When Yahoo acquired Tumblr for $1.1 billion earlier this year, Yahoo’s CEO Marissa Mayer and CFO Ken Goldman both pointed out that advertising on the site (and revenues from those ads) would ramp up significantly in 2014 after a modest 2013. Today, we’re getting a taste of how Tumblr will do that: it has inked a deal with DataSift to provide a firehose of Tumblr data — including both real-time and historic data — to power consumer engagement analytics. In our increasingly ad-tech-fuelled world, this is essential data for brands and their ad partners when looking to buy ads against the 5.5 billion interactions that happen each month on Tumblr.
The deal is a timely one, coming on the heels of Twitter’s filing for an IPO and its own very sharp turn towards advertising-based revenue generation. DataSift is one of Twitter’s key partners in its own advertising ambitions.
Rob Bailey, CEO of DataSift, is not revealing the specific financial terms of the Tumblr deal, except to note that through it, DataSift becomes a content partner of Tumblr’s, similar to its relationship with Twitter. It was the Twitter deal, in fact, that led to this one. “We will do this as a revenue share agreement with Tumblr,” he said. “As a matter of fact, the great success of our Twitter has led to this deal with Tumblr.” He notes that it was a “mutual approach” from both sides. “Nick Halstead [the founder and CFO of DataSift] and I are both passionate users of Tumblr as well, so that helped.”
Looking at the Twitter deal gives a measure of how the Tumblr one will develop. There, Bailey notes that DataSift now provides distribution for Twitter into “hundreds of social and BI applications,” and that Tumblr “wanted the same success, the same kind of ecosystem, that Twitter has built around itself. It has been a huge accelerant to people spending money on the network.”
This is not Tumblr’s first deal with a big-data cruncher — it has what Bailey describes as a “much more limited deal” with Gnip (another Twitter partner). That, however, was more of a reprovisioning of portions of Tumblr data rather than the firehose. It’s likely to lead to more deals of its kind.
And similarly for DataSift. “There are more than 200 social networks with more than a million users worldwide, and all of them want to make money from ads,” Bailey notes.
Along with the firehose deal, DataSift is also providing consulting services on top to clients to better use the data.
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