Twitter acquired MoPub, a mobile app ad network, ad server, and real-time bidding exchange, for $US350 million in stock back in 2013.
MoPub has around 5,000 apps on its platform, and it works with publishers and developers to help sell ads within their apps, by plugging into a network of around 150 demand-side platforms (DSPs,) one of which is Twitter. Last year one analyst predicted MoPub will bring in more than $US500 million in annual revenue by 2017, up from an estimated $US56 million in 2014.
Yet MoPub is still one of Twitter’s best-kept secrets. The company doesn’t break out revenues from MoPub in its earnings report (it sits in the “data licensing and other category,” which generated revenues of $US147 million in 2014,) and it rarely releases news from the division, beyond quarterly marketplace reports about trends within the mobile app ecosystem, and a few other updates.
We sat down with Janae McDonough, MoPub lead and Twitter’s senior director of exchange, at the Cannes Lions advertising festival to discover more about what could be a huge cash cow for Twitter.
She pointed out three trends in particular that indicate MoPub is becoming a huge asset for Twitter: Engaging Twitter-like ad formats, its work to shift big brand dollars into the mobile app ad ecosystem, and expanding the reach of Twitter to a logged-out audience.
Standing out by using Twitter-like ads
One of the advantages of MoPub joining Twitter, McDonough told us, was the rich, engaging ad formats it provides.
Advertisers can opt to extend their Twitter ad campaigns — promoted tweets, that appear in the feed — to other mobile apps. So if you’re in the Talking Tom app, created by Outfit7, you might be served an interstitial ad in-between gameplay that looks like a promoted tweet.
McDonough explains the appeal: “[Tweet ad formats] are engaging and don’t look like every other stand interstitial. It provides relevant content, and the ad experience contains the kind of social features you don’t often get in an ad. You might think [with a standard ad]: ‘Great, there’s an image, maybe I’ll click on it, maybe I won’t’.”
Not only do the ads look different, but marketers can plug into Twitter’s data firehose, which offers information such as users’ interests, and the accounts they follow, that brands can use to target people on other apps more effectively.
MoPub also lets publishers sell other, more native ads too (native ads meaning they take on more of the look and feel of the individual app,) as well as banners, or video. Spend on video advertising on the MoPub marketplace, for example grew by more than 244% in 2014.
Moving brand dollars into the app ecosystem
When you think back to an ad you might have seen inside an app, you’ll probably remember seeing an ad for a mobile game, dating, or another form of ad.
McDonough says, by having Twitter as a demand source, MoPub is starting to see far more big brand money move onto its platform.
“The Twitter piece is unique in that it’s a social budget — one thing the main DSPs can’t tap into. Social budgets, a publisher like [sports app] The Score could never plug into because it’s not a social app. So that’s pretty differentiated,” McDonough told us.
As of the first quarter of this year, MoPub has seen a trend of brand dollars eclipsing other types of spend, especially around live events like the Super Bowl, or the Oscars, which mirrors Twitter and the real-time nature of its platform.
“During the Super Bowl, we saw a really interesting spike right before the game, and right through the game it was brand dollars coming into the exchange. It’s a safe assumption to say that some of the work Twitter has been doing around the [still in beta] Twitter Publisher Network [which the MoPub exchange sits on top of] has been pushing more brand dollars programmatically,” McDonough said.
That’s a clear win for Twitter: Brands have the biggest budgets, and through MoPub it is maximizing its share of their marketing spend beyond Twitter to other mobile apps too.
MoPub is increasing the visibility of Twitter beyond Twitter
MoPub isn’t just a monetisation platform for Twitter, it acts as a distribution platform too, increasing the reach of tweets to people who are not in — or may not have even downloaded — the Twitter app.
Last year, Twitter CEO Dick Costolo said that a lot of Twitter’s value isn’t just in its user numbers, but the size of its logged-out audience — the people who visit Twitter without registering but who also might see a tweet embedded on another website, printed in a newspaper, or spoken about on a TV show. In February, Costolo said a logged-out user was worth $US2.50 in annual revenue to Twitter, compared to $US4 for a logged-in user. And Twitter has previously pegged its logged-out audience at around 500 million.
MoPub claims its exchange reaches over 5,000 apps and 1.3 billion unique iOS and Android devices per month. That’s a more than healthy potential base of users to extend the reach of Twitter too, should publishers choose to serve Twitter-like formats via the MoPub platform.
Twitter has signed deals with Yahoo! Japan and Flipboard to extend promoted tweets beyond Twitter, and the company also recently renewed a partnership with Google to make tweets more easily discoverable via search.
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