7 Things Agencies Must Know About Advertising on Musk's Twitter
Elon Musk’s new ownership of Twitter has been big news for the tech industry, the advertising industry, and pretty much anyone who uses the internet.
With so many rumors, genuine news, and rapidly changing policies underway from Musk’s leadership, people are left with a lot of questions — did he actually fire 75% of Twitter’s workforce? Can anyone with $8 buy a Twitter verified checkmark? Is this the death of Twitter or the start of a new beginning?
In the middle of all this chaos are the people who generate profits for Twitter: advertisers who are nervous about the future of Twitter and their role in it.
So if you’re an advertiser or marketing agency who’s wondering where exactly you should stand in this mess, fear not — I’ve got the scoop on:
- What exactly Elon Musk has changed (so far) during his time at Twitter.
- What these changes mean for advertisers and marketing agencies.
- The pros and cons of using Twitter for advertising moving forward.
Let’s get started.
A Brief Summary of Elon Musk’s Twitter Takeover
Before I get into how advertising on Twitter has changed as a result of Musk’s leadership, I should review exactly what’s happened so far.
Here’s a super brief timeline of how Elon Musk got to be the new CEO of Twitter:
- January 22, 2022: Musk begins buying shares of Twitter on a nearly daily basis.
- March 26, 2022: Musk says that he is giving “serious thought” to creating an alternative Twitter-like platform, citing concerns over the platform’s dedication to free speech.
- April 5, 2022: After amassing a 9% stake in the company, Musk declines an invitation to join the Twitter Board of Directors.
- April-September, 2022: Musk engages in a back-and-forth with Twitter CEO Parag Agrawal and its board of directors over plans to buy Twitter. Offers are created, rescinded, and rehashed, even going so far as to include a lawsuit. Musk cites concerns over Twitter’s number of spam accounts and cybersecurity threats as reasons to pull out of the deal.
- October 27, 2022: Elon Musk buys Twitter for $44 billion. He ousts former CEO Parag Agrawal and other top executives.
- November 4, 2022: Musk lays off half of Twitter employees to cut costs.
- November-December, 2022: A series of changes and promised changes begin, including:
- A revamped verification system.
- A promise to rid Twitter of costly microservices, which Musk calls “bloatware.”
- The removal of more Twitter staff, including contract workers.
- Reinstating Donald Trump’s account.
Why Did Elon Musk Buy Twitter?
In an official statement directed toward advertisers, Elon Musk claims that he bought Twitter to “help humanity” and to create “a common digital town square”.
Source: Twitter
When this is combined with several other statements he’s expressed throughout the course of his negotiations with Twitter, it can be pieced together that other, more specific motivations behind this acquisition include:
- A desire to fix Twitter’s censorship policies over concerns that current policies limit free speech.
- A desire to fix the amount of bots, trolls, and other forms of nongenuine accounts in Twitter’s ecosystem.
- Plans to create an “everything app” based on Twitter.
So What Does This Mean for Advertising on Twitter?
Now we arrive at the question we all really care about: What does this mean for advertising on Twitter, and the people like you who create advertisements?
If Musk’s “Dear Twitter Advertisers” statement is to be believed, advertising on Twitter isn’t going away anytime soon, and advertisers will still be treated as valuable contributors to the platform’s function.
But real life isn’t so simple. Many large advertisers, such as Apple, General Mills, and Pfizer have limited or completely pulled advertising from Twitter after Musk’s takeover, with little to no explanation as to why (although it’s rumored concerns over new, loosened censorship policies are the primary reason).
So what do you as an advertising agency do in the middle of all this?
Here are four of the main changes Musk may make to Twitter and how it affects you as an advertiser
1. The Verified System May Turn Into a Paid System
During Musk’s short tenure as CEO of Twitter, the verified system has already gone through several iterations. The verification system originally used a payment-free model that relied on independently checking each account for authenticity.
Since taking over, Musk has changed the system to a paid model where users can pay $7.99 a month to be verified. This plan backfired when inauthentic accounts were able to procure verification, which caused the system to be paused — for now.
Although the future of Twitter’s verification system is unknown, it’s likely that Musk will continue to change it and move it toward a profit-motivated model.
Some implications of this for advertisers include:
- A higher risk of people impersonating your company’s official account. (although steps have been taken to prevent this from happening in the future)
- A higher risk of advertisements and communications being wrongly directed toward fake verified accounts.
- On the positive side, more revenue generated from this venture may help boost Twitter’s overall future development.
However, on the whole, this feature shouldn’t affect advertising too much.
2. Content Moderation Might Change or Lessen
In the past, Twitter has come under fire from all directions for its content moderation policies. Some say the platform censors too much, while others believe it doesn’t censor enough, and still others think it censors enough but just not the right things.
Elon Musk believes Twitter’s censorship policies are too stringent and has expressed that he intends to make the platform more open, less censored, and more supportive of free speech.
Musk has already investigated and changed specific instances of censorship, such as his reinstatement of Donald Trump’s account. He has also expressed that despite loosening restrictions, he doesn’t intend to let hate speech proliferate.
However, concrete long-term plans for exactly how he intends to change the platform’s content moderation policies remain to be seen.
In any case, it’s safe to assume that at least some change will happen to Twitter’s content moderation, likely in the direction of decreasing censorship.
This can affect advertising on Twitter in mixed ways. For brands who are very concerned about what kind of content their ads end up next to, Twitter may not be a great choice.
For example, brands who deal with a PG audience, a religious audience, or a politically vocal audience, may be uneasy about an ad of theirs appearing next to a crude joke or content that doesn’t align with their values.
But for brands who don’t care as much about where their ads end up, or even brands that already identify with values of free speech or unique (or even fringe) audiences, this may open up a new era of reaching a larger audience with Twitter.
For example, a politically neutral soft drink brand, an adult entertainment company, or brands that have previously been negatively affected by Twitter’s censorship policies may see a renaissance in accessing new audiences.
3. Dependence on Advertising Might Lessen
Although Elon Musk’s “Dear Twitter Advertisers” statement implies the opposite, Musk has been very open about his disdain for advertising in the past.
Source: Twitter
Elon Musk has previously expressed that he isn’t a fan of ads, and he has clearly taken measures to increase Twitter’s profitability in other places. This signifies that he wants to lessen Twitter’s dependence on advertising, which currently makes up a whopping 90% of Twitter’s revenue.
While the plans for limiting the focus on advertising are still up in the air, if Musk is to fulfill his ideas of creating new revenue streams for Twitter, Twitter’s advertisers may be concerned about:
- Becoming “second class” customers of Twitter — with less support and focus being put on ensuring advertising on Twitter is easy and effective.
- A lack of focus on developing quality targeting and data collection technologies to assure ads reach the right audiences.
- An overall shift in the platform’s culture to be more hostile to advertisers — both in terms of the company’s plans and the users’ attitude toward ads.
However, whether he actually lessens support for advertisers remains to be seen. It’s also possible that he may improve Twitter’s advertising capabilities in the long run, a venture that can be bolstered by using funding from other revenue streams.
So, overall, advertisers should tread cautiously, but at this point, there isn’t too much to be concerned about.
4. More Bots and Troll Accounts May Be Removed
Elon Musk’s concerns over the number of bot accounts on Twitter was a key aspect of his negotiations to buy the company. Moving forward, one of his primary focus points in changing the platform is to greatly lessen or completely eliminate the population of inauthentic bot accounts.
Out of all of Musk’s proposed changes, this one will have the most positive impact on advertisers — if it can be followed through with successfully.
A reduction in inauthentic accounts will:
- Increase the amount of genuine users your ads get exposed to.
- Improve targeting and user data collection technologies so that your ads get shown to more people who are seriously interested in your product or service and less people who don’t fit your audience.
- Improve the community and culture of the platform as a whole, which may even lead to higher user engagement and user sign-ups.
- Help you measure your own metrics more accurately so you can assess what is and isn’t working in your sales funnel.
Has Advertising on Twitter Ever Been Worth It? Weighing the Pros and Cons
On the whole, Musk’s changes to Twitter bring a mixed bag of concerns for advertisers. Although some companies have already made decisions about pulling their advertising, it’s still a bit too early to come to any certain conclusions.
However, all this talk about Musk’s vision for Twitter may just be hiding a much more important and essential question: Was advertising on Twitter ever worth it, even before he came on board?
At AutoGrow, we usually skip out on Twitter in favor of Facebook and Google for pay-per-click (PPC) ads (see how we integrate these into our funnels here) — and even when we’re dealing with regular social media, we still don’t use Twitter that often.
We’re not alone in this choice — thousands of advertisers weren’t exactly stoked about Twitter’s advertising capabilities to begin with, and Musk’s changes haven’t helped.
Why? Here are some of the biggest pros and cons we’ve noticed with Twitter’s advertising.
The User Base Is Active — But It’s Small
Although Twitter finds its way into the news more often than its counterparts, the social media giant only has around 330 million monthly active users — which is barely anything compared to Facebook’s 2.96 billion and YouTube’s 2.6 billion.
However, despite its small size, Twitter’s user base is surprisingly active. Twitter has 206 million daily active users, compared to 1.9 billion for Facebook and 122 million for YouTube.
That means that of Twitter’s total user base, 62% are logged on and engaged with the platform nearly every day. For Facebook, it’s 64%, and for YouTube, it’s a measly 7.6%.
So if you’re looking for active users, you’re looking at roughly the same ratio Facebook offers — albeit at a fraction of the total number of actual people.
Twitter Offers Many Ad Formats — But So Does Everyone Else
Twitter, like many social media platforms, offers a diversity of advertising options. Alongside the option to create traditional, organic social media content, Twitter’s ad platform, Twitter Ads, gives advertisers the opportunity to create PPC ads in a variety of unique formats.
These formats include:
- Takeover Ads: These let your ad pop up as the very first thing people see when they open Twitter, and you can customize them to “take over” a specific conversation or trend.
- Carousel Ads: These allow you to add multiple images users can swipe through before deciding to click on your CTA.
- Amplify Pre-Roll Content Ads: Similar to YouTube’s format, these allow you to run a video ad as a pre-roll to popular video content on Twitter.
…And several others. Some of these formats, such as Takeover ads, are extremely unique to Twitter, and may offer an opportunity unavailable anywhere else that really works for your brand.
The downside?
Most other popular advertising and social media platforms also offer a variety of format options, including visual, video, audio, and static content. So while Twitter is keeping up with the competition, it isn’t exactly knocking it out of the park.
Twitter Has a Low CPC — But It Also Has Low Conversions
When you compare ROI across several popular platforms, Twitter stands out in one category: It has the lowest CPC, or cost per click. According to research done by Single Grain, its CPC comes in at $0.8, while Facebook’s is $1.72 and Google Ads is $2.32.
But cost per click doesn’t really matter if no conversions come from the click.
According to this same research, Twitter’s CTR (click-through rate) is, on average, lower than both Facebook and Google Ads (0.8% compared to 0.9% and 1.91%), while Twitter’s CVR (conversion rate) falls even further behind, at 0.56% compared to 9.21% and 2.7%.
(Source: Single Grain)
So when compared to the two most popular PPC choices, Twitter simply doesn’t hold up on some of the most important metrics — although, of course, how important these metrics are depend on your specific campaign goals.
The Bottom Line: Twitter (Usually) Isn’t the Best Choice
There are several other categories worth comparing between Twitter and other popular platforms, and your experience with these categories might vary. For example, some people love Twitter’s ability to target by keyword and find it superior to Facebook’s topic-only targeting, while others think this is less effective.
Likewise, each platform offers different analytics options, which may be more or less useful depending on your goals and industry.
Overall, in our opinion at AutoGrow, we don’t think Twitter is the best choice — in most cases.
Between its small user base, low conversion rates, and just-okay formatting options, we think you’re much better off using Facebook Ads or Google Ads to take care of your PPC needs.
And if you’re running an organic social campaign, we’ve found Instagram, YouTube, LinkedIn, and Facebook to be more effective.
However, that doesn’t mean Twitter is useless. If you:
- Are targeting a Gen X, millennial or (to a lesser extent) a Gen Z audience
- Are already familiar with Twitter and have had success with it in the past
- Have a brand that’s uniquely suited to the format of Twitter or an audience that hangs out on Twitter
- Have already used other platforms and want to experiment with something new
…Then Twitter can be a great advertising tool.
And with Elon Musk’s proposed changes, brands who:
- Share Musk’s values of free speech and limited censorship
- Aren’t picky about what type of content their ads are associated with
- Have a unique offering that pairs well with a known fanbase on Twitter
- Want to take advantage of a potential gap created by old advertisers leaving
- Have faith in Musk’s vision and are okay with riding out a trial-and-error period
…Might blossom during this new era of advertising on Twitter.
Conclusion
Elon Musk’s takeover of Twitter has made everyone a bit nervous, and unfortunately, advertisers are caught in the middle of it.
Although no one knows with certainty what the future of advertising on Twitter brings, you shouldn’t be too freaked out.
Many aspects of Twitter’s advertising process may end up completely unchanged, and the changes that Musk does decide to implement may present a golden opportunity for certain brands who share his values.
As for everyone else, well, the question comes down to your goals and strategies. For us, Twitter isn’t usually worth it anyway, but many advertisers have a different experience.
So tell me: Have you ever used Twitter for advertising? Are you planning on continuing its use after Musk’s new leadership?
Let me know in the comments below.
Keep AutoGrowin’, stay focused.
