Who knew that Dell had 600,000 Twitter followers? In any event…the company has apparently tweeted its way to $3 million in sales over the past two years, including $1 million in the last 6 months.
That’s chicken feed for Dell, of course. It comes to about $2 of revenue per Twitter follower per year.
Hard to see Twitter getting rich off that. But it’s certainly a start.
Would Dell pay Twitter $1/year per follower? Possibly. If Twitter could throw in some analytical tools, it might be worth it. A direct pipeline to your customers and potential customers is always nice. So figure Dell soon hits 1 million followers, and figure the rest of the Fortune 500 follow suit. You could get to some nice revenue pretty quickly.
SAN FRANCISCO, Clare Baldwin (Reuters) – Social media company Twitter is struggling to craft a profitable business model, but the Web-based service has helped Dell Inc (DELL.O) chalk up millions of dollars in sales.
Dell said on Thursday it has raked in more than $3 million from Twitter followers who clicked through its posts to its Web sites to make purchases. The company, which has posted to Twitter about two years and tracks the sales with proprietary software, made more than $1 million in the past 6 months.
“We’re going to watch it over time to make sure it’s tracking at the right level,” said Lionel Menchaca, Dell’s chief blogger. “It is trending upward and that’s what we’re going to be looking at overall.”
Three million in sales over two years is a pittance for Dell, ranked by IDC as the world’s second-largest PC maker in the first quarter of 2009. Dell posted $12.3 billion of revenue in the first quarter of this year, alone.
But the PC maker has become one of the first public examples of how companies might profit from Twitter.
Twitter does not charge companies for such benefits, but does not rule out doing so in the future.
“For now, monetization of this type of activity remains unknown,” Twitter spokeswoman Jenna Sampson said in a statement. “However, as the network grows, the company will be committing more resources towards profitability.”
Gartner analyst Allen Weiner said such financial success could provide a model for Twitter, itself, to make money.
“Certainly one of the ways Twitter can begin to think of itself as a money-making operation is to facilitate a lot of these things, build it as part of the infrastructure. So if you’re a company, you can pay Twitter a certain amount of money and they can directly distribute coupons on your behalf, or clear transactions,” Weiner said.
Twitter is building add-on tools and services for businesses and professional users, co-founder Biz Stone told the Reuters Global Technology Summit last month.
Dell said it posts 6 to 10 times a week to its DellOutlet account, which is where the majority of Twitter-based sales have come from. Stephanie Nelson, who manages the account, said almost every post includes a coupon or a link to a sale, and about half of the posts are Twitter-exclusive deals.
The PC maker, which has about 600,000 followers, is one of the Top 100 most-followed accounts on Twitter, according to private trackers TwitterCounter and Twitterholic.
Whole Foods and JetBlue said they have not tried to monetise their Twitter presence. Woot.com and Zappos.com were not available for comment.
Twitter had approximately 17 million unique U.S.-based visitors in April, and about 24 million worldwide, according to Nielsen. Its number of users has grown by more than a thousand per cent over the last year.
Small companies are also finding financial success on Twitter. New Orleans-based Naked Pizza, which turns $1 million in sales annually, is “betting the farm” on its Twitter presence according to co-founder Jeff Leach.
The company, which created a Twitter presence about two and a half months ago and has about 4,300 followers, last week said nearly 69 per cent of sales generated during a one-day Twitter advertising blitz came from customers drawn in from the site.
Leach posts 1 to 15 times a day and said his company sees a sustained 20 per cent of sales dollars from its Twitter presence.
Leach recently put up a billboard advertising the company’s Twitter presence and is planning mailings bearing the company’s Twitter contact information instead of a phone number. (Reporting by Clare Baldwin in San Francisco; Editing Bernard Orr)