One of the most highly asked questions of any startup is “how are you going to make money?” This is true for any new company–you can’t just give away your stuff for free. Sooner or later, you’re going to need to find a way to monetize whatever you’re using. In marketing speak, we’re asking for the Return on Investment (ROI). So when businesses want to use social media services like YouTube, Facebook, and Twitter, they’re going to want to know what’s their bottom line. It’s fine to stick content on there, but how will it wind up being a good use of their money?
This is the exact issue that plagues some people when thinking about Twitter. Right now, the only means the average business has to monetize their Twitter strategy is through promoted tweets. But maybe that’s not enough…sure we know that Twitter is making money through their firehose and partnerships with other companies behind-the-scenes, but for brands eager to fully embrace the power of Twitter, they need another way to tap into their bottom line. And that’s where Chirpify comes into play…
Chirpify is a Twitter commerce platform developed out of Upstart Labs in Portland, Oregon by Chris Teso. Formerly known as Sell Simply, this new Twitter commerce engine will enable direct (person-to-person) payments, donations and retail sales transactions to occur right through the use of Twitter. I had a chance to speak with Mr. Teso for this post and as a person who worked in an interactive agency for a while, it’s interesting to hear about the philosophy behind Chirpify and his thoughts on how businesses would use this in conjunction with Twitter. But before we get into the insights and thought about Chirpify, let’s delve deeper into understanding how it works…
Chirpify is a monetization platform that integrates directly with PayPal in order to offer secure transactions on Twitter. In order to initiate payment or purchase, all one needs to do is to reply to a tweet using the following format: “@brandname buy product” or “@charity donate $5 to cause“. As mentioned earlier, there are three types of things that Chirpify can do for you: Twitter commerce, Twitter direct payments, and Twitter fundraising.
In this situation, this is an e-commerce type of situation where a small business might use this in lieu of, say, Square or Venmo to process payments for transactions. Right now it doesn’t seem to be an ideal payment mechanism for large, established brands, but if the Creme Brulee cart here in San Francisco or your local lunch truck was on Twitter and both parties were signed up to Chirpify and PayPal, you could easily and simply pay for your purchase simply by tweeting them and receipts would be sent to both parties. Other uses include purchases that one might make off of Craigslist or other small one-time transactions. Whether this can scale for franchise establishments like Starbucks or at Macy’s or Best Buy remains to be seen–and might prove to be quite difficult to do, especially with the logistics.
Twitter direct payments
Perhaps more for the individual than the commerce functionality, but this basically follows along the same premise, instead of a consumer-to-business, it’s more consumer-to-consumer. You’re at a bar and your friend asks to spot you some money for some drinks. To pay you back, your friend could simply tweet you and their PayPal account would transfer that stated amount into your PayPal.
Here is something that seems to be promising, especially in light of Square’s recent involvement in the political scene with Republican presidential candidate Mitt Romney and President Barack Obama’s re-election campaign. For anyone who wants to set up a fundraising campaign, Chirpify offers them this added option. It doesn’t have to be political in nature. It can be healthcare focused, nature and conservation, social change, etc. and it will help easily capture more funds instead of worrying about people losing interest just because they only have a credit card on hand. If people can’t give money via Twitter, a link may also be provided to a page where they can donate. I believe that white labeling is also an option for those who don’t want to have the Chirpify branding.
For businesses interested in using this service, they won’t have to worry about there being yet another system that they need to adopt separately. Chirpify offers deep integration with existing e-commerce applications including Magento for back-end fulfillment, listing, and transaction management. But, if you do need an e-commerce back-end with reporting, then you can use Chirpify’s system as well–they have a dashboard that can help. To begin using it, merchants need to simply click the “list on Twitter” button that they’ll find in their dashboard when drafting an item listing for sale. Inbound sales information will appear as either an email or part of the merchant’s back-end system and as a direct message on Twitter. You can specify the quantity of the products you’re selling and set the price that you want people to buy at. And you can also charge shipping & handling as well, but for the purpose of convenience and simplicity, Chirpify will only allow you set a flat rate for shipping & handling–if you wanted to set up anything based on where the buyer actually is, it’s going to need more logistical planning (i.e., it’s not as simple as you might think). Oh, and depending on the type of program you’re running with Chirpify, they’ll take a percentage cut of the sales you make.
So from the buyer’s perspective, what’s going to happen is that in their stream, they’re going to see a tweet kind of like the one shown on the left here. Then, if the buyer wants to get it, all they need to is to reply back with the word “Buy” and their PayPal account will send the payment to the seller. Now, I know what you’re thinking: why would I want to have my public tweets be telling people what I’m ordering? That’s a good question and Chirpify has a system in place where you could send a direct message to Chirpify and they would play the middle man to facilitate the transaction without it ever being a public tweet. And what happens if you decide to buy something and you never get it? Is it a matter of caveat emptor or buyer beware? Nope, Chirpify says that with PayPal’s buyer protection in place, you will have a guarantee that your money is safely transacted–otherwise, you’ll get it back.
But what happens if you don’t have a Chirpify or PayPal account and someone transmits money to you or you send money to someone who isn’t set up for the transaction? Well if they are on Twitter, an tweet will be sent to them saying that you have sent them money and they need to access it through an included link.
Today, Chirpify has launched its Twitter commerce platform and is ready for people to take it for a spin. It’s received some initial seed funding from the Upstart Labs incubator, but for the most part has been bootstrapped. Currently, they have at least one major company as a merchant customer, Powerbar, and they’re looking for more. Could this become the biggest competitor to Square and all the rest in the industry? Will Chirpify decide to disrupt the way payments are done and could they be the pioneer in finally breaking through in monetizing tweets on Twitter?
There’s only one way to find out.