Bitly began in 2008 by solving a simple problem for consumers: Links were too long for Twitter’s 140-character limit. So it shortened them.
As far as technical solutions go, building a link shortener is a project you could reasonably ask someone to complete during a job interview.
But the business of Bitly has never been so simple. Bitly encodes about 500 million links every month (including custom URLs like huff.to or pep.si), which across Facebook, Twitter, and all other sites generate about 8 billion clicks--and a myriad of business opportunities. What is the best way to monetize a service that has both hundreds of thousands of individual users and data that marketers are willing to pay for?
When Mark Josephson joined Bitly as CEO last September, the six-year-old startup still hadn’t really decided. “There was a consumer product team. There was an enterprise product team. There was a science team. No marketing team. And three salespeople who had no go-to-market strategy,” he says.
Bitly had launched a bookmarking tool (or “bitmarking” tool as the startup put it) for consumers in 2012. But it had been making all of its money on brand tools that keep tabs on where and when potential customers click on a marketer's links.
Other applications for that data, meanwhile, were still on the table. Perhaps, one idea went, Bitly could insert ads between a link and the page it leads to. Or, based on which links a user clicked on, build him or her a personalized magazine like Flipboard. For a while there was a trial product that could tell you, based on your history of clicking, what you would have clicked on in your social feeds had you seen it. And, for those frustrated with the constraints of the “Like,” there was Bitly for Feelings, a version of the link shortener that gave your followers some personal context about why you were sharing something.
Despite this hodgepodge of possible directions, Josephson says, “we were growing revenue and people were buying, and the business was not in bad shape. I was like, this is going to be awesome. We are going to stop doing eight things, focus on doing two things, and do those things really well.”
He decided that those two things would be shortening links and serving marketers. The consumer, data science, and enterprise teams merged and got to work on a new service Bitly plans to begin rolling out next quarter.
“Bitly Audience” (at least that’s the name for now) will tell marketers more about who is clicking on their links and allow them to use that information in their marketing.
When someone clicks on a Bitly link for the first time, the site plants a cookie on his her profile that keeps track of all the Bitly links he or she clicks on after that. So Bitly knows not only when someone visits a marketer’s site from a link, but also whether that someone has clicked on links from that marketer before. It can also paint a pretty good picture of who the clicker is based on what he or she has clicked on in the past. So with the new product, if Dunkin' Donuts only wants to target New England mothers, Bitly can tell them which of the people clicking on their links likely fits that profile. Then Dunkin' Donuts can buy ads to retarget them on other websites.
Bitly Audience will also allow marketers to integrate Bitly data with a CRM software like Salesforce so that if they want to, say, only send a discount coupon to people who have clicked on two links in addition to signing up for the newsletter or receiving a call from a representative, they can.
What Bitly has that other marketing solutions don’t is an ability to see its links everywhere. Google knows what you clicked on Google, but it is blind to sites like Facebook and Twitter. It doesn’t matter where a Bitly link goes--whether it is shared on social media or embedded in an article on the New York Times website, whether it is run through another marketing tool like Adobe, Buffer, or Percolate--the company can still collect data about it for marketers.
Josephson says he expects the first wave of the product, which will give marketers better insight into who is clicking on their links, will launch by the end of the quarter. He expects the other offerings, like CRM integration and the ability to retarget link-clickers by syncing Bitly data with ad marketplaces, to launch within a year or so.
“The direction of the company is about unlocking the value of social data for marketers,” he says.
It’s definitely not as much fun to talk about as, say, Bitly's really cute pufferfish logo, but Bitly Audience is, at the least, a short answer to what kind of a company Bitly wants to be.
[Short Pencil Image: Alterfalter via Shutterstock]