X, the company formerly known as Twitter, has a new initiative aimed at luring smaller businesses to advertise on its platform. The company announced on Wednesday it would offer a one-time ad credit of $250 to select businesses when they spend $1,000 or more on new ad campaigns over the next 30 days.
In its post, X touted that more than eight in ten active X customers were small to medium-sized businesses (SMBs) — the segment of the market where X is directing its new promotion. In a related FAQ, X says the ad credits will expire on Dec. 31 of the year they were issued and may be subject to a minimum spend.
The announcement follows an interview that X CEO Linda Yaccarino recently did with CNBC where she broadly discussed toptechtrends.com/2023/08/10/video-calls-are-coming-to-x-formerly-twitter-ceo-confirms/”>X’s future plans. She told the outlet thattoptechtrends.com/2023/08/10/ceo-says-x-formerly-twitter-is-close-to-break-even/”> X was integrating AI-powered ad tech that lets brands choose how careful they want to be about the kinds of content their ads are placed alongside. The ad slots that are toptechtrends.com/2023/08/09/want-to-pay-less-for-your-x-ads-just-place-them-next-to-spam/”>less conservative would be sold at a discount.
Yaccarino also highlighted advertisers that were returning to X, including Coca-Cola and State Farm, after Elon Musk’s chaotic takeover of the company hadtoptechtrends.com/2022/11/04/musk-blames-activist-groups-for-major-advertisers-pausing-spending-on-twitter/”> led many major advertisers to depart or at least re-evaluate their ad spend.
Despite Yaccarino’s assurances, the reality of the situation is that Twitter/X advertising revenue has been on the decline. According to a June piece by The New York Times, Twitter/X’s U.S. advertising revenue for the five weeks from April 1 to the first week of May was $88 million — a drop of 59% year-over-year, the report said, citing internal documents the outlet had obtained. In addition, Twitter/X had fallen short of U.S. weekly sales projections by as much as 30% on a regular basis, it noted.
Even X owner Musk has talked about the ad revenue decline, posting just last month that X was still seeing negative cash flow due to a roughly 50% drop in ad revenue and heavy debt.
Surprisingly, toptechtrends.com/2023/08/10/ceo-says-x-formerly-twitter-is-close-to-break-even/”>Yaccarino claimed only a month later that X was “pretty close to breaking even,” crediting X’s API, data licensing and subscription businesses as aiding with that, alongside advertising as helping reach that goal.
While ad credits are a common business practice, it’s clear that in X’s case, it’s more in need of a promotion to give brands a little push.
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