Microblogging site Twitter is expected to earn worldwide advertising revenues of $400m by 2013, according to a new forecast from market research firm eMarketer.
The company estimates Twitter to earn $139.5m in global ad revenues this year, up 210% from $45m in 2010.
"Since their debut in April 2010, Twitter’s Promoted Products have proven successful in the US," said eMarketer principal analyst Debra Aho Williamson.
"Marketers have shown solid engagement rates with Twitter advertising — in some cases better than those on Facebook — despite Twitter’s relatively smaller audience," Williamson added.
Of the ad revenues, 96% will come from the US this year, eMarketer predicts, falling to 88% by 2013. Twitter’s US ad revenues will still more than double during that time period, rising from $133.9m this year to $351.6m in 2013, said eMarketer.
This forecast features a slightly lower 2011 ad revenue estimate than eMarketer’s previous estimate from January 2011 — a result of Twitter’s slower-than-expected rollout of several advertising initiatives.
"Twitter took several months longer than expected to start selling advertising in the UK, but more international offices are coming soon," Williamson said. "In addition, the self-serve platform has been in development for some time. When it launches, it will open up Twitter to more small and midsize advertisers."
"Twitter is looking to compete for the same advertisers that made Google and Facebook’s self-serve advertising platforms smash hits," Williamson added. "Self-serve advertising accounts for about 60% of Facebook’s ad revenue — that’s a pinnacle Twitter will hope to reach as well."
Earlier this month, Twitter said that it now has 100 million active users and that the popularity of the microblogging site on mobile phones is surging.
Twitter chief executive Dick Costolo said that the company is now planning to expand its advertising space, and that it is in no hurry to undertake an initial public offering.
"We want to be able to remain independent, grow the business the way we want to, and not be beholden to public markets until we feel like we want to be," Costolo said.
Costolo also revealed that Twitter is "seeing tremendous growth on mobile."
He said that the number of users who log in at least once a month on the site, also known as ‘global active users’, has grown 82% from the start of the year, while usage on mobile devices grew 40% each quarter for the past year.
Costolo also announced that Twitter will allow adveritisements on ‘promoted tweets’ and that users will see those from companies that they do not follow.
"We now feel that based on the engagement rates we’re seeing … that we’re ready to expand this further," Costolo said.
He added, "It’s our firm belief that our advertising platform is the only revenue component that we need to have in the market in order to be a huge independent business."
