UPDATE: I had originally written this specifically about MLM spammers, but in the end it’s spam that puts twitter at risk. Twitter is a small company 20+ people with some great funding but no real revenue model yet. As we see spammers and hackers have an incentive to use twitter for very destructive exploits and if they have even a minor ROI they will continue to try to exploit this. Twitter on the other hand is going have to invest money in fighting these exploits when IMHO money could be better spent on creating a sustainable business model. I had proposed in a later post that some kind of business model where people were charged based on the number of people who you follow, but another option could also be to charge people to send DM’s. Even a charge of $10 per year to send some number of DM’s would kill spam dead, it only works if there is no incremental cost for sending messages.
more animals
This post is the culmination of a long experiment with twitter and I have bad news for twitter, MLMs (multi level marketers) will kill it and so will anyone else with a business model that can extract value from exponentially growing network… so any blogger.
So I’ve built up quite a following on twitter, mainly due to my popular T-Shirt blog Tcritic.com and as of two days ago I had 1,800 followers on twitter. Now that’s a pretty respectable number but of course pales into comparison with people like Scoble who has 45,000 followers, and Garyvee with 25,000 followers, or Kevin Rose, founder of Digg with 77,000 followers. And forget about it when Twitter gets mainstream which it will as soon as kids realize Brittney is on there with 10,000 followers and sports fans realize Shaq is there with 18,000 followers . Anyway, the point is i’ve got a pretty small network compared to these guys.
So a couple of days ago I saw a tweet about a competition to win a gift certificate for KMART, all you needed to do to enter the contest is RT (retweet or rebroadcast) that message to your network of followers. Simple idea, so I tried it using $25 Threadless gift certificates (I get $3 to spend at threadless every time I send them business and I don’t need more T-shirts) and posted this (note that I included my name in the message so people would rebroadcast that:
@karllong is giving away 10 x $25 gift certificates for http://threadless.com – just RT this to enter, will tweet the winners
I then had another window open at search.twitter.com searching on my name and watched as people rebroadcast the message, again and again and again. In the end the message was rebroadcast by 500+ people to their networks. The first person to RT this message was CoryObrien who has 1,200 followers so I almost doubled my reach with the first step. From an impressions or click through standpoint I have no idea the actual conversion rate, I had included a link to threadless.com in my original tweet and chose to leave the url long so people could see what the link was.
Luckily I do usually shorten my url’s that I post to twitter using cli.gs because I get ongoing metrics on my links I share and my click through rate is well over 2% for just general FYI links I put out there.
Another interesting aspect of this is that through what was essentially spamming my network with an “offer” I added about 250 new followers, so I increased my network and influence by well over 10%. Those are some pretty good numbers, so I got 250 new followers for $250, and they are also people who like TSHIRTS so will be open to more offers in the future (don’t be scared i’ve grown my network with integrity and substance so i’m not planning on strip-mining my network, I want to create more value 
So on to the MLM, well apparently my recent 10% growth in network attracted a deluge of new followers who were not human beings but actually spam bots all promoting a video of Mike Dillard who was going to sell me some “marketing secrets”. And guess what, that spammer is also on twitter and he’s got twice as many followers as me, even his spam bots are getting connected and following each other and gaining perceived influence. Seriously, he doesn’t have any marketing secrets except how to make money from an exponentially growing network. Twitter defeats regular spam accounts with ease, but it’s going to have a much harder time defeating ‘profitable networks’ of people that move in. I imagine with the economy the way it is MLM is looking like a viable option for a lot of Americans.
The problem with spam is that it only needs an incredibly low conversion rate, and some UC Berkley students found out when they hacked the storm botnet it does have a conversion rate.
So what should the Twitter business model be? well IMHO it should be a mechanism to help people value their network, give them a personal rate card essentially so companies can see how valuable and connected some of these people are and let them work with companies they love and believe in. Surely Patagonia should be sponsoring Richard Branson on his latest voyage where he’s live twittering from his boat (who BTW rewarded his 2,000th follower to spend the day with him). Anyway, you get the picture, you could add pro-accounts, real metrics on conversion rates, reach and influence, and who you influence.
BTW not for nothing, but John Battelle with 4,500 followers (author of the book Search) the other day tweeted this:
I can say this: Google is very, very focused on indexing Twitter. VERY FOCUSED. http://snurl.com/774g5 [www_google_com] 5:40 PM Dec 4th from web
johnbattelle
and I can concur if you do a search for karllong is giving away 10 x $25 gift certificates for http://threadless.com – just RT this to enter, will tweet the winners
That was only two days ago!
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Twitter is still very much evolving as a platform, as a tool and as a dynamic. Our user usage of the tool is evolving, as are marketers, as is google. What’s most interesting about this experiment, is the extent to which we are actively participating in deciding and determining the etiquette, rules of usage and rules of the road in this dynamic. In 10 years from now, I don’t know that we will be on Twitter. But I do know that Twitter will have been an impactful experiment. And the world would not be the same without it.
This was a very interesting experiment with actual empirical data behind it that clearly demonstrates that there are ways to [overtly] monetize sites like Twitter by playing the numbers game. It also represents one of the ways in which Twitter could evolve, or more accurately, the direction that could be forced upon them with the increasing number of MLMs infiltrating the network in epic quantities.
But the problem with a model based purely on the trite, old ‘cast a wide net’ paradigm is that, while the data may [initially] demonstrate success, it is typically short-lived, and cannot sustain in the long-term. Factors such as message fatigue, attrition and ‘flavor of the month’ syndrome erode the ecosystem, collapsing a seemingly thriving business in one colossal exodus.
This shift is inevitable, which is why a sustainable business model must be rooted in substantive relationships where offers/sales become a by-product of that interaction vs. a driver.
Remember that just because a group of people were open to ONE of your promotions ONE time does not mean that they will be open to the hundreds more that would need to ensue a 100+ times to keep an MLM profitable. And ultimately, the symptoms that spur MLM activity are usually the ones that eventually lead to its demise.
Really great comment Gennefer, and I think we are pretty much in agreement. I think the important thing is to put the power of promoting something in the hands of the blogger, online celebrity etc. I’ve been looking at smaller networks of jewelry sellers on Twitter with 4,000+ followers on twitter who send out 4 promotions a day and their networks are growing. Those are people running legitimate businesses, where twitter becomes their ad hoc CRM and support system. Some people want to sell their influence, but they want to do it on their terms for companies they care deeply about. Some people do want to be marketed to by the brand they care about, the Shaq brand knows this, as does the brittany brand. The genius of twitter is that it will support whatever network you choose to build, it just needs to start putting a value on that.
Excellent post Karl!
CHECK OUT MIKE DILLARD’S VIDEO!!
Just kidding
I’m not sure I get the connection between the experiment and analysis you conducted and the conclusion you drew from it (death of Twitter).
If Twitter manages to be the epicenter of these pockets of value, super influencers, smaller networks, no matter what we call them, they can build a revenue model in many different ways that would be tied to the increased value they generate for these smaller highly profitable networks.
We’re about to launch a Twitter feed in Traackr (yeah, it’s about time) that will feed our influencer scoring algorithm and we have conducted similar experiments to yours in the process to arrive at the conclusion that Twitter is creating tremendous value in niche communities, and could fairly easily find ways to extract a portion of it to support itself.
Glad to see SF is still treating you well!
Thanks Pierre, yes, twitter should be added to http://traackr.com right away. Anyway, my anger at MLM spammers probably drove me to write such a hyperbolic post, but the point is that MLM does have a business model and twitter doesn’t and if spam can create value then the spammers can overwhelm twitter, as if they didn’t have enough to worry about delivering Scoble’s tweets. Twitter is not cheap to run, so all those MLM spammers are eating up resources at twitter.
You may also like http://yonkly.com
it’s the first niche microblog that integrates with twitter.
If Twitter values the quality of its accounts, which it should if it wants to sell ads on them, why doesn’t it try to control the level of spam and bots that you describe? For example, if I use SEO in a Tweet, I immediately get several follows from accounts that follow thousands of people and are followed by almost nobody. This is clearly a spam account. Why doesn’t Twitter block them? Also Twitter could help people measure quality by displaying the follower and update counts in each follow message. This would let people see if they even wanted to follow back. The fact that they don’t do simple things like this shows that Twitter wants to keep the follow inflation going as a way of boosting their activity and “member” counts for a future acquisition valuation.
I have noticed this too Karl: The get-rich-quick-scheme crowd has found Twitter.
It’s a simple metric for them: You go on Twitter, get yourself a couple thousand followers by spamming, begging and retweeting.
Drive said followers to your “blog” which is really just a thinly-disguised e-commerce site for whatever you’re selling and… voila! – the money will come rolling in.
To Gennefer’s point though – if Twitter, which is still has primary value as an asynchronous IM-like device for most users, evolves into a sales-pitch a minute site… why would anyone want to be on there?
Karl, I’m not so sure that you were followed by the MLMers because of the gift certificate promotion. That may have been part of it, but I suspect it was simply a coincidence of timing. I’ve also been deluged with follows by MLM twitter accounts in the past 10 days and I’ve actually been rather quiet on my personal Twitter account as I have a dozen other Twitter accounts (for clients, communities, etc. – not spam!) to keep up. I just think the MLM crowd hit critical mass recently and have begun following everybody.
I don’t think spam will kill Twitter, but it will make it harder for the rest of us to use this incredibly powerful and flexible tool – personally or professionally. What would limit spammers is educating Twitter newbies about what to look for when you decide to follow people and encouraging people NOT to auto-follow. Obviously, if spammers acquire few followers, their efforts won’t be rewarded.
This may seem obvious to a lot of us, but I’m always surprised at how non-intuitive Twitter is for some folks and I often end up explaining a lot of this stuff to folks I recruit to Twitter.
As for Twitter monetization, I think your ideas are right on. As someone who spends at least two hours a day on Twitter, I can think of many more as well, but that would take up oodles of space to write about.
@CarriBugbee
This is precisely why I’ve opted out of the twitter = lots of followers game and actually block spam followers and I include that to mean anyone who couldn’t possibly be interested in what I have to say. Sure, they could still grab my RSS feed, but I don’t want them associated w/ my name. Lots of reciprocal follows also negates the usefulness of DMs.
If twitter is micro-blogging, why wouldn’t you eventually have the same review/contest/leave a comment/blog this phenomenon that you get with mommy blogs/craft blogs?
Remember that Twitter’s culture is still growing and each little sub-network of users is adapting it’s demands on, and use of Twitter as time goes by. I think MLM can find a niche of willing users, but at the same time they will polarise other sub-networks against them.
I’ve read of stores throwing special deals into their twitter-streams, but in a way that’s much less spam-like and still retains the ‘talking to a real person’ vibe – albeit a person that represents a company. That’s an advertising paradigm that stands to make much more headway I think, it’s closer to the culture of Twitter as a whole.
I don’t see that core conversation-oriented cultural style going away in a hurry, it’s demonstratably working for many people already and appealing to our natures as social humans.
From my personal perspective – if you want me to retweet an ad, you’d better pay me with the actual prize, not just a chance to win the prize. I’m lazy and greedy, and think there should be a direct cost to these spamming companies for every retweet, it’s the only way to keep a lid on the spam – barring a mass rejection by the community of course.
@cnawan I think MLM is a legitimate business model, my concern is that people are using fake twitter accounts to auto follow thousands of people and using spam to promote MLM.
Also, it’s worth noting that sending anything to the network of people following you is not spam, twitter is opt in and unfollow is 1 click away.
Excellent example. This is exactly what is wrong with the internet though. THis constant push to monetize it…to capitalize on what it can do not for the greater good but for the cheap bucks it brings. Its like someone saying bible paper makes good zig zags for joints…..just a complete disgrace it brings to the net. The internet is to exchange ideas…not profit from sleazy penis enlargement ads and ads for Kmart….just to stupid and without going into large strings of expletives…using twitter as a MLM tool makes me want to kick someones ass. Are you a democrat? I would say you are….lol
Karl, I’m afraid you’ve foretold the future. As a fairly casual user of Twitter (I use it more to follow favorite bands & interesting people) I am beginning to be overwhelmed by the number of “Adds” pouring into my inbox recently. All of them are for “internet marketing, MLM services” a quick ebay search turned up hundreds of auctions promising “Guaranteed 1000 Twitter Follows in 7 Days.”
Unless fast action is taken by Twitter (and I think your incremental charge idea is an excellent one) many users will just give up as Twitter looks more & more like MySpace.
I agree with Chris. It only takes a few to take a good concept make it useless for the many. Everyone needs to remember that all this hype about Twitter and Facebook has already been tried and proven. There is nothing new here. Does anyone remember MySpace? The same get rich concepts were being exploited there. So where are all the millionaires from using Myspace? Where is Myspace now? Where are all the users of Mypsace? What are they using now? Twitter… Twiiter Tip: Text “Stop” to 40404 to stop the Twitter messages!
Twiiter Tip: Text “Stop” to 40404 to stop the Twitter messages!