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Twitter Expands Ad Business, Partners with AmEx Small Business

Twitter
Loic Venance | AFP | Getty Images
Twitter

Two years after Twitter started selling ads it’s getting serious about growing revenue by expanding the number and variety of advertisers who use its platform. Today the company is announcing that it’ll open the door for anyone with a credit card to buy ads on Twitter. It’s first launching a self-serve ad system, which it’ll first make available to 10,000 AmEx small businesses starting in March, before opening up broadly later this year.

Twitter is stripping away the barriers to marketing to its 100 million active users. It’s doing away with minimum advertising spend requirements and monthly commitments. Until now ads were sold over the phone, with businesses conducted via inter-personal relationships between the company and big brands or their Madison avenue representatives. Now the company is partnering with American Express, inviting small businesses to sign up at http://ads.twitter.com/amex, and giving away $100 in free Twitter advertising to the first 10,000 eligible card members.

Small businesses will be able to log into Twitters self-serve platform, set their budget and target geography. Then Twitter will promote Tweets in users’ feeds, and in ‘Who to Follow’ as it now does with big brands like Best Buy and Jet Blue. Small businesses will only pay for performance: Twitter charges when advertisers gain followers or users engage with their Tweets.

CEO Dick Costolo says small businesses have been “banging down the door,” begging for access to ads. He says that tests have found that Twitter ads work well for small businesses because these companies are already using Twitter—for free—to connect with fans and customers.

Giving AmEx small businesses access to Twitter, should be a win-win-win, says American Express Vice Chairman Ed Gilligan. By securing this deal he’s giving AmEx an advantage over rival services, while his customers get access to an easy way to amplify messages they’ve already been sending for free.

Twitter had an estimated $140 million in revenue last year, according to eMarketer. With this system in place Twitter could more than double that in 2012.

Tune in to CNBC on Squawk Box, Squawk on the Street , and Power Lunch, for more on Twitter’s strategy to scale its business.

Questions? Comments? MediaMoney@cnbc.com

  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.