Why Twitter's 'Suggested Users' is the Next Superbowl Ad (or "Calacanis offers $500k for three years")

Title: Why Twitter’s ‘Suggested Users’ is the Next Superbowl Ad (or
“Calacanis offers $500k for three years”)
Location: Mahalo HQ, Santa Monica
Date/Time: March, 19th 2009 2:14pm
Subscribers: Does it really matter? It’s just a number (13,159)
How to sign up for Jason’s List: http://www.tinyurl.com/jasonslist
How to follow jason on Twitter: http://www.twitter.com/jasoncalacanis
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Last week, some of you may have read a headline that said I offered
Twitter $250,000 to make me one of the default users in their system.
The headline is almost accurate. I did offer them $250,000, but it was
for two years as a *suggested* user, not a default user. There are no
“default” users on Twitter. There is simply a suggested users page
when you sign up. Being on this page results in 5-10k people following
you per day.

Also, I wasn’t thinking of using the suggested user slot for
http://www.twitter.com/jasoncalacanis, but rather
http://www.twitter.com/questions. There is a big difference: one is my
personal account and the other one is for Mahalo’s Answers product,
which is booming. (40-60k folks are using it daily after 90 days in
the market). With over 60,000 followers, my personal account is,
frankly, probably bigger than it should be. 🙂

Splashing the Pot
A quarter of a million dollars is attention-grabbing and that’s
exactly why I offered it: I wanted to splash the pot. I wanted to get
the attention of Twitter CEO Evan Williams, founder Jack Dorsey and
most of all investors Fred Wilson and Bijan Sabet. It worked well, and
I’ve been in brief, but not substantive, discussions with each of them
about marketing the Mahalo Answers product on Twitter.

In the process of making this offer, we received a ton of press and
started a massive discussion about the monetization of Twitter. I’ve
been told that, at conferences all over the place, people have been
discussing “Calacanis of Mahalo’s proposal to buy Twitter users.”

Excellent. Two of the three nouns in that sentence belong to me. 🙂

Of course, I was only half-bluffing with this move. I was 90% sure
Twitter wouldn’t take the money and I wouldn’t have to pony up a
$250,000 check. However, if they did call my bluff and cashed in the
$250k, I actually would have gotten what I wanted: two to ten million
Twitter followers and the ability to drive one to two million visits
to Mahalo a month from Twitter.

My plan was to post the Top Five most absolutely fascinating questions
from Mahalo Answers to our @questions account every day.

Everyone loves a timely or fascinating question and, in my estimation,
I would get a one percent clickthrough rate on each question. If I was
able to reach three million followers, and kept half of them (1.5m),
that means every tweet would get 15,000 visits. Five a day means
75,000 daily visits, and over two million visits a month–or close to
50m visits of two or three years. Some percentage of those two million
would participate in Mahalo by asking or answering questions, and if
that number is also .5 to 1%, that means I would get about 250,000 new
members for my service.

Each of those 250,000 new members would cost me one dollar, and I’m
certain over their lives we would monetize them for much more than

In other words, I was absolutely certain that the $250,000 bet would
pay off. Either I would just get the press for making it or I would
get the press for making it AND get the deal of a lifetime.

What’s a top slot actually worth?
The top 20 slots on Twitter are actually worth–to some people–2-10x
what I offered. If Southwest, Amazon, eBay or Zappos were to get their
hands on one of these accounts, they could easily make one
uber-compelling tweet a week. 50 tweets from Amazon with things like
“Top 100 Science Fiction Movies of All Time–as rated by George Lucas”
would garner a two to 10% CTR. A Zappos tweet with “Back to school:
Buy two pairs of shoes get one free” would get a huge response on
August 20th.

A JetBlue daily notice saying “The first 1,000 folks to respond to
this alert get $25 off their next flight” would mean never having
another empty seat.

The point is that Twitter has the ability to unleash a direct
marketing business the likes of which the world has NEVER seen. I
predict they will, and when they do, they will make the Twitter
nay-sayers look like the donkeys they really are. (Note: you ever
notice the folks who have the most to say about making money are the
ones who’ve never made any? Exactly.)

Direct marketing by mail changed retail forever, as did the Web and email.

Twitter will take that to an entirely new level. Why? Because people
*live* inside of Twitter like they have never lived inside of a
product before. We have NBA stars twittering about their performance
at half-time and a president who leveraged the service to get elected.
It doesn’t take a genius to understand that there is something
disruptive going on here.

Compared to the Superbowl
A Superbowl commercial costs $2.5-$3m for 30 seconds and is viewed by
some percentage of the 100m folks who tune in (i.e. those that aren’t
drunk and/or making out in a bedroom somewhere). Let’s say all 100m
see your message, with the ones who didn’t see it being made up for by
the couple million who see it later online or on the news.

If you paid three million, that would cost you about three cents a
person.  If you paid Twitter $250k and got five million followers, it
costs you five cents a person.

The Superbowl folks you market to once and it’s over. More than 50% of
the Twitter users will follow you on an ongoing basis if you post
creative, fun and helpful tweets.

Bottom line: Superbowl commercials are for one drunken Sunday, but
Twitter relationships can be for life.

What is so disruptive about Twitter
From my perspective, the most disruptive thing about Twitter is its
presence. It’s everywhere at all times in a way that only an AT&T “You
Will”-style commercial could have predicted in 1995 (or could explain
in 2009–funny how that goes huh?). People get and give Tweets from
the time they wake up until they fall asleep.

Twitter is a giant, open email box that we all hang out in every day.

The power of Twitter is yet to be fully understood, in the same way
email and the Web weren’t fully understood… except by the people who
made the AT&T “You Will” commercial. (Who the frack were those
geniuses anyway!??! If someone can tell me who did those commercials,
I’d like to take them to lunch!).

Oh yeah, I think I re-raise
Quick message to Twitter and their investors: I re-raise.

My new offer to Twitter: $500,000 for three years for @questions as a
suggested user in the sign-up process.

Ground rules:

a) We post no more than three absolutely AMAZING questions to the
@questions account per day.
b) None of those messages can be an advertisement… 100% of them have
to be actual content.
c) If you discontinue the autofollow program, we’ll take the $500,000
in followers at .10 each (i.e. 5m).

If you’re one of the 17 who made it to the bottom, I’m wondering what you think:

1. Am I crazy, or crazy like fox?
2. What’s the value of a Twitter follower?
3. What’s the value of of being one of “The Suggested?”

The way I see it, there are two ways to win the pot: raise or have the
best hand–in this case I think I’ll do both.

all the best,

Jason McCabe Calacanis
CEO & Founder, Mahalo.com

77 thoughts on “Why Twitter's 'Suggested Users' is the Next Superbowl Ad (or "Calacanis offers $500k for three years")

  1. Without necessarily buying your math I totally agree directionally. The frequency, intimacy, and immediacy of the twitter-reader relationship is a goldmine for anyone wanting attention.

  2. jason, you know twitter would never accept this, but despite that this is a great post, because:

    A) it would totally be worth it;
    B) it’s great linkbait either way.

    @julien 🙂

  3. NW Ayer & Son, New York created the “You Will” advertisements.

    They are now defunct, but responsible for some awesome campaigns.

  4. What I would like to see with Mahalo Answers is integration
    with Facebook Connect. So when I ask / answer a question,
    it then gets posted to my Facebook wall / newsfeed
    and lets people know I answered a question / posted a
    question at Mahalo answers.

    twitter: @mcalvey

  5. Hey man

    Wicked post, pretty much agree with everything you say. I’m
    from New Zealand, mainstream public down here are still
    getting their heads around what twitter is. I think once the
    marketing gurus undertand/realise the power of what your
    talking about we’ll get a heap of kiwi companies jumping on
    the bandwagon.

    Offering a wad of cash is pretty genius, you must be stoked
    with the publicity it’s generated. Looking forward to see how
    twitter reacts.

    @pranilsingh 🙂

  6. I think Twitter should take you up on this, and use it to make the company profitable. This is something that could work for Twitter, and it would be a lot less intrusive than selling advertising on the site.

    I hope the Twitter folks are listening.

  7. I think you are definitely out in front of what could be a game-changer in marketing. I relate it to the Google targeted ads. If I’m going to view an ad, I’d rather it be something I’m highly likely to be interested in. Brands that figure out how to use Twitter to enrich the experience of their target users are going to be big winners.

  8. Excellent post with compelling ideas! I think that your math is probably on par. If you have the money to make it happen then why not put the idea out there and give it a whirl. Like you said; if nothing more you’ll get a ton of free press because this is an interesting story.

  9. Defaults are extremely valuable. i.e. IE bundled in Windows.:-)

    3 years is a long time… twitter should just action the
    default suggested user off every week. As the service grows
    the prices will grow and they do not have a commitment
    before price discovery lets them figure out the value.

  10. I think your post is fair in regards to how much traffic
    your will drive to your website and monetize. However, I
    think that this “re-raising” is just link bait and a ploy
    to garner more attention than this topic deserves. I believe
    that Twitter will create business models which supersede this
    direct marketing to followers. I believe that Twitter will create
    a subscription business model for businesses that will produce
    analytics based on their Twitter accounts. This will not alienate
    the end user like this idea will. Just a thought!!
    Best of luck

  11. jason, you are marketing scum. go rot somewhere under imaginary piles of money, and may your last thought be “i fail at life”.

  12. Totally agree with your message. The “opt in” nature of twitter
    absolutely takes it to the next level. The increasing notoriety
    in popular media is pushing it to the tipping point. I’m sure
    the Twitter folks are grateful for the press, but if they actually
    took you up on the offer it could jeopardize the “trust” value
    of the list. However, if they are pimping Britney, the “trust”
    value of the list may already be a moot point.

  13. I’m curious… would you be willing to pay as much per impression for a similar spot in one of the popular online email services or is there something specific to Twitter that makes them a more attractive place to acquire customers? If Gmail had a suggested email subscription feature, would you pony up?

    My hunch is that if Twitter offered this feature, consumers would become wary of that page over time after realizing that it’s a paid advertisement. The opt-in rate for suggested users is relatively high today because it’s perceived as an unbiased recommendation, not an ad.

  14. Great blog post. Twitter will likely never take your offer, but your bid is kind of like the casinos who pay too much to buy the toast that is shaped like the Virgin Mary. It makes for cheap advertising. Proof in point? It prompted me to visit Mahalo.com for another look.

  15. Yes, I’d have to agree with you: Twitter is the next marketing frontier… which is too bad I think.

    Although I’m a marketer, there is something to be said about not polluting a space that people gather, with attempts to ‘monetize’ them. It is inevitable, however. Twitter eventually will accept money, from you or someone else like you, JetBlue, Zappos, or Appular (my company), because it has investors, and they are expecting a return on their investment.

    Until that time, I’m enjoying Twitter in it’s relatively pure form. Does anyone remember email before spam? Me neither.

    btw, I’m typing from 38,000 feet in the air somewhere over Iowa. I’m amazed by technology every day.


  16. One issue I have with Twitter followers is that people tend to follower so many accounts that most individual messages are lost in the wind. This argument may be mute in light of your click-through statistics, but there is also a chance that the longer people are on Twitter, the more people they will follower, and the less each individual follower will be worth.

    Regardless, the PR you are getting from this is probably worth more than a recommended account anyway.

  17. What’s the value of of being one of “The Suggested?”

    I think it has little value. The new followers are random. A small percentage might be listening, and that percentage will decrease as the volume of Twitter users inevitably increases.

    I know business people like to think everyone is listening to their marketing messages, but they are not.

    P.S. I think the suggested page was a brilliant move by Twitter because it makes internet personalities, celebrities, etc, so livid that they are driving their established audience to Twitter to increase their follower counts in order to outdo “The Suggested”.

  18. The naysayers have not thought it through like this…there is
    something about Twitter that has always struck me as being
    a true game changer and not for the obvious reasons. Its more
    than a BBS.

  19. I generally agree with you. To answer your questions, I would say that a Twitter follower only has a relative value depending on its profile (interest, income, location, etc.). The value in your idea is truly to be “The Suggested”.

    I would add an element to your proposal: twitters should be able to have preferred followers. If it becomes possible, I’d like you to preferred me!


  20. Hello Jason,

    You may probably have started a new market for domainers …
    Already Twitter IDs like support, client, customer, service, etc… are taken 🙁


  21. Jason. Great ideas! 🙂

    btw: I have the twitter accounts @question and @answer in my control and I’ve been waiting
    for a way/api to do something cool and interesting with them.
    Maybe Mahalo might like to ‘sponsor’ the development of something
    cool on them?

    please do drop me a line 😉 [@kosso]

    You also might be interested in something else I’ve concocted
    see : http://twitter.com/kosso/status/1353525707

    I also created a (possibly the first at the time) Twitter ‘bot’
    at @dictionary – which was a pre-concept for the question/answer accounts.

  22. 1. Not crazy – it was a smart move
    2. Don’t know – I would probably give 5 cents on a good follower.
    3. —-

    One thing it is certain: U’ve got press coverage with this announcement. Also, u’ve made a point on a possible direction regarding Twitter future revenues.

    My question for you is: Did you see a boost in followers in this period ?

  23. i love this idea. there are many ideas floating out there
    how twitter can monetize their service. I was thinking charge
    corporations but not indivduals, and this is similar to that
    concept. However I like the fact that you are offering
    content, not simply coupons, though users will appreciate
    both. I just learned recently that the most searched term on
    google for years was Britney Spears, and just this year has
    become coupons. It’s all about going where your customers
    are instead of driving them to where you want them to go.
    As Morten Lund says, remember it’s simple, but not easy.

  24. Great post.
    Is 250k to twitter really the best way to gain followers though?

    What if you spent that money in giveaways for stuff related to questions.
    IE, someone asks what the best digicam is, then say one of the people that answer
    will win a Canon SD-xx camera.

    At least that way if people followed, it would be more of a direct
    interest opt-in instead of just seeing @answers when they first sign up.
    Cause who really cares about Tom?

    Speaking of, why doesn’t Myspace do this with their auto-add friends when a new account is created for
    myspace profiles for fashion or music?

  25. Jason,

    You’re making a rookie mistake, no? Early adopters (which is the entire current userbase) are apt to be much more interested than your “regular” consumer who will come later on. Not to mention, once even one of the suggested followers is known to be a paid position, the overall value of that section will dramatically decrease.

  26. i question where you’re coming up with these click through rates. i think you’re over-estimating the potential. industry standard ctr is .2% and even with a more engaged audience i can’t see you getting more than a 1% click through.

    aside from that, as a online dm advertiser i really don’t care as much about my ctr as i do about my roi. typically this would be a cost-per-sale/cost-per-lead and i’m not convinced that twitter followers would be converters. from my own experience, and that of my friends on twitter, we click to get more information but not to make a purchase/commit.

    i think that until there are some solid, quantifiable marketing metrics put against an ad buy on twitter the smart marketer will hold off on offering sacks of cash just for a guaranteed placement in a list seen mostly by new users.

  27. Even if Twitter doesn’t take your offer. You have their attention and the attention of
    the media and many bloggers. And guess what, that didn’t cost you a dime.

  28. Right on Jason. I share your view of Twitter being the next
    Big social website out there! My own prediction is on the
    New Twitter Search being bigger then Google Search itself.
    Why, because it has something Google does not have, instant
    search on what is happening Now in the World! Newspapers
    around the globe are now looking for Twitter News Hounds to
    provide them with News as it happens. Businesses are flocking
    to Twitter by the thousands for many reasons but also
    because they can participate and hopefully succeed in one
    of the biggest social marketing experiments ever. Good luck
    with your $500,000 offer to Twitter. I hope they accept, as
    you probably won’t be sorry to get all that traffic.

  29. Jason,

    I totally agree with you regarding the value of a twitter
    follower. It’s good to have some validation on this, and I
    do appreciate your conversion estimates.

    Click thru rates and conversions obviously increase when followers
    chose to follow your account organically.

    I would reason that a “adword” like ad placement would be of
    higher value, than that of being included in a long list of
    “suggested” users.

  30. 1. Am I crazy, or crazy like fox?
    crazy, very inspiring crazy!
    go for 1M 🙂
    as always, great read.
    i am very interested in the future of twitter.

  31. Twitter è uno strumento inutile se usato come replica delle vecchie campagne publicitarie, se
    usato come suggerisce Jason per creare una vera relazione con il cliente tutto cambia.
    Il problema che pochi “clienti” sono capaci di usare twitter (zappos è un buon esempio), in Italia
    telecom ancora mi manda la pub per l’adsl quando io gio ce l’ho… 🙁

    “AT&T 1993 “You Will” Ads”


    ps:we are waiting for another edition of “the monkey of the week” Jason!

  32. Call me a Luddite, but I don’t want auto-following on Twitter.

    I see and buy your valuation logic … but I don’t like the current
    recommended users. I don’t want those slots to be up for sale to the highers
    bidder, and I actually don’t want those slots to exist at all.

    How is it good for users to be forced to follow people or organizations
    that will not spout ads to them?

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