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How does Twitter make money?

While sites like Facebook and Bebo clearly make money from banner advertising, other social media sites aren’t so obviously commercial. How does Twitter make money when there’s no banner advertising?
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Freedom

Most sites on the web are free to access. You’re not paying to read this article, but we’re running servers and paying staff so money has to be made from somewhere. Most sites get revenue from Google Ads and they have other advertisers who provide revenue which is normally paid on a price per click basis.

Twitter’s advertising model

Twitter has approximately 232 million monthly users but none of them pay a penny to access the microblogging site so the site is reliant on sponsors. Although most reports suggest that Twitter’s run at a loss, the owners are generating some revenue through advertisers. The business model is different to other sites but the outcome is the same. Twitter works really hard to make sure that the advertising on its site doesn't interupt its users but their advertisers still have messages they want to get across. To do this, the microblogging site offers firms several advertising avenues.

Advertising

The first of three ways companies can get their message across is to promote a tweet that appears in people’s timelines. The second approach allows firms to promote a whole account and the third method allows them to promote a trend. Advertisers are charged based on the amount of interaction their content generates so they’re trying to get advertisers to produce attractive content that users are interested in rather than simple banner adverts that carry a brand name or marketing message.

Revenue

If this all sounds a little tenuous and not the sort of basis on which you’d invest your money, you’d be in the minority because Twitter hasn’t found it difficult to attract investors since hitting the stock exchange in 2013. Revenue in 2012 was $317million so there’s plenty of money floating around the social media site.

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