GroupM, which is owned by the world’s largest ad company WPP, has said Twitter is no longer considered high risk, the Financial Times has reported.
Following the takeover of Twitter by Elon Musk, GroupM declared that the social media platform was “high risk” to brands, but it has now changed its mind with the installation of the new CEO Linda Yaccarino.
The reversal in GroupM’s position is pretty simple to understand. Unlike Musk who can be somewhat erratic on Twitter, Yaccarino comes from a solid background in advertising as she was the former head of advertising at NBCUniversal.
GroupM reportedly removed Twitter’s “high risk” designation on Monday, according to three people familiar with the matter. The move should see more clients resume advertising their brands on the social media platform.
The news should be very good for Twitter because it has been struggling financially and Musk had been trying to find ways to solve this by reducing the headcount and by introducing a premium tier called Twitter Blue.
A person with knowledge of the matter told the Financial Times that GroupM had been holding off on reversing its designation until Musk sorted out his senior leadership team.
The source also said GroupM had been working with Twitter to ensure ads don’t appear with problematic content. GroupM has not spoken publicly on the matter just yet, so things could still change.
Ad revenue, as on many websites, is crucial for the viability of Twitter because most users don’t subscribe to Twitter Blue but still use the website which runs on resources that have to be paid for.
While Twitter will still seek other ways to monetize the company, having the ad revenue coming in will be a boon for it. Linda Yaccarino is expected to take on the CEO role from Musk in the coming weeks.
Source: Financial Times