Twitter Ad Sales Nosedive 59% as Elon Musk Continues to Inspire Mistrust
It all started out with a brag – possibly a joke – and ended with Elon Musk owning Twitter. Now,
It all started out with a brag – possibly a joke – and ended with Elon Musk owning Twitter.
Now, things are not going so well for the billionaire as he tries to turn around the sinking social media site.
And new data shows that things are getting worse instead of better.
Recently, Must said that things were improving at the social media company, claiming, “Almost all advertisers have come back.”
However, an annual presentation for the company show things are not as rosy as he’s saying they are.
Twitter’s U.S. advertising revenue for the 5 weeks from April 1 to the first week of May was $88 million.
That’s down 59 percent from a year earlier, according to presentation documents. Twitter has regularly fallen short of its U.S. weekly sales projections. The document shows that it often falls short by as much as 30 percent.
The New York Times reports, “That performance is unlikely to improve anytime soon, according to the documents and seven current and former Twitter employees.
Twitter’s ad sales staff is concerned that advertisers may be spooked by a rise in hate speech and pornography on the social network, as well as more ads featuring online gambling and marijuana products, the people said. The company has forecast that its U.S. ad revenue this month will be down at least 56 percent each week compared with a year ago, according to one internal document.
These issues will soon be inherited by Linda Yaccarino, the NBCUniversal executive whom Mr. Musk named Twitter’s chief executive last month. She is expected to start the job on Monday, four people familiar with the situation said.”
And Yaccarino is walking into a hornet’s nest.
The ad revenue for Twitter is absolutely vital, because as much as 90% of the company’s overall revenue comes from ads.
When Musk first took over the company, he promised to create “the most respected ad platform.”
However, in typical Musk style, he quickly alienated advertisers by firing key sales executives, spreading a conspiracy theory and welcoming back controversial banned users like Donald Trump and Kanye West.
Advertisers, spooked by the rise in hate speech and controversy on the platform, were hesitant to tie their brands to the seemingly sinking ship Musk was gleefully riding to the sea floor.
The New York Times adds, “Twitter feels increasingly ‘unpredictable and chaotic,’ said Jason Kint, chief executive of Digital Content Next, an association for premium publishers. ‘Advertisers want to run in an environment where they are comfortable and can send a signal about their brand,’ he added.
Some of Twitter’s biggest advertisers — including Apple, Amazon and Disney — have been spending less on the platform than last year, three former and current Twitter employees said. Large specialized “banner” ads on Twitter’s trends page, which can cost $500,000 for 24 hours and are almost always bought by large brands to promote events, shows or movies, are often going unfilled, they said.”
While the company’s revenue woes predate Musk’s takeover, it’s clear that his “by the seat of his pants” extremist behavior has turned advertisers away in droves.
Musk seems to have boxed himself into an echo chamber of conservative (and extremist) voices, and seems to be unaware that he’s fallen so far off the tracks. But advertisers are showing clear signs that Twitter’s descent into chaos and conspiracy is not good for business – and eventually, Musk will have to pay attention
Or Yaccarino will, at least.