Change of logo | Musk’s new Twitter puts companies in trouble

2023-07-26 20:25:41

Twitter has died. After 17 years, Elon Musk buried this Monday the red social of the little blue bird, which has come to be called X. “New logo, new life”, one might think. However, he continues dragging the same problems as before while adding new ones. And many of those embarrass the very companies you need to keep your business afloat. business.

The old Twitter lives on advertising. However, in recent months that source of income it has plummeted up to 50%, as indicated by Musk himself. Aware of this problem, the company is beginning to offer discounts of up to 50% on the precio of those advertising spaces to try to capture advertisers. “The objective of these discounts is to help our advertisers gain reach during crucial moments on Twitter, such as the Women’s World Cup,” read internal emails seen by ‘The Wall Street Journal’.

This drop in income is due to problems in the advertising sector, but also to the decisions of the controversial businessman. In recent months, it has allowed the reincorporation of users of extreme right and it has turned the blue verification pin — previously used to distinguish and identify authorized accounts — into a service that everyone can buy. This has fueled hateful content and facilitated identity theft, a scenario that has scared away many brandswho prefer digital spaces in which promoting themselves is more comfortable and less risky.

Last May, Musk hired the executive Linda Yaccarino to fill the position of CEO of Twitter. Her experience as head of publicity for the media giant NBCUniversal has calmed several brands, who have relied on her role to improve content moderation and make the social network a more attractive space.

payment requirements

However, Musk’s new strategy also puts those companies he intends to retain in trouble. The company would have indicated to these brands that on August 7 they will lose their logo of check gold if they have not spent a minimum of $1,000 on ads in the previous 30 days or $6,000 on ads in the previous 180 days, according to documents published by The Wall Street Journal.

This threat is not trivial. If they don’t comply with Musk’s payment demands, companies could lose control over their image on the social network. The pin they have on their profile allows them to differentiate themselves from fake accounts and thus avoid identity theft. Not having that mark could make it easier for malicious third-parties to impersonate it, opening the door to countless reputational issues that no company wants to deal with.

Platforms like Facebook or Instagram have made this business model a success story, but that of the application that we are dealing with has not been anything to get excited about. Throughout its history, Twitter has racked up years of losses. In 2022, the company generated $4.4 billion in benefits, a drop of 11% compared to the previous year. Of those, 90% came from the ads of the brands that are now against a rock and a hard place. A play that Musk can do well, but also very badly.