The social network X, formerly known as Twitter, announced the launch of a commercial initiative that is designed to stimulate small businesses to place advertising materials about their products and services on this virtual platform.
This week, the company announced its readiness to provide a one-time advertising loan, the amount of which is $250. These funds will be allocated to those firms that will spend at least 1 thousand dollars on the implementation of marketing projects in the digital dimension. At the same time, the social network, in a message about the conditions for obtaining credit funds, clarified that they would be provided to selected companies, without explaining the criterion of that very selectivity.
The company also reported that more than 80% of active users of its virtual platform are representatives of small and medium-sized businesses. The social network has defined the business sphere as a segment of the implementation of its commercial initiative to activate advertising projects.
X reported that advertising credits will be canceled on December 31 of the year when the money was allocated to recipients and that it may be subject to a minimum spend.
A message about a new commercial idea of one of the giants of the social media industry appeared after an interview with the company’s CEO Linda Yaccarino, in which she shared plans for the development of a virtual platform. She reported on the integration of advertising technologies based on artificial intelligence into the digital space X, through the use of which brands can determine a kind of degree of control of materials next to which information about their goods and services is published. The head of the company also said that the firm will offer a discount on the purchase of less conservative advertising spaces.
Linda Yaccarino also spoke about brands that returned to the social network after a temporary absence due to the decision to interrupt commercial interaction with the platform against the background of the chaotic acquisition of the company by Elon Musk last fall. Then many firms decided to curtail commercial projects in this social network or revise their implementation plan. Linda Yaccarino reported that some brands, including Coca-Cola and State Farm, returned to the platform after last year’s refusal to cooperate.
Currently, this social network, in a sense, is forced to create new solutions for interacting with advertisers, since the company’s income from this segment of activity demonstrates the dynamics of decline. In June, the media reported that in the five weeks from April 1 to the first week of May, the so-called advertising profit of the virtual platform amounted to $88 million. This result is 59% less than the same indicator for the same period last year. The media reported this information with reference to the company’s internal documentation. Also, the firm regularly failed to achieve the figures corresponding to the forecasts of weekly sales in the United States, lagging behind the expected financial level by 30%.
Elon Musk reported last month that X has a negative cash flow due to a drop in advertising revenue by about 50% and a large debt. But that didn’t stop Linda Yaccarino from declaring in August that the company was close to breaking even.
Advertising credits are standard practice, but in the case of X, additional efforts are required to promote this commercial solution against the background of the firm’s unfavorable state of affairs in terms of financial efficiency.