No I’m not going to be talking about squabbles between your favorite influencers. I want to talk about Twitter seemingly collapsing under the weight of new management and a lack of ad revenue possibly being turned around as a new CEO steps up to the plate.
Twitter may or may not be on the precipice of collapse, but it is in a state of flux. Elon Musk confirmed the new CEO, former head of global advertising and partnerships at NBC, Linda Yaccerino. This could signal a fix for the leaky pipe Twitter has seemed to develop. Depending on Yaccerino’s focus could also be a sign as, Jim Louderbeck suggests, that Twitter will be focusing on more traditional advertising and lifting their attention
from creator partnerships.
What to Expect
Of course none of us can know for sure what Yaccerino’s plans are when she takes control of running Musk’s $44 billion social media platform, but she is certainly qualified to help with this unique set of circumstances. Linda Yaccerino is a veteran of the media industry with over 20 years of experience in advertising and partnerships. She is well known for growing ad revenue for media companies.
We are likely to see some major changes in the ad format. Perhaps Yaccerino will have a plan to make the format more engaging and relevant for users, by using interest and demographic targeting while using strategically placed interactive ads. With advances made in machine learning this is possible on a platform like Twitter. Using these tools and more direct tracking metrics it may become more compelling to traditional advertisers especially with Yaccerino’s connections. It’s also likely she will have to build the sales and marketing departments back up to create and also keep up with the new demand.
These are just a few examples, but specific things will depend on a number of factors including the needs of advertisers, users and the ever changing competitive landscape.
Some twitter users are concerned that because it is likely Twitter’s new Ceo will be focused on the big spending traditional advertisers that there could be a policy change that affects their “freedom of speech”. This is a valid concern considering most traditional advertisers are sensitive to controversial or offensive content and don’t want to be associated with it.
We know that Musk doesn’t want to look like he is flip-flopping on the issue, so it may be that Yaccerino is able to work to find a balance between protecting speech on the platform and still pleasing the traditional advertising community. If she doesn’t find an adequate balance the advertisers will jump ship if they even get on board to begin with. On the other end, users may flee in droves, which will leave either advertisers or Twitter holding the bag.
Twitter’s Path to Profit
Twitter is certainly in a position of despair when it comes to turning around their revenue. The company has been losing money for years and is under increasing pressure from competitors like Facebook, Instagram and Tiktok. In order to get out of the red Twitter will have to accomplish a number of things.
Twitter will need to grow its user base. Twitter’s user base is relatively small compared to its competitors. Facebook for example reported having 2.9 billion monthly active users in January, by comparison Twitter only had 330 million monthly active users. To have hopes of growth Twitter will have to become more attractive to users. This could possibly be accomplished by adding something to make the platform more user friendly or approachable.
They need to increase ad revenue. Twitter’s main source of revenue is advertising and they need to do what it takes to make the platform more attractive and accessible to advertisers. Implementing better tools with better demographic, customer avatar targeting may be a way to get more advertisers on board. Having a smaller user base and worse tools are putting Twitter at a major disadvantage for gaining advertisers, especially with their controversial speech policies.
Thinking outside the box and exploring new revenue streams may be necessary for the platform to stay afloat. They are already experimenting with something like subscription services and they may want to branch out into some form of ecommerce.
Some additional things it could do to improve its revenue and gain more followers is improve its moderation policies. Twitter has been criticized for having lax moderation which allows harmful content to spread across the platform. It could make investments toward new products and services, perhaps a streaming service like Amazon Prime offers. After implementing Twitter Vision it could partner with another business to release a folding tablet that only streams from Twitter. Jokes aside, Twitter has a lot of pressure to turn around their deficit and new CEO Linda Yaccerino has a lot of weight on her back.
The Ghost Of Twitter’s Future
I don’t think that Twitter is going to be going out of business and I don’t think it would be a good thing if they did. Twitter still has a large and somewhat loyal user base with a lot of valuable user data that is useful to advertisers. As long as they continue to innovate and grow their base Twitter will likely become profitable.
They are in a good position to make a turn around as long as they make steps to turnaround the revenue river. Perhaps the engine of change is coming and will propel them up river to the promise land.
Best of luck to Linda Yaccerino,