What Is Happening With The Twitter Purchase?
Elon Musk is taking over Twitter. Now what?
How will the Twitter/Musk deal impact users? Deplatforming, suspensions and other hot button topics are dominating the discourse – on Twitter of course – and across the news.
How advertisers will be impacted by the Twitter purchase is also creating a lot of buzz in boardrooms around the world.
Will Twitter still be brand safe? Will there be a significant drop off in Twitter usership? How will brands that keep advertising on Twitter be perceived? Will anything change at all, or is it really just new ownership and nothing else?
Here’s what you need to know about the sale of Twitter, including details that will help you decide if you can confidently continue to advertise on the social media platform.
Twitter Said No (Sort-Of) To The Purchase Before They Said Yes
Elon Musk is not considered a neutral buyer of Twitter by most of the public, and Musk’s seemingly sudden interest to buy Twitter wasn’t met enthusiastically at first.
However, the enigmatic Tesla and SpaceX founder and entrepreneur ultimately put together a bid the Twitter board could not refuse. “Elon Musk struck a deal on Monday [April 25th] to buy Twitter for roughly $44 billion, in a victory by the world’s richest man to take over the influential social network frequented by world leaders, celebrities and cultural trendsetters,” reported The New York Times. “Twitter agreed to sell itself to Mr. Musk for $54.20 a share, a 38% premium over the company’s share price this month before he revealed he was the firm’s single largest shareholder.”
The Twitter Purchase Could Mean A Change In Public Status And Revenue Generation At The Social Platform
Musk’s plan to take Twitter private is why there is some concern about the change in tone and tenor of what The New York Times calls a social platform with “an outsized role in shaping narratives around the world,” despite having only 217 million daily users. “Political leaders have used it [Twitter] as a megaphone,” noted The New York Times, “while companies, celebrities and others have employed it for image-making and brand building.”
In addition to taking the company private, Musk said he would like to make Twitter ad-free. But, insiders assert that, given Twitter’s complete reliance on advertising and Musk’s $25.5 billion bill with the banks, removing advertising is unlikely. (According to Time, “In Q4 2021, the company reported advertising revenue of $1.41 billion out of $1.57 billion in total revenue during that quarter.”) So far, Twitter’s subscription model, Twitter Blue, has had little impact.
There are many users saying they will leave Twitter, and many other Twitter uses are cheering for what they believe Musk will bring to the platform, which is often embroiled in debates about free speech. For advertisers, quality engagement on Twitter could get trickier if the platform is no longer seen as a premium destination for discourse. Conversely, over the last several years, other platforms have cropped up trying to replicate Twitter without much to show for it, so alternatives that could pull conversation away from Twitter are limited.
An immediate change to the environment on Twitter may be unlikely, but the perception of change and chatter on the platform could be influential. Advertisers will need to stay alert.
What Should Advertisers Do In Response To The Purchase Of Twitter?
Nothing.
However, as this story evolves, advertisers should expect ongoing speculation about brand safety, evolving audiences and how Twitter competitors might respond. It could be difficult for advertisers to be as tuned-in as necessary to understand all the complexities of the shifting landscape at Twitter.
The Digital Advertising Landscape Is Always Changing – DMS Can Help You Navigate It
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