet I liked so much I was willing to pay for it). And as more people learn they can do this, they’ll tweet more, generating distribution and viewers for the Publisher’s content.
This is the “tip” model of content monetization. Or “micro-Freemium”. Call it the Twitter TwipJar. It’s a win-win-win. Twitter gets $0.25 and enormous goodwill, the publisher gets $0.25 (vs about $0.0015 for an average monthly visitor, per below), and the consumer gets a wonderful ad-free viewing experience.NoiseTrade is doing interesting business this way in music and books, for artists, as an example proof-of-concept.
Now imagine the Twitter ad campaign: “An ad-free internet, brought to you by Twitter”. Twitter would be hailed as a conquering hero. Or — “Help the brands you love stay alive with the Twitter TwipJar”. Twitter wins.
People tweet about stuff. TV shows, events, sports, news articles…. content. 95% (99%?) of people only consume content, they don’t produce it. What’s the single most irritating thing about content? Ads. Ever try to read that stupid BuzzFeed article with a dozen ad flashbombs going off like an old Myspace page? Of course you have. And god help you if you’re trying to do that on your mobile phone on the train.
Why are all these web pages so loaded with ads? All those mid- and low-tier content sites are trying to stay alive in a world of “free”. But it’s hard to generate enough revenue by ads to survive, unless you grow to enormous scale.
The single most common irritant people express about the web is ads.
And it’s not that great for businesses either — here’s why:
- CPMs are Terrible
- The UX Impact is Terrible
- The Impact on the nature of content itself is Terrible
CPMs are Terrible
Your average mid-tier website is lucky to get a $1 CPM on run-of-site ads. (CPM = Cost Per Mille, or the revenue per 1000 views of an ad). If you’re ESPN or Huffington Post, you can charge a higher CPM. Everybody else, not so much.
Let’s do the math on ARPU (Average Revenue Per User), to see the challenge. Let’s say your average visitor views 1.5 pages per month (most web traffic is “fly through” — read a page then leave). Then ((1 user x 1.5 pages) / 1000) * $1 CPM = $0.0015. That’s right. A visitor generates a tenth of a penny in revenue. 100 visitors yields $0.15. Not sustainable for long. That’s why most mid-tier websites eventually disappear, unless they grow fast or find another revenue source.
UX Impact is Terrible
Mid-tier publisher sites are usually buried in ads. To the point that the content itself is often near invisible, or inaccessible. (and on mobile devices, even slower!). Exhibit A, below: it’s pretty hard to find the “actual” content (vs. the ads) and the UX controls in this page:
And in fact, in the page below, it’s arguable whether the “content” is even any better than the ads.
But you knew that. Ads suck. They create perverse incentives (who’s the customer? The reader, or the advertiser?). (That’s why, at The Hawaii Project, a personalized book discovery engine, we show no ads and are pursuing a “freemium” business model. The reader is the customer.)
If you want to get rid of ads, you have a limited set of choices. Pretty much the only one is to charge for your service — either with a paywall (as newspapers have experimented with in various forms), or via “Freemium”, having a free product plus charging some users a fee for access to advanced features.
But many sites, especially content-rich sites that are basically blogs in some form, don’t have an easy way to create premium features. And they don’t have a lot of developer resources hanging around.
What do they have? They have a “Tweet” button on most every page on the internet. The Twitter TwipJar gives them an easy way to monetize more effectively and provide a better user experience, and Twitter does the work!
More broadly, ad-driven Journalism is a race to the bottom. Lower cost content spun to generate more outrage, more titillation, more holier-than-thou, more page views — rather than content that is of sufficient quality people want to share it, and pay for it directly. A Twitter TwipJar might be the way to fund high quality content via frictionless micropayments. ($0.50 might be great for Bleacher Report but not enough for the New York Times, so Twitter might implement variable tipping, to allow big brands to define the tip size required to trigger the ad-free.)
This is an “everybody wins” scenario:
- Consumer gets: An entirely optional ad free experience and the happiness of supporting a brand they love, while enhancing their own personal brand by tweeting interesting stuff and doing what they’re already doing.
- Publishers get: Extra Revenue, User Happiness, Content distribution via Twitter. And with a small effort (just need to allow for an ad-free experience — cookies plus some modest site changes)
- Twitter gets — extra revenue, enormous goodwill as the company that saved Publishing and Killed Bad Advertising, and more users (as people learn they can use twitter to get rid of ads). They could even hand out “badges”, similar to Facebook “likes”, for brands the consumer supports.
Twitter already has access to an enormous slice of the internet via the Tweet button. They wouldn’t have to field a giant sales force to distribute this, just work with what they have already done .To implement this, Twitter would need some kind of near frictionless micro-payments. But seems like Square (Jack Dorsey’s other company) knows something about payments and credit card processing.
And, in the same way that Facebook became the de facto authentication system of the web via Facebook Login, Twitter could become the de facto Content Subscription service via the Tweet button.