Brief:

• Social media network Twitter plans to open its ad inventory to programmatic buying from outside platforms and agency trading desks, unnamed sources told Ad Age. If the company's plans come to fruition, Twitter will be the first social network to open its "walled garden" to programmatic technology, making ad buying quicker and easier.
• Twitter is testing the offering with agencies and brands and has plans to open its inventory to companies such as WPP, Dentsu Aegis and Omnicom, people briefed on the news told Ad Age.
• In its Q4 2017 shareholder letter, Twitter executives briefly mentioned an alpha test of programmatic buying as part of a broader plan to improve its ad offerings with better performance and measurement. By creating a direct programmatic channel to its platform, the company would be much more open than previously revealed, per Ad Age. In December, Twitter formed a partnership with demand-side platform The Trade Desk to let advertisers programmatically buy content in a pool with inventory from other publishers, MarTech Today reported in December.

Insight:

Social networks have tended to limit outside programmatic tech as a way of maintaining control. Facebook and Snapchat have their own automated ad platforms that are separate from the programmatic marketplace where ad inventories are bought and sold based on the changing needs of advertisers. Twitter's test could signal that the company is willing to surrender some of that control for the sake of growth.

In a potential bid to become more open to a smoother integration with agency trading desks and demand-side ad platforms, greater accessibility would let advertisers more easily ramp up or slow down spending on Twitter's platform depending on the success of a social media campaign. This openness is important for video ad placements, which has become Twitter's biggest source of ad sales. The company carries video programming from Bloomberg, streaming content from BuzzFeed and new programs from the NBA, People and Condé Nast, among others, are under development. Programmatic ad tech could make it easier for these companies to buy video ad space or brand placements in the shows.

For Twitter, the push for more programmatic sales may help the company drive revenue growth, as it's finally starting to make headway on a turnaround strategy amid stagnant user growth and slumping sales. Twitter estimates revenue will increase 6.2% in Q1 2018 from a year earlier, topping the 2% growth in Q4 2017 that was the first increase in four quarters, per Bloomberg. As Facebook makes continuous adjustments to its News Feed to emphasize posts from friends over publisher content, Twitter may be able to lure more content producers and marketers to its platform with ad tech that simplifies and streamlines the ad buying process.