Twitter acquires TellApart, ad technology startup, for $533 million in stock

By | May 4, 2015

On Wednesday, Twitter announced to acquire TellApart, a marketing technology startup Inc for $533 million in stock. This acquisition could make it simpler for the potential customers to communicate with the digital advertisers through Twitter and also, it could serve as another media to improve its revenue generation.

Twitter buys TellApart

TellApart, a six-year old marketing software startup, is an expert in personalized, predictive marketing. It makes use of the internet browsing behavior with its tracking technology  and displays advertisements accordingly. It generates hundreds of millions for its annual revenue through its retailers like Neiman Marcus, Brookstone, Pottery Barn and eBags. The best thing about the startup is that it functions on a pay-for-performance model, which allows the company to take a small portion of the purchase the ad has facilitated.

TellApart’s co-founder and CEO Josh McFarland said, “TellApart’s strengths in personalization, dynamic product ads, commerce data and with retail advertisers are strong complements to Twitter’s deep experience in mobile, understanding users and the app ecosystem.” The company bids on the expectation that the acquisition by Twitter will move towards a more fruitful and meaningful relation unlike the one it had with Facebook. The acquisition deal is expected to be closed on June 1.

The social media company plans to use the ad agency to focus on promote cross-device targeting and online/offline measurement which will help advertisers to reach the audience no matter where they are and have an assurance that Twitter can get credit no matter one sees an ad or makes a purchase. Apart from TellApart being an extended portion of the current software, it permits an easier mode of transition between users of web applications and those using mobile phone. Simplifying the process of buying Twitter ads that too from a popular tool like TellApart, would definitely boost the revenue of the company which it is in need of right now.

Despite of Twitter having a wide range of users of more than 300 million including very popular, influential, wealthy celebrities, the social media failed to generate revenue. This hindering of its monetization is mainly because of the company’s limited knowledge on biographical data for targeting ads and lack of good ad platforms like Google and Facebook. “Direct response advertising has been a major growth engine for our ads business over the last several quarters. We are confident that TellApart will accelerate that trajectory further,” said Kevin Weil, Twitter senior vice president.

Twitter is all pumped up with the acquisition adding on to it is the partnership with Google’s DoubleClick group. The DoubleClick feature will enable the measure and monitor the conversations that are encouraged by the Twitter activity for the advertisers. Through the DoubleClick Bid Manager, one can purchase the Twitter inventory.

Purchasing of ad technology like TellApart and forming partnerships with top players in the industry could help Twitter with what it is looking for and get hold of a better place in people’s lives. Twitter’s step of paying for the purchase in stock has save the company cash in hand which was around $3.6 million at the end of the first quarter.