Elon Musk sells ads to generate revenue
Since late October 2022 and the takeover of Elon Musk, Twitter has struggled to generate revenue. Several major advertisers quickly fled the platform in the face of risks posed by the social network’s new moderation policy. Moreover, these fears have been partially realized as Twitter has reinstated tens of thousands of accounts banned for disinformation or hate speech. Worse, Elon Musk’s political stances have made the situation worse, even though he promised to guarantee cautious advertisers.
At the same time, the businessman’s plan to rework the economic model of the social network to be less dependent on advertising, which accounts for almost 90% of the group’s turnover by 2021, has not yet materialized. The result: while waiting for a major restoration, the company tries to save the furniture with ephemeral offers.
Promotion: two for the price of one!
Before Elon Musk took over, 75 of Twitter’s 100 biggest advertisers spent nothing on the platform in the first week of 2023, according to software analytics firm Sensor Tower. Like this at the end of December. Among the figures of this migration are the car manufacturers General Motors and Volkswagen, the airline United Airlines or the pharmaceutical company Pfizer.
To compensate for these departures, Twitter offers discounts. according to The Wall Street Journal, the company launched a big promotion in mid-December: if advertisers spend between $250,000 and $500,000 on the social network’s advertising space, the latter offers twice as much! The only limitation in the agreement is that the envelope must be spent before February 28, and this is not random. On February 13, the Superbowl, the final of the American football championship (NFL), will take place, its non-stop show has become a cultural event in itself. Followed by more than 99 million viewers in the US alone, Twitter is the absolute top earner in the world of advertising in 2022. Better than Black Friday!
In addition to cost leverage, the offer aims to introduce brands to Twitter’s new advertising tools. Advertisers taking advantage of the promotion will have to use a filter designed to control the content around the ad, for example. They will be able to submit a list of up to 1,000 keywords, which the social network undertakes not to display above or below their ads. Whether these new safeguards are enough is difficult to predict: several studies show that the number and frequency of hateful content on Twitter has increased dramatically since Elon Musk took office. And at the same time, the social network will consider removing the blocking of political ads, despite the fact that Musk has stated that he is a conservative who votes Republican.
Twitter’s new owner has been saying for months that the company should be bankrupt by 2023 thanks to cost-cutting. But on the other hand, he warns his employees about the risk of bankruptcy, and uses this method in his other works. create a sense of urgency. After coming to power, the businessman cut 80% of his workforce, from 8,000 to 2,000, and he didn’t stop there. The company laid off dozens of workers again earlier this year.
But without advertisers, Twitter would quickly face a revenue problem, and while Elon Musk has hinted that he wants to be less dependent on them, he’s never been clear about his intentions for advertising space on Twitter. He hinted at a project to turn the social network into a “super app” like China’s WeChat. This change will include the arrival of a payment system, which the company has started to process. But the launch of the new version of the Twitter Blue subscription, which was supposed to serve as the cornerstone of the new model, was completely unsuccessful, in addition to causing a conflict with Apple over the commission received from the App Store. As a result, the social network increased the subscription price from 8 euros when purchased on the web version of the site to 11 euros when purchased from the application on the iPhone. This price increase, which went into effect at the beginning of the year, has upset some of Twitter Blue’s few followers.
As structural changes are not received or delayed, the company is trying to make a breakthrough. Elon Musk has suggested that Twitter will auction off about 1.5 billion usernames (which take the form of @elonmusk, for example) used by long-dormant accounts. Short names of two or three letters or number one names are now a rare commodity. They also regularly attract hackers, who manage to sell them on the black market at exorbitant prices. Ironically, the company also auctions off 631 objects from its offices between January 17 and 18. Lots up for grabs include bright neon with the band’s logo, a pizza oven or computer equipment.
Musk continues to rock Twitter
To transform Twitter, Musk continues to shake its foundations. As of early 2023, the site will no longer allow tweets to be displayed in chronological order, and today must allow messages of more than 4,000 characters with just 280 characters. This would be a big change for a social network where the brevity of messages is a differentiating element. In addition, Twitter is already testing virtual currency Corneraround it revolved new mechanisms for paying creators, as well as existing ones (subscriptions, donations, etc.).
Meanwhile, Twitter has since Saturday cut off access to its API, an interface that allows third parties to access certain data, such as the publication of tweets or trends. As a result, many services that aim to improve and facilitate the use of the social network no longer work. As the company has yet to release any information on the issue, some have concluded that it is a technical issue. But according to Informationthe cut will be voluntary.
according to New York Times, Musk again signaled to his team that he would have to approve any changes himself. However, he announced on his Twitter account that he would be stepping down as CEO after a hasty poll, and under pressure from shareholders, he is increasingly interested in one of his other companies, Tesla. ” We will suffer until we get as close as possible to the perfect product. “, he wrote to the employees of the social network.