Problem Statement
With the changing trends in the market in 2010 the need for making money was becoming eminent, and the owners of Twitter were in deep search for generating revenues. Twitter started as a free service, but it was high time that the social network had started generating revenues. The leaders were concerned about the revenues and were in search of a competitive business model in order to resolve this concern. A solution was there for the trio that will enable the site to generate revenue in order to stay in the market and stay competitive. The solution was to pursue data mining of the customers, but it also raised concerns about the leakage of privacy of the customers.
Recommendations
There are two recommendations that can generate revenue for twitter and will also cater the issues Twitter is facing. The first recommendation is to collaborate with research firms and sell the information of users and help them gain some productive results from the information provided. Users' concerns over the privacy issue can also be tackled by gaining their trust and permission before sharing their information and convincing the users by highlighting the positive side of the step. This will help to gain a positive image for twitter and will help in creating a positive brand name and will also provide a source of generating revenue. The second recommendation is to make room for sponsored tweets and using these sponsored tweets to collect a good sum of money, adding another source of revenue. Sponsored tweets are more related to advertising that is the major source of revenue for companies like Google. Advertisements are the most effective medium of generating revenue for social web sites.
Rationale
The rationale portion will provide the detailed description of the alternatives available for twitter in order to generate revenue and to keep the information of the users secure.
Alternative 1: Sponsored Tweets
Sponsored tweets, is the first alternative for the company to adapt in order to tackle the issue of generating revenues. The website is offering sponsored tweets, but the intensity is very low and is not generating effective results. The site can offer sponsored tweets more often or in regular intervals at the top of every page to grab the attention of the customers. Moreover, the industry is at the stage of early maturity, but twitter is still growing. Although not much competition is there for Twitter and only Facebook is considered as a prime competitor. The site can use the sponsored tweets as the source of advertisements, providing sponsors a new source and medium of advertising their brands.
The user base is increasing, and companies are highly favored and utilizing this option. Currently, the company should not focus on generating user base, but ways of generating revenues and advertising is considered as a major source of revenue for social networking sites. This method is highly optimized by Facebook and google as well and is serving them best. Although Twitter is not as diversified as Facebook, but can use the method of advertisement through sponsored tweets and generate revenues for further growth.
Alternative 2: Sell the User information to Research Companies
Selling information after gaining permission from users to research companies will give a very authentic and sustainable source of generating revenue for the company. Research companies need data, but collecting data is a very challenging task. Therefore, they will appreciate this step and will be ready to buy data hand to hand. Secondly, the research conducted will be a positive cause and will provide twitter a reason to convince users to get permission for sharing information. Although users will show resistance, but this has eventually created a positive image for the site as a user-friendly and supporting a positive cause. On the other hand, the site can also convince others by offering them different incentives through lucky draws. Selling information is a unique method of generating information and with the user base with millions of users, the revenues are expected to generate huge profits......................
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It was in early 2010, and the trio Twitter, founder Twitter, faced with a change of the market situation and the pressure to make money. Twitter was a free service that works without a viable business plan in 2006. In early 2010, Twitter still do not earn enough money and time Twitter showed a real return on investment. The trio was to decide on a business model that was competitive. There was a data mining project that would bring all the tools you need Twitter, to stay in business, profit and compete with others. However, the founders were concerned that this project can be seen to invade the privacy of users, even for a company that was founded on the exchange of information in public. "Hide
by Deborah Compeau, Nicole RD Haggerty, Shady Fraiha Source: Richard Ivey School of Business Foundation 17 pages. Publication date: April 15, 2011. Prod. #: W11037-PDF-ENG
