Twitter, the social media giant, is facing financial difficulties and is looking for ways to bring in new revenue. One of the major deficits comes from the withdrawal of a significant number of advertisers following the takeover by Elon Musk. In an effort to bring these advertisers back, Twitter is reportedly offering them free advertising space on the site, with the value correlated to their investments, up to a limit of $250,000.
According to a Wall Street Journal report, this new policy is set to begin on February 28th. The move is aimed at compensating for the loss of major brands, as data analysis by Sensor Tower shows that as of January 8th, more than 75% of the network’s 100 biggest advertisers before Musk’s takeover have stopped their marketing expenditures on Twitter. Advertising has been the biggest source of revenue for Twitter, accounting for 90% of the $5.1 billion earned in 2021.
Twitter’s financial struggles have led the company to explore other avenues for revenue, such as the Twitter Blue subscription and the potential sale of user names. The social network is also hoping to increase its income with the return of political advertising to the network, especially with the 2024 American presidential election in sight.
Twitter’s new ad incentive is an attractive offer for brands looking to advertise on the platform. The free advertising space is a great way to offset the cost of advertising and maximize the reach of a brand’s message. However, this move also highlights the financial challenges that Twitter is facing, as advertising is by far its biggest source of revenue.