Twitter Inc. agreed to acquire mobile-advertising company Tap Commerce, trying to profit outside of its main Microblogging service by expanding promotions on smartphones and tablets.
Twitter will pay $100 million to buy TapCommerce, as indicated by an individual with knowledge on the matter. TapCommerce targets individuals on their smartphones and tablets with ads for things they’re effectively expressed interest on the internet towards purchasing, urging them to finish the purchase.
Twitter which is facing abating user growth for its main Microblogging app has been acquiring companies to stretch the band of potential audience for its advertisers. The San-Francisco based company acquired Mobpub Inc., in October a firm that distributes advertisements on more than 1 billion smartphones. TapCommerce will send ads to more than 50,000 mobile applications as indicated by Richard Alfonsi, Twitter’s VP of global online sales.
The acquisition will enable advertisers to “access to additional off-Twitter inventory and buying opportunities,” said Alfonsi in an interview yesterday. “It’s another step in this bigger vision we’ve started to put together about mobile advertising.”
Alfonsi declined to make on remarks on the terms of the deal. Twitter’s arrangement to purchase Mopub for $350 million was its largest acquisition to date.
‘Declining User Growth’
Twitter's effort to keep up the pace of user growth has prompted a few changes in the organization's leadership, and was seen as one of the explanations behind the takeoff of Ali Rowghani, who resigned as COO a month ago. Alexander Roetter, who had advertising background, was designated as the new head of engineering at Twitter in May.
In the most recent quarter, advertising deals created $220 million of Twitter's income of $243 million. Twitter's shares have declined 36 percent so far, in the midst of worries that the company won't have the capacity to boost growth in sales and earnings.
TapCommerce is based in New York, was funded by Bain Capital, RRE Ventures, Eniac Ventures, Metamorphic Ventures and Nextview ventures.
Tapcommerce, situated in New York, was sponsored by Bain Capital, RRE Ventures, Eniac Ventures, Metamorphic Ventures and Nextview Ventures.
“Being a part of the Twitter team will allow us to dedicate more resources to developing our product and expanding our services, so that you can continue to deliver even more value from your campaigns,” Brian Long, chief executive officer of TapCommerce, wrote in a blog post yesterday.