Twitter has been riding the crest of a wave for the best part of 2 years and the most interesting question on most people’s lips about twitter has been “what is it for?” and the second most interesting question is “what’s the business model?”

We at Aristos Social are very excited by Twitter as we believe it has huge potential to build communities around it, and as such, can help clients to generate some very interesting propositions.

Well, now we’ve had a sneak preview of the answer:

This apparently was a release that “slipped through the net” (thanks to ReadWriteWeb for publicising the page) and shouldn’t have been displayed, because it’s no longer up there as of now. However, it’s enough to make us all realise what they are going to do.

Business Model

Twitter has gone down the route of sponsoring/advertising on the front pages of the site, and this is to be expected, but has taken an inordinately long time to come together.

However, have they missed something here? They have an API and have built a very strong community around the product. This community has utilised the service through clients, much like email, and as such, has taken a lot of the traffic away from the site. It could be argued that without the clients, twitter would be nowhere as popular as it is today. Are they starting to advertise on the website where most people don’t use twitter?

How this can help organisations

Sponsorship and advertising will definitely produce a revenue stream, and it will generate some traffic.The difficulty will be in which adverts get placed on which profiles. This will require some interesting technology, as what do you display for? Do you display:

• according to the tweets a user is following
• according to the tweets a user is creating
• a mixture of the two
• trending topics on twitter at the moment
• randomly
• some other combination of the above

The most valuable opportunities are not in advertising, but in getting a community’s users to be advocates of an organisation/campaign/product. We wonder if the best solution is to generate a social advocacy campaign, which would partially remove the need for advertising anyway.  We’ve done that kind of thing before here, so we could do it again.

Interesting to watch Twitter’s Strategy

We’re going to be watching with interest as this unfolds. Twitter has some interesting challenges to face over the next few months as it tries to justify it’s valuations and will this year be the subject of a lot of interested parties wishing to buy the service.