The Future of Twitter: Social CRM

Twitter has multiple business models to choose from
I get asked over and over: “How do you think Twitter will monetize? What’s their business model?” While it’s clear they’re already experimenting with ‘house’ ads, ads that promote features of their service, I’m not sure that’s going to be the right direction for them. We already know that click through rates on social networks are low, why? because people are there to communicate with each other –not search for information like Google or on a media site. It’s possible they could turn on ads in the search tool, as people are seeking information. Yet all of these tactics have been done on other social sites, I think that Twitter has a unique opportunity to tap into the lucrative CRM space.

Manually tracking a large brand within Twitter isn’t scalable
It’s important to first realize that managing a large brand on Twitter isn’t scalable, with hundreds –maybe thousands of tweets about a marketplace a day, individuals will have a very difficult time managing, Brian Solis has some relevant stats on growth. The next challenge? determining who these people are, and if they are a potential customer is important, who are these people, are they important, where do they live? Lastly, responding in near real time is going to be key –as some users may ask their peers for product recommendations during point of sale, right in the store.

Twitter has two of the three key features of a CRM system
First, let’s break down why Twitter is going to be a Social CRM, let’s start by analyzing what entails Customer Relationship Management:

1) Customers: Yes, they got that. More than that, they have prospects, which to some marketers is far more valuable. As prospects start to talk about products, they’re indicating engagement, and could be further down the buying process. Both are valuable, however the challenge is mapping which Twitter ID is which customer –many don’t use their real names.

2) Relationships: Got that too. Now I realize that the intended definitions of CRM meant the relationships between customers and employees of a brand, but now you can see how people in Twitter are connecting to each other, and those that follow a brand, their indicating affinity towards them. The interesting thing is they don’t just offer affinity towards your brand, but also competitors, which helps in segmenting your market, and can help with poaching.

3) Management: Here lies the opportunity Twitter has no management tools to support this, as a result, their data is being whisked away in the API and being aggregated by two types of companies. The first company? Traditional CRM companies are importing the data into their own systems, in fact we know bits and pieces of this are happening for Facebook. Secondly, brand monitoring companies like Radian6, are importing twitter data into their listening platforms, and then offering simple workflow and task management.

CRM Incumbents Moving In
Today, SalesForce announces it’s integration with Twitter, or at least, their aggregation of their data in what’s called the ‘Twitter Firehose’ in order to suck in the discussions and allow it to be managed within the SalesForce system. As a result, brands will start to monitor –then manage– the discussions that happen online. I was briefed by Clara Shih (related book), the creator of FaceForce (now called Faceconnector) (Facebook + SalesForce integration) last week, and while I think they’ve taken one step forward –there’s more to be done in confirming IDs, influence, and intent to buy. Update: Here’s the Service Cloud site, which emphasizes customer service and support.

Twitter’s Opportunity –should they decide to take it
Although they have not directly said it, I think Twitter can go further than this, they could be their own CRM system, by perhaps offering their own analytics system to brands, that will help them to track and manage the conversations within the 140 sphere. This has tremendous opportunities for Twitter should they create their own brand management system that they can resell to the world’s companies to monitor, alert, track, prioritize, triage, assign, followup, and report on the interactions with brands. The myriad of authority based tools will need to be incorporated, as some users have a larger network and are therefore more influential than others. On the other hand, they just might leave the firehose open for the incumbent CRM companies to take advantage of –and miss this opportunity, hell, Scoble is already expecting brands to contact him when he has a major life event. Either way, with a recent funding amount of $35mm, they’ve enough run rate to first manage growth, then prepare for monetization.

There are a few layers when it comes to how Social CRM can evolve, I’ll save that for a future post. On a related note, this is one of the key findings from our many interviews for the upcoming report: The Future of the Social Web.

154 Replies to “The Future of Twitter: Social CRM”

  1. If I was running Twitter, this is what I’d do:

    Forget about Focus on the API, open it as wide as possible, provide better support, listen to app developers, make it fast, responsive, give them access to more data, more functions. Design the API to give startups confidence they have a future working with Twitter, confidence they won’t sell to a crap company like Yahoo, and a chance to get a running start before asking for money, throttling, etc. Ne clear about your intention to monetize the API. Now you have hundreds of startups doing all the work for you, advertising, providing content, apps, etc. Charge for access to the API, advance the infrastructure, build relationships w/ your app developers. The startups will use the Twitter API network because it’s the biggest network, and they will stick with you for the same reason nobody wants to leave Adwords/Adsense.

  2. Jon, that’s not how they think at Facebook. Facebook is a big walled garden of walled gardens. You can’t link in. You can’t link out. The whole thing is locked up like Fort Knox. It’s a totally different animal. Facebook is about privacy. Twitter is about sharing, news, open communication.

  3. Pretty sure I wrote an article for Mashable two months ago called ‘What is Twitter’s vision?’ where I basically say (predict?) the same thing – a great biz model for Twitter is analytics. Someone’s going to do it – may as well be them.

  4. with so many intelligent people throwing ideas at twitter, i don’t understand what’s taking them so long. this is crowd sourcing at its best and they seem to be missing the boat. this idea is smart, and there are others as well. just pick one and go with it.

  5. This is a very interesting approach on how to move with Twitter. Definitely I believe that they have reached a point in which they need to make a decision (capitalize on it or sell it!) on how to really get the best out of it.

    Something that has really caught my attention recently is the large amount of API that are growing and providing content or stats about the usage of

    Definitely being a “proprietary CRM” is a great option specially if they can truly exploit it. Bottom line, I believe, they will go in this direction and try to monetize it with large brands that can get more insights from people based on the segmentation that they can come up with.

  6. Jeremiah, This is definitely the direction I see Twitter heading. One thing I’m wondering: if awareness grows of the analytics function, will that stifle open conversation? Or maybe it will be like people who forget after awhile that they are on camera, or being recorded…

  7. David

    I recently met with CoTweet, and Radian 6, and Scout Labs. They all have CRM like features that are overlaying on top of Twitter data. There’s some other CRM systems that are starting to do this too, so it’s certainly a trend.

    My whole point is that Twitter (and to Dennis’s point any conversation hub) should think about creating their own management toolset.

  8. Hmm .. I wonder if Twitter are paralysed trying to decide which is the best route for them.

    On one hand, there’s provision of service described above, an area where they would have to start competiting with other services that are using their API.

    On the other hand, their core competancy is providing a scalable many-to-many communication networks with an open API that other service providers can leverage.

    The question is, which of those should they be focusing on? My gut feel is that the ecosystem they have built around their API is what’s driving the value of their network, so they should be working with development teams to improve, streamline and eventually charge for their network; rather than trying to get into a new space which is already being encroached by other parties.

    Will be fun to watch though.

  9. Very interesting. I also think twitter’s best approach might be to build their own CRM system. In fact, I wouldn’t be surprised to learn they’re already working on it.
    In the meantime, the upcoming version of twitscoop will take a step in this direction to some extent…

  10. It’s the perennial horizonal vs vertical strategy discussion I guess. Social CRM may be a great idea, but I somehow don’t see Twitter locking themselves into a relatively small segment when their platform can be used for so much more.

  11. @scobleizer may want to have adverts pumped at him in response to his life events. What people want from their life events changes… Personally, one of the reasons I won’t go to Chrome as a browser is it lets too many Facebook ads in… AdBlock Plus and Greasemonkey scripts improve Facebook significantly.

  12. While bolting “social” onto “CRM” is an interesting development, I don’t beleive it will work. CRM systems are antithetical to social ones (rigid, comprehensive, hierarchical, etc.)

    What’s required to capitalize on social media in customer service, marketing, product management and business strategy applications is something new. I call it Social Relationship Management

  13. When you write “their” you sometimes mean “they’re.”

    “Their” is a possessive, indicating ownership – “their API” means “the API belonging to them.” It’s clear that you know this, as you use their correctly many times in the article.

    “They’re” is a contraction of “they are.”

    So “…their already experimenting with ‘house’ ads…” should be “…they’re already experimenting with ‘house’ ads…”

    I wouldn’t have mentioned this, except that you made the same mistake twice in this article.

  14. I don’t think that they will ever be able to monetize it. Instead,

    Twitter should focus on the apps and user profiles, maybe build out sites for users to store media, blogs and content. They could also work on pulling all the other networks into theirs to make one centralized locale.

    People like customizing and branding. They should capitalize on that.

  15. I love the simplicity of Twitter, but think there are so many areas for growth – CRM is most definetly one of those areas – and additional features that could be added to make the users experience more beneficial.

    This is especially true in when it comes to businesses using Twitter. With more analytics tools and more sophisticated search tools, Twitter could evolve into the MOST useful/powerful social media tool for businesses (i.e. metrics, engagement, CRM)

    It seems as though all of the apps Twitter is associated with are provided by outside programers … Why do you think that is? Why doesn’t Twitter take a more hands-on approach?

  16. Great post.

    Why is twitter keeping their monetization strategy a secret? Do they really not have one? Seems inconceivable. Don’t buy the argument that they can’t. The move by Salesforce is very sharp. Social media monitoring is the next step for them as many hav previously noted. Branching out into marketing automation is an enormous growth opportunity for Salesforce. They do risk getting bloaty though.

  17. Twitter is going to be huge. CRM, social network or whatever, this compagny is a real winner. Nothing will stop it now. And this is good. I like it.

  18. Excellent post & opportunity! However, IMO, I don’t think CRM is the direction for twitter. I agree with some others like @owen, @Ferodynamics & one of your replies. Twitter should build on its core competencies: viral reach, content & APIs. Competing with third-parties would just be anti-social 🙂

  19. I have been waiting for these types of Twitter inclusions in major brand management software. I think apps like @cotweet or software from hubspot or radian 6 are more likely to form the complete Twitter CRM package far more quickly than Twitter itself will. @Cotweet already has the followup assignments perfected pretty well and a nice collection of strong brands testing their service as their main Twitter client. I think this is an important aspect of the future or Twitter for any brand. Taming the information and forming it into actionable items is key.

  20. Twitter may have many business models to choose from, but they seem to have problems scaling. And some of their policies aren’t conducive to encouraging users to grow their use. Many of us have suggested a Pro account where we would pay to have restrictions lifted.

    In terms of analytics & CRM, Techrigy SM2 also gathers all of the information generated on Twitter. We offer full historical back to Oct 2007. And the conversations & retweets can easily be sorted & analyzed in many ways.

    Community Strategist, Techrigy

  21. One thing that is very worrisome is that twitter users never need to go to the twitter site after signing up! At one point they will have to start charging these 3rd party apps to use the API. I feel that once the users are asked to pay for a service, they will abandon it pretty quickly. The price they pay is using the system, and they allow us to use the system by totally bypassing their interface. Big mistake.

  22. sCRM is social community relationship management. That is much different than legacy CRM. sCRM is about building long term social community relationships with consumers through and across social services. sCRM is much broader than a single social service. Social services come and go.

    So why would a brand bet on any single consumer social platform for sCRM when they know 2 years from now the entire landscape with be different and they may have to start all over again?

    Long term sCRM requires a platform that has a Brand’s long term interest at heart. This requires cross-platform management and social service “Switzerland.” That is not Twitter or Facebook.

    If you are interested in this point-of-view check us out at SocialEyes.

  23. I am new to Twitter and the internet so kindly pardon my generics in this discussion thread. Today Twitter initiated the Follow Me on Twitter message:

    Just added myself to the twitter directory under: #socialmedia #celebrity #music

    Where you get directed to selecting 3 categories such as those and the point being that the more logical selections will be where the most followers are at in the 100’s of thousands. You receive an automatic insert into the public_timeline.

    This may be the first in “branding” that I see?

  24. Great job stirring up this conversation, Jeremiah.

    I do believe you are pointing out an exciting opportunity for Twitter. I have to wonder, however, if it is “the strategy” for Twitter, versus “a strategy” that is part of a larger mix.

    Now that Twitter has significant investments from Spark Capital, Benchmark and IVP, I suspect the drive will be there to capture the absolute biggest market possible and for many VCs the holy grail is search (aka Google).

    These guys will readily trade off risk for reward if they believe they stand a chance at disrupting this huge market. While CRM is lucrative with (for example) reaching an impressive $1B in revenues, Google has monetized search into an opportunity that is 20-25X larger in both revenue and market cap ($4.4B versus $107B).

    You make an excellent point, however, on the click-through rates for social networks and also the reason why people are there (to communicate vs search). And while it is unclear if Twitter’s “real-time search” has the makings of THE disruptor of the search market, I wonder if this is the space the VCs will be pushing Twitter to go after in the long run?

  25. Hi Jeremiah,
    Thanks for the thought-provoking post, though I have to say that I would disagree. Twitter is NOT going to be Social CRM without an overhaul that would make it unrecognizable. I’ll be posting an entry on this in my ZDNET blog over the next day or so. Suffice to say Twitter is a channel for locating and engaging customers. SOCIAL CRM strategies will have to account for it. Social CRM applications will have to incorporate it as a channel. Marketing, customer service and to a lesser extent, sales, can find value in using Twitter as one of its channels. But only as a channel in a customer engagement strategy. Just one of them.

  26. “who are these people, are they important, where do they live”. I also think here lies the key. As Twitter will go mainstream, we will see more and more people from more and more places coming in, and this will represent a cultural challenge for large brands.

    But in the CRM field, there are excellent third-party companies able to deal with the data they get (provided Twitter still gives the data through their API). For me, Twitter’s future lies IN the data, not AROUND it. Despite the fact that you can write what you want in the “location” field in your account, a growing number of people is accessing Twitter from a mobile phone or a location-aware device. Such a geographic (and semantic) data would be invaluable for marketers.

  27. Clearly you’ve identified one critical means by which to leverage data. In the end the same problem that businesses are ignoring today, will still face them, how to interpret AND interpolate the data — then how to decide what relevant action should be taken. It’s in the latter that FAILS occur.

    Where Twitter helps most is in Emergency Triage. That’s not the same as ‘fixing’ the problem for the long term.

  28. Pingback: Twitter CRM? Nah!
  29. Yes, great post and very interesting.

    Savvy businesses are already using twitter for buzz tracking and can learn a lot just from twitter search and subscribing to a relevant keyword or two via rss. As you say, though, with growth (or if a big business) scalability will be tough with just twitter search.

    However, wouldn’t an ideal robust social crm/analytics outfit incorporate other channels besides twitter? Twitter has a lot to offer in terms of crm, but so does a whole slew of other social media venues. I think some kind of partnership with such an outfit could be lucrative for them and more valuable to the end user.

  30. I don’t see CRM. Twitter is just a pipe. They have no customers, no relationships, no management. Who is Twitter? A friendly pipe.

    Much of what is in the Twitter Pipe seems to be noise, not signal, and there is a lot of pollution in there as well. Business wise, Twitter is Amway gone Internet scale at is best, except it is someone else selling through Twitter, there is no Twitter product.

    Twitter is a communications service provider, and historically such companies need to exert control over their users to generate $. Case in point, SMS the root of the 140 character limit. SMS messages generally have no marginal cost to carriers, yet consumers are charged for such text messages as if every 140 characters were a slice of gold.

    There is money in communications, but not by being the nice guy.

    Twitter is awesome, the Twitter people are cool. I love Twitter! However the adoption it has achieved by being so open undermines its commercial leverage; the delightful free form of its lack of structure undermines its ability to provide value. And it is a service fairly easily duplicated.

    I expect Twitter is more a verb than a commercial company in the future, bless the fine folks who created it. Not seeing any CRM here.

  31. Fascinating post and great analysis – but I’m not sure if “CRM” captures the scale of the opportunity.

    Based on their brand and momentum, I think Twitter stands a fair chance of capturing one of three valuable social places on the web – the public commons – and selling access for market analytics, ads, and sophisticated forms of offers and engagement with consumers (if it can be done without alienating the Twitter base).

    I believe the other “places” that where people socialize every day are: my neighborhood (Facebook) and my workplace (currently in play as “Enterprise 2.0”) with a lot of interesting interplay of relationships.

    To me these three places are the core domains of social software.

  32. Twitter as one big commercial billboard? I’m already thinking of quitting Twitter by going cold twerky. Manipulating me via CRM will push me over the twedge.

  33. Was just able to read all the comments and all the associated links. I really appreciate the dialog, including those that think it’s a not the direction that Twitter should –or will head.

  34. Interesting post. You mentioned in the beginning, that people are on social networks rather to communicate, not to search information. This may indeed be one reason for the problems io social networks and marketing. But, is there any research/scientific reference yet, which supports this statement?

  35. Christian

    Yes, we’ve done research at Forrester to find out how youth use data. I’ve a slide, but I can’t share it in public as it’s for clients. Summary: people use social networks to be ‘social’. (talking to each other, checking each other out, self-expressing) more than the activities of searching for products and brands.

  36. I don’t know anyone who twitters, is this just for 13 year olds with mobile bills they don’t have to pay?

    Where is the sense in this ??

    is it because i am 72 yrs old?

  37. I’ve got twitter in my pants, and by that I mean it’s time to generate meaningless data with richer content than just “I™m eating eggplant and touching my left nipple” Twitter needs to strap a photograph/gps location/smell/ for the last 24 hours of someones life into an interactive map like google earth. Then finally the people of earth can stop functioning like normal humans and indulge in non stop narcissism.

  38. 1. The other reason, IMHO, that large, ‘social’ sites do crap advertising is there’s very little context and relevance. It becomes spray and pray. Great strategy, right?

    2. Re: Twitter being a CRM, I agree. I’d argue that this applies to other ‘social’ websites or social experiences integrated on any website. At the end of the day, you drive engagement to get 1) data and 2) actions that can be informed by that data (programming, marketing, promotions, etc.).

    Does Twitter do this or does it get bought by someone to become more of a CRM? Personally, I think the latter of the two is more likely if they can find a suitor that gets the value and doesn’t mess with the ‘front end’ but has the expertise and experience to maximize the potential of the back end–not to mention a large client base that would LOVE it and pay for it.

  39. It seams like there is still a lot of work to be done to make social networks increase productivity through a CRM. Especially with new advertising models being tested.

  40. Twitter will have to be careful to avoid the Facebook drama route if it does opt for CRM and ensure all users who prefer to keep their tweets either private, or off the corporate radar, can do so easily.

  41. I’d say that Twitter knows exactly what it’s doing.

    There obviously is some major bucks in the background making it work and they, more than anyone, probably understand the real growth and potential.

    I’d say they are biding their time and are not revealing anything until they are in the best possible position.

    We involved/playing the Twitter-sphere may feel that it’s mainstream but it’s still an unknown wonder for many.

    I’d say they have a plan and a very good one. I’ll be supportive and excited to see it roll out.

    Craig Moore

  42. Great post. My personal opinion is that while Twitter should absolutely take advantage of its new position as a leader in the social media space, they shouldn’t get too bogged down with bells and whistles. Metrics can be gathered and available, but shouldn’t overwhelm. Otherwise, you risk alienating the small business owner that wants to participate in a system like Twitter because it’s so simple, but doesn’t because there is too much for them to learn.

    In my experience, there are still a lot of people out there who aren’t comfortable with technology, let alone social media, and this is the chance to bring them into the fold without burdening them with what a full CRM can do.

  43. Nice blog and good information. There was something released that Twitter’s first major move is to charge a fee for special ‘business’ accounts. I am thinking this accounts will be official and have something to indicate they are who they say they are. They need to move on this to high profile celebrities.

    Honestly, they need to focus on their search engine potential. Looks like already beat them to it!

    – James
    #1 Site for FREE Twitter Background and Backgrounds

  44. Twitter won’t follow Friendster and Myspace ever. Because there more like a “real time” Google SE then anything. If I want to find say 100 different seo consultants worldwide, I don’t go to Google anymore. I go to and put in “seo consultants” I get dozens to hundreds of listings. Best part NO spam, adsense, link farm, articles, press releases, blogs or affilaite sites that own Google.

    Just the one thing I want, actual PEOPLE to contact.

  45. Interesting post…I am not sure it is even worth classifying it as traditional CRM especially for Enterprises.
    In the fear of stating the obvious…Social Media behaves more like Feedback System and gives us real time insight into what Customer is Experiencing or feeling in their own words. It is better than running analytics on historical Customer data and understanding Lifetime value scores for Real time decisiong…it also works better than the old school form of sending out surveys or questionnaires to understand how the Customer feels…This is because just by reading the tweets you exactly know what a Customer’s state of mind is like.

    If they get it right…one interesting business model is Twitter could be the required cheapest CRM for the Longtail SMBs…and give the SaaS vendors a run for their money.

  46. One thing that bugs me about social media is all the advertisements you have to see every step of the way. if it were just a couple, it wouldnt be so bad I might even click on a few. Its when they overwhelm you with ads so much its distracting to why your there in the first place that makes it so annoying.
    The neat thing with twitter is that its ad free for most part. Unlike myspace and facebook. More junk cluttering up the screen than actual content.

  47. It would be very interesting to see if the Twitters of the world can work with all their consumer behavior data in a way that is valuable to the large brands. At this time it is similar to back in the 80s when we knew there was gold in purchase behavior data but couldn’t get to it. In this case it is not purchase data but brand awareness and perhaps like/dislike/have bought information.

    We’ll see if this area starts to be one of fertile data for brands.

  48. Still requires sales process strategy/management- “How to turn your sales team into Trust Agents” – just happen to be developing this model now- will be interested in feedback late Sept. for those interested.

  49. with so many intelligent people throwing ideas at twitter, i don't understand what's taking them so long. this is crowd sourcing at its best and they seem to be missing the boat. this idea is smart, and there are others as well. just pick one and go with it.

  50. I'd like to add into the mix. We haven't gone down the path of having it monitor discussions on Twitter, but instead its meant as the part of a CRM that helps you takes notes on clients and also tag them. You can then search your Twitter user's bios and the notes, and filter on tags. We are currently working and close to finishing the features of adding in emails, social urls, birthday, addresses, etc…a full Contact Management piece, including exporting to vcard. This will help you take those you meet on Twitter and get them into any other system too, along with all the tags you use on them and all the notes you take on them.

    Additionally, you can pause someone you are following, and even add Twitter users to your account that you aren't following and take notes on them. Feedback is always welcome.

  51. Very interesting post, but i just think that it's important to consider the propensity of social networks to inglobe and offer to their users the search functionalities in order to keep them inside the network as much as they can. So the ppc ads approach can be re-used also in SN integrated with the friend/follower/connection recommendations.

  52. Twitter is part of a broader category of social marketing. A major trend that is very evident and will continue to increase is the use of social media to attract leads and potential customers. Tools such as Customer Relationship Management (CRM) put the customer in the center of daily operations and allow for a 360 degree view of the client. SocialCRM is a way to combine traditional front office processes (such as email marketing, lead qualification, forecasting, opportunity management, etc.) with social marketing avenues like Twitter, Facebook, and LinkedIn.

  53. The benefit of social media is undisputable in regard to the dialog between customers and companies. Particularly, the dialog within 140 characters stood out the most in the core of public discussion concerning the usage of collaborative media in business area. Yet, the Customer Relation Management proves to be the perfect environment for Twitter&Co.

  54. The benefit of social media is undisputable in regard to the dialog between customers and companies. Particularly, the dialog within 140 characters stood out the most in the core of public discussion concerning the usage of collaborative media in business area. Yet, the Customer Relation Management proves to be the perfect environment for Twitter&Co.

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