The ads, from about 40 brands according to a Twitter executive, "are served based on users' individually shown interests via an algorithm."
ClickZ used an excerpt from Twitter's blog to explain how the ads get targeted:
"Promoted Accounts are suggested based on a user's public list of whom they follow. When an advertiser promotes an account, Twitter's algorithm looks at that account's followers and determines other accounts that those users tend to follow. If a user follows some of those accounts, but not the advertiser's account, then Twitter may recommend the advertiser's Promoted Account to that user. For example, a lot of people who follow several gaming-related accounts also follow @xbox. If someone follows gaming-related accounts, but not @xbox, Twitter may recommend @xbox to that person."
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