Klout Scores $200M in Lithium Buy

Just when you thought it was OK to ignore that score of influence assigned to your social media presence, Klout, the company behind the scoring system, is being acquired by Lithium Technologies for a hefty sum.

The companies announced the acquisition last week, and, while terms were not announced, Fortune suggests the deal is worth $200 million. So why is Lithium Technologies, an enterprise customer experience management company, interested in a social scoring startup?

The answer is pretty simple and goes back to what we -- sparked by news from Amdocs Ltd. (NYSE: DOX) -- discussed at Light Reading last fall: Your social clout matters because it is one way operators will judge your "importance" as a customer. It can affect the speed of response you get, the level of customer service, and the offers made to you. It's not about you; it's about your network and your ability to reach them. (See Why Your Klout Score Really Matters.)

Lithium describes Klout as "the pioneer in using big data to measure online expertise." It assigns a score to all its members based on a number of factors that determine their "social influence," including their reach, level of interactivity, and quality of content. It also has a Klout for Enterprise platform to connect brands with these "influencers."

That's what sparked Lithium's interest. The company's customers include Spotify , Skype, and Sephora, but the concept is just as applicable to telecom service providers that want to improve their reputation through customer experience management. That's what Amdocs was pitching back in October, showing off a proof-of-concept of its Proactive Care data analytics combined with social media insights. Keeping track of a person's online presence is a way to reduce customer care costs, improve the customer experience, and spread goodwill for the brand.

Of course, the opposite can also happen, which is why it's important to understand how to properly make digital part of the entire customer view. Either way, the acquisition is proof there's more to social media than cat videos and food pics. Klout is giving service providers 200 million reasons they should pay attention.

— Sarah Reedy, Senior Editor, Light Reading