Omnicom Group Inc’s media services division signed a deal worth $230 million with Twitter Inc that will integrate Omnicom’s automated ad buying unit Accuen with Twitter’s mobile ad exchange MoPub.<\/p>\n
The two-year deal will lock in ad rates and inventory access for Omnicom agencies and will also give Omnicom a “first look” at new ad units and opportunities being developed by the microblogging site.<\/p>\n
The deal is expected to drive better pricing and targeting, said Jonathan Schaaf, president of U.S. Digital Investment for Omnicom Media Group.<\/p>\n
“Twitter’s been a major advertising partner for our clients in the past…(Omnicom) wanted to form a closer business relationship with Twitter that extends beyond just media buying.”<\/p>\n
Twitter confirmed the deal but declined to comment further.<\/p>\n
Wall Street Journal reported the deal first.<\/p>\n
“The news reflects positive business momentum for Twitter and the fact that Twitter can sustain its revenue growth independently of growth in numbers of users given Twitter’s uniqueness as a communications medium for marketers,” Pivotal Research Group analyst Brian Wieser wrote in a note.<\/p>\n
Twitter bought MoPub in September for $350 million in stock.<\/p>\n
Omnicom’s Schaaf said he expected mobile advertising to become a larger portion of overall advertising.<\/p>\n
“The average consumer spends a quarter of their daily screen time with their mobile device and it’s only about 10 percent of the total marketing dollars, so I’d expect that to level off.”<\/p>\n
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