Elon Musk says Twitter has seen a 'massive drop in revenue' as more brands suspend ads |  CNN Business

Elon Musk says Twitter has seen a ‘massive drop in revenue’ as more brands suspend ads | CNN Business


Elon Musk said Friday that Twitter had seen a “massive decline in revenue” as a growing number of advertisers suspended spending on the platform following its $44 billion acquisition.

“Twitter has seen a massive drop in revenue, due to activist groups pressuring advertisers, although nothing has changed with content moderation and we’ve done everything we can to appease the activists” , he said in a tweet. “Extremely messed up! They are trying to destroy free speech in America.

The remarks come as brands including General Mills and Volkswagen Group suspend advertising on the social network and civil society organizations call on Twitter advertisers to halt all spending globally, citing the uncertainty about the direction of the company under Musk.

“We have suspended advertising on Twitter,” General Mills spokesperson Kelsey Roemhildt told CNN in a statement, making it the first company that does not compete with Musk’s Tesla to confirm such a move. “As always, we will continue to monitor this new direction and evaluate our marketing spend,” the spokesperson said.

In a separate statement, the Volkswagen Group, which owns Audi, Porsche and Bentley, confirmed that it had recommended its brands to “suspend their paid activities on the platform until further notice”.

The Wall Street Journal, which was first to report the moves, also said Pfizer and Mondalez were suspending ads on Twitter. The companies did not immediately respond to a request for comment.

The companies join General Motors, which previously said it would suspend payment for advertising on Twitter while it evaluates the platform’s “new direction.” Toyota, another Tesla competitor, previously told CNN it was “in discussions with key stakeholders and monitoring the situation” on Twitter.

On Friday, organizations including the Anti-Defamation League, Free Press and GLAAD have stepped up their campaign to pressure more brands to rethink advertising on Twitter. The groups pointed to Friday’s massive layoffs of Twitter staff as a key factor in their thinking, citing concerns that Musk’s cuts could render Twitter’s election integrity policies effectively unenforceable, even if they remain technically active.

After months of uncertainty over Musk’s impending acquisition, advertisers are now facing questions about how Musk will change the platform, which is already also streaming into the digital ad space despite its political clout. disproportionate. Musk, known as both an innovative entrepreneur and an erratic figure, has vowed to rethink Twitter’s content moderation policies and reverse permanent bans on controversial figures, including former President Donald Trump.

This creates a challenge for brands, who are sensitive to the types of content their ads run on, an issue made more complicated by social media. Most marketers bristle at the thought of their ads being shown alongside toxic content such as hate speech, pornography or misinformation.

Ad buying giant Interpublic Group, which works with consumer brands such as Unilever and Coca Cola, also earlier this week recommended that its clients suspend advertising on the platform.

Musk said he’s not a fan of advertising and is currently working to increase Twitter’s subscription revenue to boost its bottom line and be less reliant on ad sales, which make up 90% of Twitter’s overall revenue. Twitter. But this change will not happen overnight, if at all. Musk said he plans to launch an $8-a-month subscription plan that will provide users with a verification mark, along with several other benefits, but the plans have faced strong backlash.

In the meantime, Musk is trying to avoid a possible exodus of advertisers. Musk’s team spent Monday “meeting with the marketing and advertising community” in New York, according to Jason Calacanis, a member of Musk’s inner circle.

Musk also met earlier this week with a group of leaders from civil society organizations, including the ADL, Free Press and the NAACP, to address concerns about a rise in hate on the platform. Representatives who attended the meeting told CNN they were encouraged by Musk’s willingness to speak and his initial pledges not to change the company’s content policies until the midterms, but told him. called for further action to protect the platform.

Since meeting Musk, representatives of some of the same organizations have said, Twitter’s new owner has exhibited “erratic” behavior that has “betrayed” the commitments he made privately to the groups.

Shortly before the announcement last week of the completion of his $44 billion Twitter acquisition, Musk penned an open letter attempting to reassure advertisers that he did not want the social network to become a “hellscape free for all”.

“Fundamentally, Twitter aspires to be the world’s most respected advertising platform that builds your brand and grows your business,” he wrote. “Let’s build something extraordinary together.”

– CNN’s Brian Fung, Peter Valdes-Dapena and Jon Passantino contributed to this report.

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