Twitter is Developing Geo-Targeted Ads for Retailers

Twitter Is Playing Catch-Up to Facebook On Location-Based Ads

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As soon as the end of the year, Twitter is planning to let brands show promoted tweets to people who open its mobile apps within close range of their stores.

Twitter will enable ads to be targeted to people who are near specific latitudes and longitudes and could be ready as soon as the fourth quarter, according to two people briefed on the product.

This kind of radius-based geo-fencing could potentially be useful for the likes of a pharmacy chain like Walgreens or even a quick-serve restaurant like McDonald's. It's for marketers who are looking to drive up their in-store traffic with the carrot of a deal or a special, or just by tipping people off to their presence in the immediate vicinity.

Though a release at the end of the year would make the product available for holiday retailers -- a potentially lucrative customer base -- it also seems subject to delay. Twitter currently only allows for ads to be targeted to specific metro areas and doesn't drill down to zip codes as Facebook has since 2011. Presumably zip code targeting is on Twitter's product roadmap and would be shipped before a tighter form of targeting is.

Twitter declined to comment on the product or the timing of its release. The company has been on a recent tear of putting new ad products into market -- such as keyword targeting to show ads to users who've tweeted a certain term and targeting for TV advertisers who also want to reach people who've tweeted about a specific TV show.

As the mobile ad market grows, so does the yen for targeting to make those ads more contextually relevant. It explains why Starcom MediaVest Group recently partnered with the startup PlaceIQ, which provides granular location data to help power mobile ads, to study the correlation between consumers seeing a mobile banner ad and walking into a store.

Sephora's VP-interactive media Bridget Dolan says geo-targeted Twitter ads could be used to alert people to in-store events and to new brands that have recently been made available in stores. While she notes that Sephora has historically used social-media advertising "extraordinarily sparingly," geo-targeted tweets could prompt a larger investment in Twitter ads.

"Whether you're looking at your phone because something popped up from [Apple's] Passbook or you're on Twitter, I think geo-local is going to help drive store traffic," Ms. Dolan said.

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