SMARTER STRATEGIES

Dell's $3 Million Tweet

Eric Lundquist | Date: 06-12-09 | Comments

Dell used its 600,000 Twitter followers to earn $3 million. What does this success mean for Twitter in business and the business of Twitter?

OK, Dell didn't have one $3 million tweet; it actually was lots of tweets, but Dell's Twitter-in-Chief @StefanieatDELL made some waves this week by twittering up Dell's $3 million in sales directly related to Twitter. "Deal-hunters are especially attracted to Dell�s Twitter presence. Dell Outlet sells refurbished Dell products at great prices, but inventories fluctuate, making it difficult to know when products are available or on sale.

Dell Outlet uses Twitter as a way to message out coupons, clearance events and new arrival information to those looking for Dell technology at a discounted price," she wrote.

With 600,000 Twitter followers, it makes great sense to use that base as a place to quickly make offers and wait for the revenues to roll in. Of course, $3 million is not a big deal for Dell, but selling refurbs is a good, high-margin business, as you aren't paying for new components and manufacturing. Lots of refurbishment can be accomplished by simply wiping out data, reformatting disks and reinstalling a clean operating system image.

The bigger question is, What does the success of Dell's outlet mean for Twitter in business and the business of Twitter? Five points come to mind.

1. Customers want just the facts. The 140-character Twitter message limitation means no multimedia, no excessive art or text, and mostly a simple offer, a link and a price. Oh yeah, and you need to make sure you have someone on the other end of the Twitter stream who can respond quickly and be able to check inventory. The Dell lesson holds a lot of implications for small businesses that want to clear inventory. Whether the inventory is used cars or canceled dinner reservations, Twitter can offer a very efficient way to ping your customer base and make an offer.

2. Twitter doesn't need to make money from all this. It would be easy to say that by offering extended capabilities, by taking a cut of the action or by setting limits on the follower base that cost money to exceed, Twitter can finally find that elusive financial model that has consumed thousands of blog pages. Here's how Twitter will make money:

Someone will pay the founder a billion bucks for the company and they will make a lot of money. The new owner can start figuring out how to wield those Twitter profiles to charge companies access.

3. Twitter for business needs to be part of a business process. The Dell Twitter business needs an inventory system, a payment system and a smart marketing organization to make this all work. Letting the president's nephew oblivious to all around him become the chief Twitter is a waste of time.

4. You need to Twitter value. Customers don't want to hear about your political views, your sports commentary or your inane remarks about the weather. They want to know if the big concert tickets are suddenly available at a discount, if you are offering a two-for-one dinner with wine deal for those getting to the restaurant in the next 2 hours or which inventory items are suddenly on sale.

5. You need to build a follower base. You need to learn how to build a base, how to be a good Twitter citizen, to recognize scams and not to abuse the Twitter phenomenon.