Does Twitter's Takeover Mean Problems For Advertisers?


The expression “let the buyer beware” has taken on new meaning for current and potential Twitter advertisers since the announcement of Elon Musk's $44 billion acquisition of the social media site. Musk's free-speech stance and seemingly antagonistic view of advertising – having once urged its removal from Twitter, in a now-deleted tweet – suggests the site may become a less attractive option for brands going forward.


As it stands, Twitter – with 90% of its revenue, which reached more than $5.5 billion this year, driven by advertising – still fights for a significant share of global digital ad spending. It's currently at a 0.9% share, according to Insider Intelligence, while online giants Google, Meta and Amazon combine to take 74% of that spend, based on figures from Ebiquity reported in Adweek. Twitter also lags behind other social media platforms with the fewest worldwide users and least interaction and global mobile app installs down 3% from last year, according to measurement firm Sensor Tower.


For advertisers, most of whom prefer a media environment free of inflammatory, controversial or highly politicized content, the impact on Twitter once Musk takes over is of major concern. The fallout of Musk's push to encourage more free speech on the site is already occurring, with a rash of follower deactivations affecting several of the platform's highest-profile users in the past few days, as numbers for former President Barack Obama and singers Katy Perry and Taylor Swift are down by hundreds of thousands. At the same time, according to NBC News, follower totals for prominent right-wing politicians such as GOP Rep. Marjorie Taylor Greene were up by 100,000, while there remains speculation that Musk will restore former President Donald Trump's access to Twitter.


While Musk has not exactly been advertising's best friend, once having tweeted “the power of corporations to dictate policy is greatly enhanced if Twitter depends on advertising money to survive,” Twitter would still need ad revenue to survive. “The problem is that most consumers still prefer to view ads in exchange for free content, rather than subscribe to a digital service,” Insider Intelligence principal analyst Jasmine Enberg says, “and making Twitter subscription-only would change the entire framework for the service.”

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