This Tiny Tech Startup Has Figured Out How To Turn Twitter's Trove Of Free Data Into A Goldmine
But there is tiny tech startup in London that has come up with a way of monetising all the free data that is coming out of Twitter. It's a mobile app called "Twizoo." It helps you find bars and restaurants based on how good they are, how close they are to you, and how expensive the prices are. It's great for finding places quickly in neighbourhoods you don't know very well. (To pronounce it, think Twitter + Review + Zoo). Stephen Fry is a fan.
The most interesting thing about Twizoo is its incredibly clever - and incredibly simple - business model: Because it uses Twitter's data rather than its own user-data, it doesn't need a massive number of users to work perfectly. Twizoo works just as well when there is only one active user on the system as it does when there are 100 million. Yelp, Google+ Reviews and Tripadvisor need millions of users to continuously update the sites with their own reviews. But not Twizoo. "We've found on average there are seven customer 'review' Tweets about a restaurant for every one TripAdvisor or Yelp review," says CEO Madeline Parra, "so what we've done is create an intelligent layer and algorithms on top of Twitter that makes sense of all this- and recommends to users the best places to eat or drink in real-time."
In fact, Twizoo is currently in beta testing mode and has very few users. It has only launched in London so far. San Francisco, New York, Chicago, and Washington D.C. are coming next. The company was founded in Parra and CTO John Talbott founded the company in February 2014, and launched the app on Android and iOS simultaneously in July 2014. Twizoo is backed by just £250,000 in venture investment, some of which came from Paul Forster the former CEO of Indeed, which sold in 2012 to Google for $1 billion.
Twizoo taps into the Twitter API and sifts the data coming from the hundreds of millions of tweets created by Twitter's 281 million monthly active users. As people tweet about various bars and restaurants, it sorts those tweets by geography, by time, and by whether they are positive or negative. When users open Twizoo on their phones, they can easily see which venues are getting lots of good tweets, which ones are not, and how close they are.
Once you've picked a venue, the app uses Google Maps to guide you to nearby hotspots, and it ranks them by price, too. The fact that Twitter just partnered with Foursquare to improve Twitter's location targeting is likely to help Twizoo get better at this also.
The ranked venues are displayed as different-sized circles. A big green circle means lots of people are tweeting positive things. A small red one means a few people are tweeting negative things - and you should stay away.
Until now, only businesses have monitored social media reputations to help them make marketing decisions. Twizoo offers that power to consumers, for individual purchases. "There isn't company that's delivering social media analysis back to the consumer in a way that helps them solve a problem or make a decision," Parra says.
If any bar wants to advertise on Twizoo, the company can turn the venue's tweets into ads that appear on the app. Bars pay for any customer who sees an ad and then shows up inside the bar - where a beacon will ping the app on their phone.
Twizoo also uses tweets coming from bars and restaurants on Twitter to create ads on Twizoo - and bar owners only pay for those ads if customers actually walk in the door after seeing an ad on the app. So there is no risk involved for advertisers: They only pay for customers they actually get.
That's the genius behind Twizoo: It functions perfectly even when no one is using it, and it doesn't require advertisers to risk anything if they want to try it.
The "hottest" apps in the startup world these days tend to be dependent on their users. Secret, Tinder, Snapchat et al. all need huge numbers of people to use them continuously in order to maintain their usefulness. Twizoo only needs Twitter's continued existence - a much lower barrier.
It's a great idea for a mobile app business. But in broader terms, Twizoo also illustrates the way Twitter's platform, as a provider of data, can be monetised in any number of different ways - and that investors in TWTR have yet to figure this out.
Disclosure: The author owns Twitter stock.