Twitter Acquires Mobile Ad Exchange MoPub

The social media platform is getting ready for real-time bidding

Twitter confirmed the purchase of mobile advertising company MoPub Monday night, Sept. 9, its fourth acquisition of the year. The acquisition will make it easier for companies to advertise on Twitter.

“We think there is a key opportunity to extend many types of native advertising across the mobile ecosystem through the MoPub exchange,” writes Kevin Weil, vice president of revenue product for Twitter. 

The two major trends in advertising, according to Weil, are consumers switching to mobile and the industry shifting to programmatic buying. Twitter’s ad revenue already comes mostly from mobile, and according to eMarketer ad revenue was projected to hit $1 billion in 2014.

Advertising on Twitter currently comes in the form of promoted tweets or accounts, which gets your content to people who don’t already follow you. Advertisers need to manually set parameters like age and interest keywords in order to target buyers.

With MoPub, Twitter plans to build a real-time bidding system “so advertisers can more easily automate and scale their buys,” Weil writes. “Our approach is to show an ad when we think it will be useful or interesting to a user, and that isn’t changing.”

Twitter has been preparing for its initial public offering (IPO), which is expected to come in early 2014, and is branching out to better engage with advertisers. Zynga’s former chief financial officer joined Twitter this year as CFO and was reported to be negotiating with banks about handling the IPO.

Last week the company hired Google Ad Director Christian Oestlien, and last month Twitter announced its purchase of Trendrr, which tracks social media activity around TV programming. Earlier this year Twitter agreed to buy Bluefin Labs, a company that provides advertisers with social media reaction information, and purchased “We are Hunted,” a music streaming device, before releasing its own music application.

MoPub, which was acquired for at least $350 million in stock according to Techcrunch, serves billions of mobile ads on a monthly basis for publishers like BET Networks and WordPress. CEO Jim Payne wrote in a blog announcement that the two companies were a “natural match” given their mobile-first approach. 

“Twitter will invest in our core business and we will continue to build the tools and technology you need to better run your mobile advertising business,” Payne wrote.

Twitter was launched in 2006 and has since evolved far beyond its founders’ expectations. As a company with only about 6,000 users at the time, “you kind of had to believe that was a good idea or you didn’t,” said early investor George Zachary of Charles River Ventures. “And that’s why a lot of people passed.”

Twitter usage shot up in 2008, around the time of the presidential elections. Usage jumped from 400,000 tweets per quarter in 2007 to 1.25 million per day in 2008. The site now generates over 340 million tweets daily.