How will Twitter Change: 3 Probable situations
Let’s just say that Elon Musk’s takeover of Twitter has been eventful. Unfortunately for Musk, when it comes to allocating their advertising money, corporations favour consistency over change.
Even though Twitter is not the largest advertising platform, it is nonetheless crucial to every brand’s marketing plan. Brands that already use Twitter marketing are understandably interested in potential future developments. In this piece, we’ll lay out the current state of the facts before speculating on some likely future events and provide advice for what advertising should do to be ready for each.
How is Elon going to alter Twitter? The current story
On October 27th, Elon Musk completed his $44 billion acquisition of Twitter, despite numerous attempts to back out of the agreement. After Musk insisted that they sign a “loyalty pledge,” thousands of employees have since been let go, and many more have chosen to leave the company.
His biggest innovation to date has been the $8 monthly launch of a new subscription service for verified accounts. Musk postponed the service’s launch after a number of spoof accounts paid the price and then mimicked well-known companies. The pharmaceutical company Eli Lilly’s stock price dropped 4% as a result of these moves after a parody account posing as the official handle of the business tweeted that “insulin is free.”
If there is a strategy at all, it is unclear to industry analysts what motivates Musk’s activities. Musk is most likely adapting the strategy that has worked for him at Tesla to a vastly different industry.
Tesla is renowned for not investing in advertising. Marketing expenses are noted in the company’s reports as “immaterial.” Tesla does not market or pay for endorsements, as Musk tweeted in 2019. Instead, we simply put that money to work improving the products.
But not every business is like Tesla. The majority of big businesses invest a lot of money in digital marketing, which has a big impact on their bottom line. At Twitter, creating a fantastic product and assisting brands in achieving their advertising objectives go hand in hand.
The company’s annual revenues are fueled nearly completely by advertising services:
Early signs indicate that Musk has little regard for the priorities of marketers. In addition to dismissing Twitter’s content moderation staff, he also re-admitted problematic former users and tweeted a right-wing conspiracy theory. He also made a direct appeal to users to vote a certain way in the US midterm elections. Researchers discovered that in the immediate wake of the takeover, there was an “immediate, obvious, and quantitative surge” in hate speech.
How Brands Reacted to Twitter Changes
According to conservative estimates, overall advertising spending on the platform has decreased by 30%. A handful of significant businesses have gone even further and declared that they will stop investing in Twitter.
For instance, in the weeks leading up to its yearly Thanksgiving parade, Macy’s suspended its Twitter promotion. Advertising on Twitter is “high risk,” according to Group M, the largest media buyer in the world, which is cautioning its clients.
90% of Twitter’s revenue comes from advertising, however the majority of advertisers do not use it as a major platform. In other words, Twitter is more dependent on brands than the other way around.
Because it won’t have a substantial impact on their bottom line, this makes it easier for brands to stop their Twitter investment. While we wait to see where Twitter goes next, the budget can be transferred to TikTok or Snapchat.
Despite this, marketers continue to use Twitter as a valuable channel. There are many brand dialogues there, and it might be able to compete with Meta, Google, and Amazon in terms of advertising.
Given that Twitter is now a privately held firm, Mr. Musk’s whims will determine the path of events, and we have no way of knowing what he will do next. It makes sense to create scenarios in advance with this in mind. The following scenarios for brands are the most likely in the future, depending on Musk’s priorities.
Scenario 1: Twitter keeps going in the same direction
In this scenario, Musk follows his recent behaviour through to a semblance of logic. He decides to steal the Band-Aid rather than try to court advertising for their crucial short-term investment. Instead of prioritising advertising in the new Twitter, he wants to create a much superior product that will generate subscription fees. We presume that Musk wants developers to create an open-source platform with little limitations on content release in order to create a “better product.”
This would require acknowledging that, at least during this difficult transitioning period, the needs of advertising are incompatible with Musk’s vision for Twitter. He invested a significant lot of money to purchase the business outright, therefore he could wish to remain unconstrained by marketers.
Instead, Twitter introduces new video features to draw in well-known content producers. It would be logical to start with gaming: Twitter reports that in the first half of 2022, there were 1.5 billion tweets about gaming as opposed to 10.4 billion tweets about news.
What advertising should do in situation one
1 Retain tight control over the dialogue about your brand.
Follow up with customers and keep an eye on brand mentions. You might need to participate more in these interactions to manage your brand image because there are less controls on the platform.
2. Research audience trends
You may need to quickly adjust to their needs if some client groups switch to other platforms. Keep an open mind, though, since additional target groups can find Twitter appealing, which could present a chance to capitalise on your current presence.
3. Compare your options.
Keep a look out for new platforms that will inevitably try to compete with Twitter’s changes.
Scenario 2 : Twitter tries to woo back advertisers
It’s often believed that Elon Musk does not recognise the benefits that advertising provides. His public remarks undoubtedly imply this.
It’s possible, though, that his viewpoint is a little more complex than he makes it seem. Musk stated, “High-relevancy ads are genuinely content, but low-relevancy ads are spam,” in a letter to advertisers in October.
Few would contest the fact that Twitter advertisements are currently the most successful alternative accessible to marketers. Twitter excels in customer service and interaction with users, but it struggles to provide the kind of targeting possibilities that businesses are accustomed to on Google or Instagram.
Musk has a very dim view of the effectiveness of brand-led advertising, but he might have a different opinion about performance-driven, individualised marketing. Twitter would redesign its advertising programme in this situation to produce fresh media forms and performance indicators. This would either users disclosing more personal information or Twitter gathering more useful information from users’ interactions with the site. It would also require reintroducing some form of content moderation in order to regain advertising confidence.
There is a tonne of room for improvement in Twitter advertising, and brands would welcome an alternative to the established heavyweights in performance marketing. For this to happen, Elon Musk will need to drastically modify his mind and create an environment that is safe for businesses. His recent string of U-turns indicate that this is not as implausible as it would appear.
What advertisers should do in case two
Become test-ready.
Check Twitter’s ability to achieve advertising performance and brand safety with modest experiments. In addition to what is provided in the platform’s own dashboard, this may need adding additional tracking to see where your ads are displayed.
Scale back your efforts.
When a large company “all-ins” on a new platform, they stand to lose more. However, seize the chance before others do if a new iteration of Twitter advertising offers your brand an alluring Return on Ad Spend.
Put the new Twitter in perspective.
Examine Twitter’s monitoring and attribution practices. Does the platform make a significant difference in your customers’ purchasing process? How can Twitter be used in conjunction with other advertising platforms to achieve your goals?
Situation 3: Twitter takes a whole different course.
In this case, Twitter turns into a super-app with features like ride-hailing and payments (for Tesla, no doubt). In essence, Musk relaunches the business as a Western equivalent of China’s wildly successful WeChat. WeChat offers thousands of mini-apps and games in China and takes a cut of all platform-related purchases.
As it seeks to get ready for the next social networking era, Meta is going through a similar change. It aims to combine Facebook, Instagram, and WhatsApp into a single platform for brand advertising. Meta is pouring billions into its ambitions for the metaverse as part of this land grab in the future.
Twitter’s path to super-app status would resemble something else entirely. It would try to include the essential elements of our daily digital lives. Typically, that would entail starting with payments, and we must not forget that Twitter’s founder Jack Dorsey currently works for Stripe, a provider of online payment services. If Twitter could master this component, it might inspire programmers to create micro-apps for the service.
Musk is hardly the first tech mogul to recognise the opportunity presented by a “Western WeChat,” either. Finding the chance is different from taking advantage of it. If Musk believes he has nothing to lose and decides to gamble on a high-risk bet rather than pursue advertising, he would probably pick this course of action.
What advertising should do in situation 3
Build a full-funnel approach
If Twitter were able to accomplish this, advertisers would be able to target customers during the entire purchase process. With so many options for mini-apps, users would conduct their research, make comparisons, and make purchases within Twitter’s network. Although it is unlikely that this will happen anytime soon, at least, the same advice holds true for any super-app.
Consider the environment.
A super-app is a network made up of countless little components. The most prosperous businesses forge early alliances and create a presence on the most well-liked mini-apps.
Discover what works throughout the world.
There are other WeChats in other parts of the world, but we do not have one in the West. For instance, Gojek’s platform in Indonesia provides a wide range of services. Examine the strategies that are successful in other nations and gauge how well they will work for your brand.
Key takeaways
Twitter might choose to go in one of these directions, all three of them, or a completely different one. Over the upcoming weeks and months, we’ll all have to watch as the story develops before our very eyes (or, perhaps, days).
The key consideration for brands is whether the advantages of using Twitter outweigh the drawbacks. Due to the fact that their customers are on Twitter, the majority of brands have been compelled to join. Maintaining a presence there with the possible addition of brand awareness advertising or promoted postings was low-risk.
Brands will need to pay a lot more attention to their marketing efforts in the new era of developments at Twitter. Being cautious will pay off in the near term, but businesses cannot ignore the possibility that if Twitter advances to its next stage, it may present both new chances and problems.