Dusseldorf The VW Group recommends its brands to “pause their paid activities on the platform until further notice”. The reason is that “Twitter is revising its Brand Safety Guidelines”. In addition to the core brand VW and VW commercial vehicles, these are primarily Audi, Porsche, Skoda, Seat and Cupra in the advertising environment under the umbrella of the group.
A lot is changing on Twitter after Elon Musk took over the short message service. The 51-year-old wants to allow more freedom of expression there and allow blocked users again. This worries advertisers: “Customers don’t want conflicts, they don’t want controversies,” said Martin Sorrell, head of advertising agency S4 Capital, in a US television interview.
Musk courts advertisers
Volkswagen’s decision joins a growing number of companies who are stepping away from Twitter – including General Motors, Mondelez and Pfizer. However, this step is also easy for the companies that place ads: Twitter accounts for less than one percent of the global digital advertising budget of a total of 521 billion dollars.
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Conversely, the withdrawal is a major blow to Twitter. The company generated 89 percent of its $5.1 billion in revenue from ads in 2021. Sales have already “slumped massively,” Musk tweeted on Friday afternoon.
He cites “activist groups” pressuring advertisers as the reason, although “content moderation hasn’t changed and we’re doing everything we can to please activists.” Musk further claims in the tweet, and: “It’s pretty crap!”
Musk was still trying to keep customers. “I believe in advertising,” Musk wrote in an open letter to “dear Twitter advertisers” a week ago. Twitter wants to become “the most respected platform in the world”. “Twitter obviously can’t just become a hellscape where everyone can do whatever they want.”
Musk will hardly be able to reduce his dependence on advertising even with a planned subscription service. He implements the idea at his other companies: At Tesla, customers can rent assistance driving systems for up to 200 dollars a month, while the SpaceX subsidiary Starlink also offers satellite internet for 80 euros a month in Germany.
But the idea is likely to be difficult to implement on Twitter, as analysts say. Even if the approximately 424,000 verified users paid eight dollars a month for the blue tick in the future, the annual turnover would be less than $40 million.
Departures of key managers
The advertisers are therefore indispensable for Musk to be able to carry Twitter’s $13 billion in debt. So far, however, advertisers have not been dissuaded from their caution.
They may have been irritated by some departures from Twitter, including some of their most important contacts: Sarah Personette, chief account manager, Leslie Berland, head of marketing, or Jean-Philippe Maheu, vice president of global customer solutions.
Twitter workers tweet about being kicked out
The withdrawal of Volkswagen or General Motors also has a special note. Musk is the boss of the electric car manufacturer Tesla, which faces increasing competition from VW and GM.
>> Read here: This is how Handelsblatt readers look at the Twitter deal
Wolfsburg and Tesla are competing for market leadership in electric cars in Europe, while Musk’s company is clearly ahead worldwide. GM boss Mary Barra has also set the goal of wanting to overtake Tesla with a large number of new electric car models.
The brands from the VW empire, which are managed independently, have not yet positioned themselves clearly. “We are monitoring the situation closely and will decide on the next steps depending on how things develop,” says an Audi spokesman.
More: Subject “Your role on Twitter” – This is how the job clearing at the short message service works