Bloomberg News

Twitter Expands Advertising Tools With Keyword-Based Ads (1)

April 17, 2013

Twitter Inc. introduced a feature that will let advertisers reach users based on keywords in their postings, expanding the tools available to marketers on the microblogging site.

Keyword targeting will make it easier for companies to tailor promotions based on content, Twitter said in a blog posting today. The service aims to boost the relevancy of ads, rather than the number of promotions that appear alongside the website’s 140-character status updates.

Closely held Twitter, which is targeting $1 billion in revenue in 2014, is adding tools to help marketers tailor ads to users of the social-networking site based on their interests. The ability to promote products and services being discussed on Twitter increases the likelihood of the ads leading to purchases, said Debra Aho Williamson, an analyst at New York- based researcher EMarketer Inc.

“Twitter is where people go to get information in real time,” Williamson said in an interview. “By allowing advertisers to target keywords that people write in their tweets, it puts advertisers closer to that moment of intent.”

Ads based on user postings can be many times more effective than other forms of promotions on the site, said Kevin Weil, senior director of product at Twitter.

Targeted Tweets

In a test, GoPro camera maker Woodman Labs Inc. ran an ad triggered by tweets containing certain keywords which 11 percent of users clicked on, favorited or retweeted, Weil said. Typical ads on Twitter see a response from 1 to 3 percent of users who see it.

The results “underscore the intent that is inherent in users as they tweet publicly about what they are interested in,” Weil said in an interview.

Twitter has also shown ads for Microsoft Corp. (MSFT:US) and Walgreen Co. (WAG:US) targeted to user tweets. The system could be used to sell concert tickets or an album to a user who posts about their favorite band, Weil said.

The ads may also turn off some users if they are triggered by a keyword with multiple meanings, or whose meaning changes in light of a recent event, Williamson said.

“It would be unfortunate for people to see ads for travel to Boston when they were tweeting about what they saw happen at the marathon,” Williamson said.

Twitter is on track to generate more than $580 million in sales this year, with the majority of that coming from mobile ads, EMarketer estimates.

In February, the company said it would work with partners such as Adobe Systems Inc. (ADBE:US) and Salesforce.com Inc. (CRM:US) to sell ads using software that taps into Twitter’s ad platform.

To contact the reporter on this story: Douglas MacMillan in San Francisco at dmacmillan3@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net


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