• by Wayne Friedman , Staff Writer, July 18, 2023

Imagine if a TV network witnessed a 50% drop in advertising revenue after a change in ownership -- or some other massive disruption. All hands on deck -- or head for the lifeboats?

Elon Musk, who bought the company for $44 billion, confirms the social media platform's ad revenue has dropped a massive 50% -- while cash flow at the company remains in a negative situation. Twitter has been getting about $4.5 billion a year from advertising revenue -- which is 90% business of its overall revenues.

This is where Linda Yaccarino -- former NBCUniversal ad-sales chief -- finds herself at with her new job -- working now from a base of around $2.3 billion.

Any gains that are made now --  improving on those cutbacks -- will be good news. Certainly there are big ad-sales goals -- not just to get Twitter back to where it was, but to improve on things long-term. 

By way of comparison, perhaps the TV upfront marketplace doesn't seem so bad. It is witnessing some rare softness for drastically different reasons.

TV upfront ad revenue is estimated to see around a 5% decline this year.

In any event, Yaccarino's job is now much harder.

And then throw in prospects of the new Meta Platforms' Threads -- a wannabe social-media Twitter competitor. Threads now has some 150 million global users who downloaded the app -- half that of Twitter’s 350 million or so users. 

That said, Threads is only weeks out of the gate. Daily usage of Threads has not been revealed and avertising revenues prospects still have a long way to go.

Near term, Yaccarino's goals include stopping the losses. But it will take a herculean effort.

It is rare that anyone can turn around a 50% hit in advertising revenues in a year or so. 

The question is what the advertising-sales pitch now is to those skeptical brands -- who also buy TV advertising, and who, on the surface, have little reason to reverse their decision to bolt.

Does Yaccarino now pitch linear TV's crumbling reach, and that social media overall still has strong engagement and high return on media investment?

That would be an interesting conversation to listen to. 

We guess that some brands might return the favor -- telling Twitter ad-sales executives their boss had always talked up linear TV as a premium media platform where strong content and engagement was a no-brainer to do business around.