Many firms are excited about using microblog site Twitter. But will it actually help their bottom line?

IRISH BUSINESSES are rushing on to Twitter, but until recently it has not been clear if the microblogging website offers any bottom-line benefits.

The website’s format, where messages or “tweets” of 140 characters or less are posted, offers a simple way to communicate with customers quickly.

Over the past 12 months, the presence of Irish firms on Twitter has grown steadily, with most following a simple pattern: they use the website primarily to talk to customers and hope to build some extra business from that.

In August, Bus Éireann went one step further. It set up a Twitter account and immediately began selling discounted tickets. This tactic was not about building relationships and getting to know customers. It was a simple, direct way to reach customers at a low cost.

“There was a great reaction to the offers. We sold a lot of tickets very quickly and we could see how quickly word of mouth spread,” says Andrew McLindon, public relations manager with Bus Éireann.

Since the first offer seven weeks ago, Bus Éireann has sold more than 1,000 tickets through its Twitter promotions.

With Irish Rail’s increased use of web promotions and the constant challenge of private bus operators, Bus Éireann sees Twitter as a way to fight back against its competitors.

“We feel it’s definitely helped broaden our customer base. There are people on Twitter who would have never thought of using us before but, when you give them a good offer like that, it gives them a bit of a carrot,” says McLindon.

Bus Éireann has started using Twitter for communications purposes as well, but the primary focus remains generating ticket sales.

The benefit of the communications aspect of Twitter, while limited in its bottom-line advantages, is substantial. For example, it offers firms the potential to calm angry customers and keep them on side.

According to Martha Rotter, developer evangelist with Microsoft Ireland, Twitter “can be useful in getting people to share their experiences online, both good and bad”. And, she adds, “hopefully that will help in driving sales”.

But even a firm as large as Microsoft admits it has yet to work out what exactly is needed to make Twitter an effective business tool. “We are definitely still learning as we go along. We are definitely seeing more and more interest internally [in Microsoft] from people wanting to try it out and see how their communications strategies are working,” says Rotter.

The lack of a magic bullet should not put off businesses considering joining Twitter. Despite having more than 45 million users worldwide, the site’s own founders have even had trouble finding a way to make money from Twitter.

Finally, in July, the firm predicted that it hoped to be profitable within the next four years.

A similar long-term picture is at the core of the plans of most Irish and international businesses seeking to profit through tweeting.

“We believe that every way we can connect with our customers more will, over a longer period, help us build our market share,” says Kelly Caul, social media manager with Vodafone Ireland.

“We see this as a longer-term strategy to get closer to customers.”

For FBD Insurance, Twitter offers a way to incorporate some of its real-world strategies with the online side of its business. The insurance firm has been using Twitter and is attempting to build personal relationships on the web similar to those developed in person at its offices.

“Social media is about not being an anonymous institution but having personal conversations with people,” says Brendan Hughes, e-commerce manager with FBD Insurance.

“We share useful resources and information with people. We try not to have it as a hard sell but we have generated sales leads. Of the people who interact with us on Twitter, I’m fairly convinced that when it comes to their renewal time next year the majority of those people will at least give us a shout because we have that relationship.”

A study by mobile operator 3 Ireland found that 69 per cent of Irish businesses on Twitter use it to build similar relationships.

The number of firms using Twitter in this way is unclear, however.

Research by IrishBlogs.ie found that there were at least 21,000 Twitter accounts in Ireland, but this does not include those who choose not to reveal their location when they join the site. Further research is currently being carried out by IrishBlogs.ie and it expects the new figure will be more than double that amount.

Twitter users tend to be highly engaged with the service, presenting businesses with an opportunity to communicate with people in a way that helps spread word-of-mouth information about their offerings.

“Those that are on [Twitter] tend to be quite passionate about it so there’s a lot of excitement there,” says Rotter.

“We’ve seen that it doesn’t matter if your company is one person or close to 100,000, you can definitely get a lot of traction very quickly.”

But it is important not to get too caught up in the excitement being generated about Twitter, as it is often a case of preaching to the choir.

The 3 Ireland survey also found that 31 per cent of Irish businesses on Twitter had generated less than €100 from activities on the microblogging site. So from the bottomline perspective there is some way to go before Twitter makes a real difference.

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