Thursday, July 10, 2014

Twitter Goes Native

So, last month Twitter purchased Namo Media, which is described as a native ad specialist. What that means is that they make it possible for "native ads" to run in the apps designed for mobile devices. Their pitch to app makers is, "Turn your content stream into a revenue stream." The possibility of running ads within an app make not have occurred to many of the designers and distributors of games, utilities, and applications that run on smart phones, pads, and tablets. But perhaps it has. 

More to the point, sites and services that started up on the web and became platforms for advertising, for example Google and Facebook, have faced certain challenges in the mobile environment, because mobile displays either shrink the ads appearing on websites or cut them off entirely. Their answer to the problem parallels product placement in film and television, as it involves the web-based services injecting sponsored items into search results, or  status update streams.

The challenge posed by monetizing mobile devices is the reason that Facebook's stock value dropped significantly right after they went public. And this is especially a problem for new media businesses because more and more we all are accessing our social media and websites via our smart phones and iPads, not our computers.

Anyway, to get a quick update on the facts surrounding Twitter's acquisition, here's a Wall Street Journal article entitled, Twitter Buys Native Ad Specialist Namo Media.

So, I was invited to comment on this story for the "Today's Burning Question" feature run by Mike Daly for the website. Here is my response:

Launched in 2006, Twitter once led the way in integrating cell phones into its service, this well before most of us were sporting smart phones, so they have a particular interest in staying on top in the increasingly competitive arena of mobile applications. For a long time, there were questions about how they could monetize their service, and the answer they eventually arrived at, sponsored tweets, was not an unmitigated success. What we see happening today is a move away from single platform networks like Facebook and Twitter, and towards more specialized apps that are themselves networked together. Google has led the way on this, and with the purchase of Namo Media, Twitter can provide the equivalent of Google AdWords for mobile apps. Running ads in apps has become one of the main answers to the question of how to monetize apps for mobile devices, but nothing is more annoying to users than ads that appear to be entirely inappropriate, so using algorithms to determine ads that fit in with the content of the app is essential to its success. Whether Namo’s algorithms can compete with Google’s remains to be seen, but Twitter also needs to be concerned with Facebook’s aggressive moves into mobile territory through its purchase of Instagram and WhatApp. The one thing that is certain in the new media industry is that if you stand on your laurels, you will quickly fall behind.

You can read the responses of six others, all of whom are industry types and not academics like me, over on the Adotas site: Today’s Burning Question: Reaction to Twitter’s Native Ad Move.  The results were posted on June 9th. And maybe today's burning question should be, are you reading this on a mobile device?

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