Twitter’s recently announced IPO has stirred a series of vibrant online discussions. Some investors were so eager to get on board the Tweet-train that a stock called "TWTRQ" went up 1,500% because people mistakenly thought it was Twitter. That is both an uncomfortably hilarious reminder of our flawed stock market system, and a testament to the brand strength Twitter has built for itself. But in the world of viral marketing, where we can't tell which profiles are real and which are fake, how can the value of a social media site truly be measured?
Twitter has become one of the internet’s main marketplaces for breaking news bulletins, popular viral content, trending memes and hash-tagged nonsense. Alongside Google, Facebook, Reddit and Wikipedia, Twitter has securely claimed its corner of the web’s daily aggregation of information. In its issued IPO, Twitter claimed a 2012 revenue of over $316 million and boasts more than 200 million profiles (comparably, Facebook has 1.2 billion users and LinkedIn approximately 240 million.)
But a PR Week review of popular marketing tactics online found that at least 20 million of Twitter’s profiles are fake. In some cases, these are generated by spambots and phishers of personal data, who lure victims with profile pictures of attractive women and ominous links. But the vast majority are created by private companies that generate millions of dollars in profits by selling followers to advertising agencies hoping to influence online discussion of their products, or celebrities and politicians hoping to increase their social media standing.
As absurd as it may seem, there are several companies that can make as much as $1 million a week by creating 100,000 fake twitter accounts and selling their "followship" to the highest bidders. Politicians like Mitt Romney and Newt Gingrich have been accused of amassing artificial and sudden spikes of followers to seem more influential online. It becomes hard to distinguish the real profiles from the fake, because as man as 40% Twitter users follow people without ever tweeting themselves.
There is a massive and complex marketplace dealing entirely in fake followers and fake retweets, which speaks to the absurd way in which we value the perception of popularity online. Dozens of companies sell deceptions that are becoming more and more sophisticated, with software that can generate bios, pictures, tweets and human-like online behavior on bogus profiles. These companies include Fiverr, SeoClerks, InterTwitter, FanMeNow, LikedSocial, SocialPresence and Viral Media Boost, to name a few.
Batches of followers are sold in orders of 1,000 to 1,000,000 at varying price points, causing some experts to estimate that the business of selling tweet-popularity could be reaching profits as high as $360 million. That’s more money than Twitter itself made.
NPR ran a series trying to help people spot fake profiles, but the sophistication and pervasiveness of the software make it almost impossible to know for sure. Politicians, advertising agencies, PR Firms, celebrities and film studios alike, all have a vested interest shaping the perceived online discussion around products, events and their personal profiles. They hope that when real people see 100,000 re-tweets, they’ll judge their worth at face value. It’s the equivalent of writing yourself a Valentine’s day card in high school, sticking it on your locker and hoping people think you are loved!
So it seems that the real money to be made with Twitter is not in studying how humans exchange news and information, or sharing user data with advertisers, but rather in selling fake online entourages to attention whores and product pushers. Who needs Don Draper when you can purchase 100,000 retweets at $50 a pop?
(Sidenote: Goldman Sachs, Morgan Stanley and JP Morgan are among the underwriters for Twitter’s IPO, the very same banks that oversaw Facebook’s offering, and resulted in them getting sued by investors.)