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Social media is maturing as a medium for advertising. The challenge is proving the return on investment and according to recent data, marketers using Twitter are only half satisfied with the service. Now that Twitter has gone public, it needs to show and prove its value and make its shareholders happy by keeping its customers happy.

Of course, this comes down to improving the service in a way that generates revenue. Fortunately, Twitter is smart enough to move quickly with those improvements, among which a tool that enables targeted advertising on the platform.

Senior Web Strategist for digital marketing agency Overit Tim Jensen, says that he had tested Twitter advertising and advised his clients against it because of the clunky advertising interface and the limited functionality. He says Twitter is so conversational, it’s hard to be too overt with the advertising efforts, especially when dealing with a general audience.

“If you’re going after getting more followers or pushing your brand out there, it works on that end,” he says. “But as far as something directly [tied] to ROI, I never found Twitter as effective.”

That was before the new retargeting tool was introduced. Now Jensen says you can get your message in front of people who have already shown interest in your brand. Essentially, the targeted advertising enables marketers to segment ads based on specific products and services.

Indeed, Twitter has been testing the tailored advertising tool since July to great effect. HubSpot saw a 45 percent increase in engagement; another company reported a 74 percent decrease in the customer acquisition cost; and yet another company reported a nearly 200 percent increase in conversion rates from the targeted ads, according to the Twitter blog.

The key to making the most of the new tool, Jensen says, is for markers to have a specific goal for what they want to achieve. He also warns people to keep in mind that advertising on social media is very different from other mediums such as search. Unlike search engine marketing, people on Twitter probably aren’t actively looking for a product.

“Twitter is more of a conversation and with remarketing, hopefully you’re reaching people in the right category. You still want to be careful not to be too aggressive,” he says.

Image credit: emiliokuffer