Twitter Offers Free Ads as It Seeks to Woo Brands Back to Its Platform
Twitter Inc. is offering advertisers a new boost in a bid to lure brands back to the social media platform, which has seen its ad business deteriorate following Elon Musk’s $44 billion takeover.
According to emails reviewed by The Wall Street Journal, the tech company is banking on free ad space by offering to match advertisers’ ad spending up to $250,000. All $500,000 in ads must run by Feb. 28, the email said.
Twitter did not respond to a request for comment.
The incentives are the company’s latest effort to get brands to spend on its platform. Twitter recently offered advertisers $500,000 in free ads as long as they spent at least $500,000.
Ad buyers said the incentive could be used to buy promoted tweets that run during Super Bowl week, a prime selling period for Twitter. Advertisers in recent years have flocked to Twitter during the Super Bowl to build buzz around their big game marketing efforts. The Super Bowl is Twitter’s biggest revenue day of the year, the Journal reported.
Twitter is facing financial pressure to woo the many advertisers who have halted their spending since Mr. Musk bought the company in late October. Advertisers shut down largely because of fears over what they said was Mr. Musk to content moderation and concerns that their ads would end up appearing near controversial content.
Mr Musk said in November that Twitter had suffered “a massive decline in revenue” and was losing $4 million a day.
Many major brands including pharmaceutical company Pfizer Inc., United Airlines Holdings Inc. and automakers General Motors Co. and Volkswagen AG have stopped spending on Twitter. According to an analysis of data by research firm Sensor Tower, more than 75 of Twitter’s top 100 ad spenders before Mr. Musk took over were not spending on the platform as of the week ending Jan. 8.
Convincing advertisers to return to Twitter is critical. Almost 90% of Twitter’s $5.1 billion in 2021 revenue came from advertising.
In order for a brand to qualify for the latest incentive, it must use certain Twitter products, such as its recently released Keyword Avoidance tool, which allows advertisers to create a list of up to 1,000 keywords and avoid showing their ads above or below. tweets containing those words.
Mr. Musk said last month that he expects Twitter to be roughly at the bottom of its cash flow in 2023. He had previously invoked the specter of bankruptcy.
Mr. Musk said Twitter had been on track to post negative cash flows of $3 billion a year before the company cut costs, in part by cutting thousands of jobs. He said the staff was roughly 2,000 people compared to about 8,000 previously.
Write to Suzanne Vranica at Suzann[email protected] and Patience Haggin at [email protected]
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It appeared in the print edition as ‘Twitter Dangles Free Space to Win Back Advertisers’.