On October 27th, 2022, Elon Musk became the new CEO of Twitter after closing out a buyout that cost him $44 billion. Since then, his approach to the management of the company has been unpredictable, to say the least. The social media giant went from an extremely successful company to one that became disintegrating in less than a year. From job cuts, and server crashes, to the shedding of many of its employees, the company seems to have lost its steam. Not only that but Media Matters for America also reports that over 50 of Twitter’s major advertisers have pulled out of the platform. These 50 marketing companieshave spent more than $2 billion on advertising campaigns on the platform during the past two years.
Since Elon Musk’s takeover, the social media giant’s advertising has changed drastically. Although social media advertising accounts for almost 90% of the company’s total revenue, Tesla’s CEO has different ideas for this part of his company’s operations.
Read on to learn how Twitter’s Advertising has changed since the acquisition and how it will continue to change in the future.
How Twitter Has Changed
Job Cuts
Soon after Elon Musk’s takeover, Twitter began to go through a wave of job cuts to make the company more efficient. Twitter sacked over 7,500 people within the first month of Musk’s tenure at the company. The sacking spree was a huge blow to the company as many of these employees were experienced professionals who had worked for the company for several years. Elon Musk tweeted that he plans to fire over 50% of Twitter’s employees within the next 18 months to “place Twitter on a healthy path”.
Moreover, Musk also raised billions of debt funding the acquisition which made it more difficult for Twitter to retain employees. Therefore, it required cutting even more jobs in order to balance out the budget.
Firing Executives and Top Managers
As the sole director of Twitter, Elon Musk cleared out all the executive management teams to ensure that there is no controversy about the takeover process. He also dissolved the board of directors to ensure that no shareholders or other stakeholders would interfere with his vision for the company. CEOs, CFOs, and the head of advertising have been fired to streamline the management of the company. Musk also brought in a new team of associates and investors onboard to help run the company.
Coders
After the employee sacking, Must brought software engineers, coders, and other specialists from Tesla to Twitter. Due to overhauling the company’s management structure, it became necessary to hire specialists who can operate the social media site on a day-to-day basis. News agencies also report that coders at Tesla have also been working hard to redesign the social media platform to make it more user-friendly and appealing to a wider audience. They have been reviewing Twitter’s code and optimizing the app’s performance.
Advertising Changes
Since Elon Musk’s takeover, the social media giant saw a massive drop in revenue as a result of the canceled advertising campaigns and the reduced sales of its products. Not only that many PPC marketing companies paused their campaigns due to uncertainty surrounding its prospects and the uncertainty caused by the takeover.
From Volkswagen Group to General Mills, Pfizer, Mondalez, and General Motors paused paying to advertise their products and services on Twitter. Activists and organizations such as Anti-Defamation Leagues pressurized companies to rethink their relationship with Twitter. The job cuts and policy changes by Musk were the main concerns of some advertisers who decided to cancel their campaigns on social media sites.
However, Elon Musk has other plans for the company. He is planning on exploring other revenue sources including a subscription service, digital advertising, mobile advertising, and venture capital investments. These initiatives will help support the company’s revenue and improve its profitability in the longterm.
Verification of Accounts
Whereas previously Twitter only allowed celebrities and public figures to have verified accounts, Elon Musk has changed the policy and indicated that everyone can become a verified account, however, it will cost $8 per month. Elon Musk announced, “Twitter’s current lords & peasants system for who has or doesn’t have a blue checkmark is bullshit. Power to the people! Blue for $8/month.”
There are currently over 360 million Twitter users and over 200,000 of them are tweeting from a verified account. This is another revenue initiative that will add to the company’s bottom line and make them more profitable.
Monetizing Video Content
Elon Musk is also considering monetizing the video content uploaded on Twitter. This feature will allow users to pay to view video content. Both the content creator and Twitter can benefit from this feature as it will provide income to the creators and increase the popularity of the platform. However, there is a slight concern regarding copyrighted content and other legal issues that need to be addressed before this feature can be implemented.
If this feature is implemented successfully, it will increase the amount of revenue that Twitter can make from the service and help it grow.
Greater Emphasis on Interaction and Engagements
Elon Musk himself is an avid social media user and tweets daily. He aims to focus more on engagement and interaction for the app users through advertisement. From sharing photos to video content, he wants to attract more users and make them stay longer on the app. Engaging advertisement campaigns will potentially increase the ad revenue for Twitter.
Ad Free Paid Subscription
Elon Musk tweeted that advertisements will be removed from Twitter for those who sign up for a paid subscription soon. Ads have become too aggressive, especially for new users and those who are just checking out different accounts. Musk’s move demonstrates that consumers don’t like being pushed around by ads. The ad-free monthly subscription plan is a smart move for Twitter since it will make their service more user-friendly and encourage users to stay on the platform longer.
Elon Musk has seized the reins of Twitter, the advertisement-heavy social media platform, in a bid to clean up the company and make it more enjoyable for its users. The focus is shifting to other paid initiatives as opposed to using advertisements as the main source of revenue. This has sparked a lot of speculation over the future of Twitter’s advertising and business model.
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