THE BLOG
06/13/2010 05:12 am ET Updated Dec 06, 2017

Monetizing the Realtime Web: Lessons for Twitter

People love to interact in realtime. Last year saw the burst of Twitter into the mainstream and the phenomenal growth of Facebook. People love to interact in realtime, whether it is with each other or with content.

And now the world is watching as Twitter announces its version of how users will interact with ads in realtime.

Given that, we thought this would be a good time to share some of the insights we've learned and the challenges that we see us all facing as we tackle the problem of monetizing in a realtime web environment. (For specifics on our RiotWise product for monetizing the realtime web, click here.)

Some really good things we’ve learned:

  1. Users are open to ads as long as they’re relevant to their realtime experience.
  2. Advertisers really want to create ads that are relevant to the realtime experience.
  3. Realtime applications are starting to make serious money through advertising!

Some really hard challenges all of us face:

  1. Realtime targeting is complex
  2. Data is everything
  3. Advertisers need to be taught how to engage in a realtime experience.

OneRiot has been at it since October (beta launch in January), and in April we expect to exceed 1/2 billion ad impressions across our network of realtime apps.

Our impressions are in the stream (e.g. on Twitter apps like UberTwitter and social desktop apps like Digsby) and they are in search (e.g. on OneRiot.com). Recently we’ve started distributing them across the wider web through traditional ad units.

What we’ve discovered is that when the ad is relevant to a trending topic, relevant to what people are talking about on the realtime web, the click thru rate goes through the roof. In other words, if iPad is trending, and we promote the hottest accessories for the iPad, realtime web users love it. Even on mobile, the CTR goes from an industry average of 0.1-0.2% to over 1% and sometimes even higher. We’ve had CTRs as high as 8% when we really nail it.

Realtime targeting is complex

Every realtime ad engine is different, but the nature of the problem is the same. How do you adjust ads in realtime? People’s attention comes in bursts that you can seldom predict, and a hot topic will move millions of people around the web in minutes. How does an advertiser get in front of those people with an ad that resonates right now?

For ads in the stream, we do our realtime targeting in two steps. First we identify the trending topics for each application and audience. Not just “iPad”, but “iPad Sales Hit 300,000 on Day 1″ and “iPad Jailbroken.” This gives us anywhere from 2,000 to 3,000 trending topics per day. Users on UberTwitter tend to like certain categories of topics (defined by CTR) and users on Digsby like other categories. Our system uses CTR feedback to determine how to divvy up the topics by application and audience. This gets tuned and refined throughout the day, in realtime, to optimize CTR.

On the advertiser side we ingest content and products that our advertisers like to promote in realtime as they have it. For content, we take it in using our realtime indexing technology within seconds of it being published. E.g. Coca-Cola had a campaign that produced content around the NCAA tournament. We had their content in our index the minute it was published, and as it became relevant to trending topics we pushed it out to the appropriate applications (Digsby users absolutely love sports content). For products, we index all the top selling products on the web and surface them as they relate to trending topics (from iPad accessories to movie tickets to Clash of the Titans - bad movie, btw). All ads are created as the products and content become available and so they are always ready ahead of time to be matched to our trending topics.

This is especially important for search, where it is impractical for advertisers to create ads and buy keywords after a term has become hot. Not only is it a lot of work for the advertiser because terms are not predictable, but by the time the ad is created, users have already moved on to the next hot topic of the day. OneRiot advertisers don't buy keywords. That process would be too slow to monetize on the realtime web. They simply let us index their ads and we do all the realtime matching for them.

Using trending topics and pre-indexing of all ads, we're able to make sure our ads are relevant to the realtime web user. Even before we started optimizing, our network wide CTR was 4 to 5 times what our partners were seeing using traditional 'static' ads. Now that we have the data, we are starting to really optimize our ads in realtime.

Data is everything

Having the technology to optimize in realtime doesn't do much for you unless you have the data to crunch. And you need a lot of data. We're currently processing about 12 - 15 million impressions a day. Depending on the app we can start to make a real impact on click thru rates. For an app that has 100,000 impressions per day we can improve CTR by 20-30%. For an app with over 1,000,000 impressions/day we can often double the CTR.

That is huge for the application. Not only are you generating up to twice the revenue as before, but the user engagement doubles as well. No app developer wants ads in their product that hurts the user experience, and no user wants an app that has those ads (will the person who invented dating and mortgage ads please stand up?).

User engagement for ads is key for realtime apps because each one is still in the early days of competing for market share. Poor quality or irrelevant ads might generate some cash, but will send your users straight over to your competitor's product. Apps with ads that are 'realtime relevant' will generate revenue without getting in the way of the user experience.

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Advertisers need to be taught how to connect with users in realtime

Probably the most exciting thing about the realtime web is how fast advertisers are moving to connect with realtime web users. Social Media has become a core part of every advertiser's plan in 2010 and it is only getting better every day.

The challenge though is that advertisers need to learn the difference between connecting with users in realtime and their traditional channels. Coca-Cola might have a great campaign for promoting their brands on TV, but use that same campaign on the realtime web and it falls flat. But when Coca-Cola creates a campaign around the NCAA that is built on original content being published throughout the day by their fans, realtime web users love it. And that was only the first attempt. Crispin Porter Bogusky, Coca-Cola's ad agency and one of our early partners, will take the lessons from this campaign and make the next one even better.

As brands like Coca-Cola start to show success in the realtime web, other advertisers will follow. The result will be better ads for all of us. Ads that bring us closer to the brands we love because they're speaking in the language we love... Realtime.