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How PowerVoice Is Cashing In on Paid Tweets

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Writer and Author, Specializing in Business and Finance
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This story appears in the May 2012 issue of . Subscribe »

A former contestant on ABC's The Bachelorette, Reid Rosenthal uses his insight to live-tweet humorous commentary about the current season of The Bachelor to his 15,000 Twitter followers. As he does so, he sometimes slips in an endorsement for Netflix or the Jewish dating site JDate. That's because Rosenthal is one of a few thousand social media influencers paid by PowerVoice to plug products and services. The Birmingham, Mich.-based company, which launched in January, hopes to cash in on the intersection of social media and e-commerce.

For PowerVoice to be effective, the influencers have to remain honest with their audience, tweeting about brands and products that make sense--not to mention remaining in compliance with Federal Trade Commission guidelines, which require disclosure of paid endorsements. Rosenthal, for one, won't mess with his readers' trust. So far he hasn't lost any fans by adding "#ad" to PowerVoice tweets, but, he says, "I can imagine that if you just spam you'll start losing followers."

PowerVoice is the brainchild of brothers Andrew and Ryan Landau. Andrew was working in business development for Google Affiliate Network when he observed that a single recommendation of a product from key social media users drove a noticeable spike in sales. Ryan believed they could monetize that chatter; he convinced Andrew to quit his job, move back to their Detroit-area hometown and get to work recruiting influential personalities. Then they pitched the service to companies. In addition to Netflix and JDate, they landed Starbucks and Gap. PowerVoice received angel investment from David Farbman of Outdoor Hub, an outdoor-information website, and Aaron Weitzman and David Weinberg of Cactus Media, a performance-based marketing agency.

Campaign goals for clients vary. Some are seeking purchases or subscriptions; others are designed to get people to click on links, "like" a Facebook page, watch a video or take some other action. Brands usually set a monthly budget and run the program until the money is paid out.

For Rosenthal, this translates into roughly $5 to $15 when someone clicks on his link to sign up for Netflix or when someone joins JDate. "It's not enough to quit my job," he says. "But if somebody used the service who had 100,000 followers, then I could see how it would generate real money."

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