June 1, 2011, 11:15 AM

Twitter buys an online ad company

The AdGrok acquisition is the second deal in eight days for the microblogging site.

Zak Stambor

Managing Editor

Lead Photo

Twitter, increasingly focused on generating ad revenue, has acquired paid search services vendor AdGrok. Neither company revealed terms of the deal.

AdGrok focuses on making the management of Google AdWords campaigns simpler for retailers and other marketers. But after the acquisition, AdGrok says it will shut down its AdWords management business and wipe out its servers by June 30. AdGrok’s team will begin working with Twitter’s revenue engineering team to build up the microblogging site’s online advertising technology.

AdGrok says it will not share its clients’ AdWords performance data and campaign structures with Twitter. Moreover, marketers that have run campaigns through AdGrok still can access them through the marketers’ own Google AdWords and Google Analytics accounts.

 “When Twitter approached us and asked if we’d be interested in working on their monetization platform, we realized that this was a once-in-a-lifetime opportunity that we just couldn’t pass up,” wrote AdGrok in the company’s blog. “The fact that the Twitter team is both smart and user-focused only made our decision easier.”

Twitter has not disclosed its plans for AdGrok, but its technology could be incorporated into Twitter’s Promoted Tweets ad service; the service operates similar to AdWords in that it lets advertisers place ads near tweets on subjects related to their products or services.

The acquisition is Twitter’s second in eight days after the microblogging site acquired TweetDeck, which provides a dashboard that enables consumers to monitor updates from Twitter, as well as other social networks such as Facebook, MySpace and LinkedIn.

Twitter has yet to detail its plans for TweetDeck. However, the acquisition may enable Twitter to monetize the conversations that consumers have through the dashboards. Twitter was previously unable to make money through placing relevant ads next to those discussion streams across social networks as its ad formats were limited to Twitter.com and its mobile app.

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