Twitter Adds Coupons to Its Commerce Plans

Twitter has long said it works best as a tool for serving up news on what's happening, as it happens.

Now, Twitter hopes that will work with commerce on its network, as well. On Tuesday, the company unveiled a program that introduced deals to tweets on the 284 million-user social network.

The program, Twitter Offers, is aimed at marketers who want to drive sales directly through Twitter advertisements and is an attempt to kick-start Twitter's nascent efforts to build e-commerce into its platform. After buying a Promoted Tweet - a paid ad that appears as content inside a user's Twitter stream - a marketer can insert a deal, such as a time-sensitive discount, which users can redeem on their smartphone.

Twitter says it believes that for advertisers, the program will be a novel way to woo new customers to their stores.

'I think new customer acquisition is going to be the primary use case here,' said Nathan Hubbard, a former chief executive of Ticketmaster, who now leads Twitter's commerce efforts. Mr. Hubbard said that marketers could use Twitter's ad targeting software to focus on specific demographics of people who were most likely to buy products from their company.

The service is powered by CardSpring, a company that Twitter acquired in July that links coupons to a user's credit or debit card, and automatically redeems the deal when a customer uses the card to buy an item.

So, for example, if a user sees a Twitter Offer for an ice cream shop in their stream, they can link that deal to the credit card they have on file with their Twitter account. Later, if the user decides to visit the shop and buy a cone of rocky road using the same credit card, the Twitter Offer will automatically be applied to the purchase.

Twitter also stressed how easy it was to use the product. Merchants will not have to install new hardware to redeem offers, and users will not need to present a coupon at the point of sale in order to redeem it.

It is not Twitter's first foray into online commerce. The company announced it was testing a 'buy button' that would allow users to buy physical goods, like coffee mugs and T-shirts, directly inside of Twitter from a select group of companies. But that program has not been introduced widely since it was announced in September.

Offers, however, could prove valuable to Twitter by bolstering its advertising business, which makes up the vast majority of the company's revenue. As Twitter's pitch goes, the Offers program provides advertisers a concrete way to measure their return on investment; if a user redeems a coupon, that marketer will know their ad has worked.

While Twitter is starting small with a handful of retailers, its ambitions are much larger. Eventually, Mr. Hubbard imagines Twitter will rely on the location data in users' smartphones to deliver an advertisement with a Twitter Offer at the exact time a person is most likely to redeem it, including, perhaps, the very moment a user is walking by a retail store that has partnered with Twitter.

'I think location will play a huge part of this going forward,' Mr. Hubbard said.

While Twitter did not disclose the retailers it will begin working with on Twitter Offers, Mr. Hubbard said it would span a number of industries, including chain restaurants, big retailers and small mom-and-pop merchants.

The program will begin in time for Black Friday, one of the biggest shopping days of the year.