Elon Musk to require brands to spend $1,000 on Twitter ads monthly or lose gold checkmark.
Elon Musk to require brands to spend $1,000 on Twitter ads monthly or lose gold checkmark.
Twitter’s War to Revive Its Ads Business
Twitter, now rebranded as X, finds itself in troubled waters as its ad business takes a hit. In an attempt to revive its struggling revenue stream, the platform is reportedly making a bold move, threatening to strip brands of their coveted verification checkmarks if they don’t contribute to the cause.
The Verification Checkmark Dilemma
Starting from August 7th, X will remove the gold checkmark verification from brands that have not spent a minimum of $1,000 on ads in the last 30 days, or $6,000 over the past 180 days. The decision was unveiled in an email sent to advertisers and viewed by The Wall Street Journal.
Introduced during the December’s Twitter Blue relaunch, the gold checkmark holds significant value for businesses, signifying a verified account. While Twitter charges businesses $1,000 monthly for the checkmark, exceptions were made for their top 500 ad clients and the 10,000 most-followed accounts belonging to companies, brands, and organizations.
Companies’ Reactions to the Fees
Some companies, like The New York Times, have refused to pay the fee but still retained their checkmarks. On the other hand, Air France lost its verification checkmark after not meeting the ad spending requirements.
Whether the newly mandated $1,000 ad spend is additional to the monthly fee or replaces it remains uncertain. However, these stricter rules are a result of Twitter’s dwindling ad revenue.
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The Fall and the Struggle to Rise
Elon Musk, the owner of X, recently revealed a staggering 50% drop in ad revenue, along with negative cash flow. Upon Musk’s arrival, half of Twitter’s top 100 advertisers reportedly left the platform. In December 2022, Twitter’s revenue fell by 40% compared to the same month the previous year.
Musk’s appointment of Linda Yaccarino as CEO in May demonstrated the company’s determination to rectify its ad slump. Yaccarino, previously the chair of advertising sales and client partnerships at NBCUniversal, brings her expertise to the challenge.
In another effort to rejuvenate ad revenue, X has offered discounted rates to some advertisers, according to the Journal’s report. However, it remains to be seen if these measures will be successful in turning the tide.
Twitter has yet to respond to requests for comment on these developments.
In conclusion, Twitter’s transformation into X reflects the company’s battle to resuscitate its ailing ads business. With stricter requirements for ad spending and the threat of losing verification checkmarks, Twitter hopes to rope in brands to contribute to its recovery. Only time will tell if these measures can help X regain its former glory in the advertising landscape.
