Subscription advertising service

Twitter (TWTR) is testing a new self-serve advertising service called Promote Mode, which is aimed at small business advertisers that may not have the time or budgets to create sophisticated campaigns.

Unlike Twitter’s flagship self-serve advertising program, Promote Mode is offered on a subscription basis, and it costs $99 per month. An advertiser simply purchases a subscription, and Twitter takes care of running the campaign for them. In November, Twitter expanded its Promote Mode test, giving small business marketers in the United States (SPY) and the United Kingdom (EWU) the opportunity to try out the subscription-based automated advertising service.

Inside Twitter’s $99 per Month Subscription Service

Stabilizing top line growth

Twitter has long been reported as working on a subscription service as a way to tap recurring revenue and at the same time diversify its revenue sources. While Promote Mode isn’t exactly a subscription product that Twitter can pitch to its more than 330 million monthly users, it could be an important source of recurring revenue that will go a long way toward stabilizing the company’s top line growth.

Twitter’s total revenue fell 4.2% YoY (year-over-year) to $590 million in 3Q17, marking the third straight quarter in which its top line fell. In contrast, total revenues at Facebook, Alphabet, Snap, and Yelp rose 47%, 24%, 62%, and 19%, respectively, in 3Q17.

Marketing tool for small advertisers

While Promote Mode may appear to mark Twitter’s halfway move into the paid subscription business, the company’s chief financial officer, Ned Segal, explained at the recent UBS global technology conference that Promote Mode was just one of the marketing products that Twitter was rolling out to small advertisers on its platform.

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