When Yahoo Acquired Tumblr, I wrote about the Signal-to-Ads Cycle:
The result is the signal-to-ads cycle:
- Information is gathered from first-party sites via analytics, 3rd-party sites via ads, buttons, etc, and owned-and-operated mobile apps tied to your identity (think Instagram)
- Highly targeted ads are served in search results, display ads, and natively, primarily on PCs
At the time, Yahoo had lots of ads, but almost no signal at all; Twitter had the opposite problem. Great signal, some interesting native advertising, but not many other advertising channels.
That changed today with the acquisition of MoPub. From TechCrunch:
MoPub, a startup that helps mobile publishers manage their ad inventory, has been acquired by Twitter, giving the social network another route into building its advertising business, specifically on mobile platforms…
MoPub as a business works with a number of publishers to help them maximise sales and performance on their mobile ad inventory. For now, it’s unclear whether a Twitter deal would mean that Twitter would become the exclusive customer, so to speak, of this technology, or whether Twitter would use it as a way of branching out its own social graph on to other sites, and other Twitter clients.
I think it’s very likely MoPub is Twitter’s AdSense:
- Twitter has a great signal about its users: whom I follow is a great approximation for what I’m interested in. That’s even more valuable than whom I know
- Twitter is not a great platform for any sort of display advertising; the targeting would have to be much more precise than what is possible with current technology for users to tolerate anything more than promoted tweets
MoPub solves this riddle; Twitter can serve up highly targeted ads everywhere but Twitter proper. It’s a great acquisition.