Digital ad spending, while still growing overall, “has slowed precipitously,” according to an analysis last month by the research firm Insider Intelligence.
Twitter seems to be having the worst of it. The company has struggled to retain top-tier advertisers since Musk took over as owner in October amid fears of a proliferation of hate speech and misinformation on the platform. Its 10 biggest advertisers last year spent 55 percent less during Musk’s tenure than the year before, and six of them have spent nothing so far in 2023, according to estimates by research firm Sensor Tower. Twitter has offered additional buy-one-get-one-free deals, discounts and incentives to entice advertisers, media buyers said.
But advertising woes have affected the largest publicly traded social networks as well. Snapchat’s parent company posted its slowest quarterly growth rate last month and projected falling sales for the current quarter. Google’s parent company Alphabet said ad sales on YouTube fell nearly 8 percent in the last quarter.
Last year, Meta, which owns Facebook and Instagram, reported its first drop in quarterly revenue (it fell again last quarter). Ad prices on Facebook and Instagram fell 24 percent in the last quarter of 2022 from a year earlier, according to investment bank Piper Sandler.
Shareholder pressure, fueled by years of big profits, continues to push those companies to generate revenue wherever possible. – even, the experts said, through the sale of low-quality ads.
Corey Richardson, vice president of multicultural advertising agency Fluent360 in Chicago, said he was seeing more ads for things he wasn’t interested in: Hawaiian shirts with “Star Wars” characters on them, a font shaped like hands folded in a prayer position, everything mixed with misinformation about vaccines and the occasional video depicting violence.
“They just take the money that comes to them; beggars don’t get to choose,” Richardson said.
Twitter did not respond to a request for comment. Meta declined to comment. YouTube said it invested “significantly” in the quality of ads and the consumer experience.