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Twitter’s Acquisition Of TellApart Paves Additional Targeting Avenues For Retailers

Neiman Marcus, Pottery Barn, and Sur la Table come with the retargeting startup’s package — and Google's DoubleClick will help attribute those brands' ads.

Twitter’s purchase of retargeting provider TellApart represents another piece in the social media platform’s long-term plans to build its mobile ad presence around online-to-offline marketing.

Twitter aims to prove its ads can drive in-store traffic and sales.
Twitter aims to prove its ads can drive in-store traffic and sales.

The TellApart deal was unveiled during Twitter’s Q1 earnings report — which was marked by missed revenue estimates and a premature leak of its financials before the end of trading — and came less than a week after the microblog service’s investment arm helped lead an $18 million financing in beacon platform Swirl.

While Twitter certainly had a rough earnings day as investors battered the company’s stock over its weaker ad sales performance —  Q1 ad revenues were $436 million, while investors were looking for Twitter to end the quarter with $457 million in sales — but signs remain mostly positive that it can quickly turn around.

On top of the TellApart deal, Twitter also said that the targeted ads in its feed would be sold through Google’s DoubleClick ad exchange. The importance of access to DoubleClick’s platform means that Twitter will have a greater ability to attract biddable advertising.

As more local and get-data backed digital advertising is being funneled through programmatic ad channels, Twitter, despite its challenges in convincing marketers of its ease of use as a marketing tool, Twitter’s got the right partners in place to take better advantage of an emerging area of ad spending. The possibilities are particularly promising considering advertisers’ louder demands for platforms to offer a clearer view of the connection between online attribution and in-store visits/purchases.

Direct Response, Redefined?

Twitter’s immediate goals and reasoning for buying TellApart are included in a post on Twitter’s official blog. It all comes down to offering greater “direct response capabilities” that will allow marketers to “target the right users, drive action with creative ad units, and simplify the measurement of conversion performance across devices,” said the post’s author, Kevin Weil, Twitter’s SVP of Product.

While the words “direct response” tend to convey advertising that is cheaply sold and is of relatively low quality — as opposed to “premium” and lucrative brand campaigns from big name marketers — Twitter is hoping to redefine that view. The idea of direct response was clearly on Twitter CEO Dick Costolo’s mind, as he noted during the company’s analyst call following the earnings release that its “newer direct response products” had received a cautious response from advertisers.

By adding DoubleClick’s analytics and metrics, which can report “conversions” — actual sales tied to digital ads on its system — the ROI figures that come close to providing a degree of accountability could give brands enough cover to increase ad budgets going to Twitter.

Certainly, the company has attracted a lot of interest from major advertisers looking to reach its 302 million active users via new marketing tools such as an “analytics homepage” app and a quick promote feature that aims to make it easier for small and medium-sized businesses to get their content in front of more potential customers.

Tony Roma's social card: At a blogging event in 2014, the steakhouse saw half a million social impressions on Twitter in just 90 minutes.
Tony Roma’s social card: At a blogging event in 2014, the steakhouse saw half a million social impressions on Twitter in just 90 minutes.

Social Ad Expansion

But Twitter, which has 288 million active monthly users, also lacks the mass appeal of Facebook, which counts 936 million daily users. Secondly, Twitter also has far fewer advertisers — roughly 60,000 — compared to the 2 million marketers who bought placements on Facebook in Feb. 2015.

While the addition of TellApart to the fold won’t change those number overnight, the retargeting company appears to be bringing along some significant retail clients, including as Pottery Barn, Neiman Marcus, and Sur la Table.

TellApart, which was formed in 2010 by two ex-Google execs, Josh McFarland and Mark Ayzenshtat, is also a prominent Facebook Preferred Marketing Partner. Ads powered by TellApart’s predictive analytics software that run through the Facebook system could have enhanced placement when it comes to both social media platforms.

“A big part of what drives us at TellApart is the idea that consumers can find value in ads if they’re relevant, compelling and timely,” McFarland said in a separate blog post. “Indeed, we’ve based our business on getting paid only when users click on an ad they find interesting and then make a purchase from the advertiser. This is a part of Twitter’s core too, with their innovative native ad units that target the right user to drive the right engagement and action across devices.”

The deal is expected to close June 1.

For brick-and-mortar businesses that have been trying to figure out how to use all the various social media offerings that allow for greater one-to-one marketing, from Meerkat and Twitter’s Periscope apps’ potential to connect users with live, in-store events, on to Pinterest’s even more recent promise to serve as a catalog of where and what to buy, the choices just got a lot broader, if not simpler.

About The Author
David Kaplan David Kaplan @davidakaplan

A New York City-based journalist for over 20 years, David Kaplan is managing editor of GeoMarketing.com. A former editor and reporter at AdExchanger, paidContent, Adweek and MediaPost.