Are you, like many of us, addicted to Twitter? Well it could soon be having a very adverse effect on your bank balance. The social networking site has appointed its first Head of Commerce – former Ticketmaster CEO Nathan Hubbard. He will be in charge of developing a way in which people can buy things on Twitter itself, encouraging retailers to use ads to improve purchase conversions.
Hubbard, who will report to Head of Global Revenue Adam Bain, will be encouraging retailers to use Twitter to convert sales from tweets, and increasing user time on site as they won’t even have to leave Twitter to purchase items.
The move could make Twitter an awful lot of money as advertisers have already made up $582.8m in ad sales for the site this year, and the value of ads via “Sponsored Tweets” will rise and rise given the user option to buy “on-site”.
Also, Hubbard suggested that Twitter might take a percentage of transactions made on their site, so if “T-Commerce” is a huge success, a lot of money could be made.
But is this a good thing for the micro blogging site?
From a purely financial point of view, yes. But how will the users of the site who use it to engage, share and discover new content feel when the amount of ads rise and products are blatantly forced in front of them rather then cleverly disguised behind a smart and entertaining social media campaign?
Customer Relationship Management has always been the best form of use for social media rather than sales, so will this move get rid of creative advertising/social media campaigns by brands if they can make users buy their product instantly on Twitter?
There is also the risk for bogus companies to use the new functions as part of a scam – but hopefully Twitter will keep security tight and avoid these sort of problems.
eCommerce on social media hasn’t had a great history. Facebook tried and failed in 2011 with lots of companies like Gap and Gamestop shutting their online stores on the site down after just a few months when there was not much return on investment.
The stats don’t look too great either.
A study of 250 luxury brands showed that over the past four years, less than 0.25% of new customers have come through Facebook and less than 0.1% have come from Twitter. Compare that to 9.82% of customers coming from paid search and 6.84% coming from e-mail and you see that social media has never been a strong eCommerce platform.
That said, Twitter commerce may see a rise in purchases of the likes of concert tickets as users follow their favourite artists and bands, or impulse purchases of limited edition/discounted items etc, but as a general shopping destination, I can’t see how it will fit in with the way the site is used today.
But I would be very happy to be proved wrong! What do you think? Will “T-Commerce ” become a thing or another flash in the pain of social media commerce?