Why Twitter's Bluefin Acquisition Is a Smart Move
Yesterday, news broke the story that Twitter has made its largest acquisition to date, buying the social analytics company Bluefin Labs for an estimated $70 million. With Bluefin’s technology, Twitter can now quantify social media engagement for a TV series, or any individual show – a big step towards turning audience interaction into revenue.
Today, the tech community was buzzing with frenzied analysis on the acquisition.
The general consensus? It’s a smart move.
In a post, Ad Age wrote that “the deal will give Twitter some research firepower to sell TV trends and conversations to brands.” And Peter Kafka, writing for All Things D, saw the acquisition of Bluefin Labs as a crucial development, providing Twitter with “a turnkey research operation, which it will need if it wants to fulfill its enormous revenue and valuation expectations.”
GigaOm outlined why this is a "perfect" match.
As Twitter has emphasized its ability to connect users with media and especially live television events, it has still struggled, like other companies including Facebook, to figure out how to measure the scope of those social media interactions...It’s still a question the company is figuring out, and one that Bluefin could help it answer as it works to build up monetization and partnerships in marketing and media.
Even a potential advertiser weighed in: Shiv Singh, Global Head of Digital for PepsiCo Beverages, wrote a (widely re-tweeted) analysis, in which he breaks down why the acquisition makes sense. One point he made:
Twitter wants to build its own measurement ecosystem...By acquiring a social analytics firm, Twitter is saying that it wants to control and own its own measurement destiny. It also sees opportunities to monetize its data more directly and doesn't want to leave that to Nielsen or anyone else.
He continued on this point of more control:
If there is any single thing holding advertisers back from spending more in digital and more in emergent social media platforms, it is the rather raw measurements of this space. There are too many measures, not enough standardization, limited co-relation to broadcast and other forms of media and in some cases weak ties to ROI. This issue is exacerbated among the social media platforms. Twitter and Bluefin both recognized this and this acquisition signals that Twitter believes that it can make measurement and broadcast measurement co-relation a differentiator. The other social platforms can learn from this.