In a surprising move last week, Lithium Technologies acquired the social media measurement company Klout. The deal doesn’t appear to be officially closed, but most experts report that a deal has been signed and is waiting for the finishing touches. The most surprising fact about this acquisition is that Lithium has reportedly spent $100 million to buy Klout.
Founded in 2008, Klout measures social influence and assigns a score to each user ranging from 1-100, based upon the activity of that user’s connected social media accounts. Sounds simple right? Not exactly.
The question that most people have with Klout is how exactly is influence measured? Supposedly, there is an algorithm that measures influence, but people are skeptical about whether this algorithm is accurate. It’s also believed that there are many ways to game the system into giving higher scores. This skepticism has led many people to ignore Klout scores all together.
However, a $100 million offer is nothing to scoff at. Lithium Technologies is a software company that provides various tools that help companies manage social customer experience. They’ve worked with clients such as AT&T, Best Buy, Verizon and Acer. Clearly, Lithium sees Klout as a valuable social asset, especially considering Klout’s new services.
Recently, Klout updated its services to help users become more influential by focusing more on content creation. This move by Klout makes it easier for users to create, share and find relevant content. This is very different from their core service but in many ways it’s a much more valuable tool for individuals and companies alike. For example, one new aspect of Klout called “on the rise” alerts users about content that is on the verge of trending.
It’s easy to see how this could be an extremely important tool for companies. More importantly, it makes it easier to understand why Lithium would want to acquire Klout. Companies are constantly trying to create influential and interactive content. With Klout’s new services they’ll be able to have a better idea of what their audience wants to see.
As the deal nears completion, most people are still wondering how Lithium plans to use Klout. It’s easy to understand why people are skeptical of Klout scores, but with the introduction of their new services, Klout could be a very valuable tool for a company like Lithium Technologies and their clients.
In a world where social interaction is so prevalent, it’s important for companies to know where and how they can influence potential customers. It’s also important to know what type of people act as influencers to your consumer base. As a consumer takes a journey through your brand, they will be influenced in a number of ways. If a company can control those influences, they will have a better chance of converting leads into sales. At this point, it’s hard to say whether or not Klout is worth $100 million but there’s no question that it has potential.
Keeping this in mind, take a look at your online strategy. Do you know what influences your customers? If not, inSegment’s various services can help you create a unified online strategy that will positively influence your customers and produce results.