Members-Only Article
At the center of the escalating Twitter bonfire this week is the issue of “brand safety.” Musk and Republican leaders are now complaining that “woke” activists are breaking Twitter and pushing it toward financial collapse with calls for boycotts. That’s not what’s happening. Not even close. Are there various activists groups pushing for advertisers to pause or drop Twitter advertising? Yes. But they’re not the real problem. The issue is “brand safety,” which I thought I would dig into because it has implications far beyond the Twitter train wreck. It’s at the heart of many issues in political media.
First, how do I know anything about this? Why am I an expert? Before TPM moved to a subscription model, brand and influencer advertising were at the heart of our business. Because of that, for upwards of fifteen years I had to deeply immerse myself not only in the advertising business generally but in the niche of advertising in political media. It was a huge part of my work for years and I had to understand it really, really well — because the existence of TPM depended on it.
With Twitter today, it’s not just that advertisers don’t want to have their ads showing up next to Kanye West ranting about how his Jewish doctor wanted to have him eliminated. It goes way beyond that. Advertisers don’t want to be near controversy. Indeed, they don’t even want to be near things that are upsetting or agitating. This is why all political and political news media face an inverse premium in advertising because the content is inherently polarizing. You can show the same ad to the same people the same amount of times and you’ll get more money if the content is fashion or parenthood or entertainment than if it’s politics. It’s a bedrock rule of the world of advertising.
When I first got into advertising, TPM was hot. We had a big audience and it was pretty clear that it was just a matter of agreeing to sell this lucrative ad space. Our audience was educated, fairly well off. We would print money.
I soon realized it was quite a bit more complicated.
It’s not just that advertisers don’t want to be near hate speech or awful things. It goes way beyond that. They want to tell you about their brand when you’re in a good, comfortable, feel-good moment.
Here’s an example. Why do you think that even in his heyday Drudge never had anything more than low-rent, crap ads, t-shirt and supplement advertising and the like? A small bit of this is that his expenses were close to nil and his audience was so massive that just running a few low budget ads brought in good money. But the big, big reason is that even though it was a hugely, hugely popular site, premium advertisers simply don’t want to be near something that hot and contentious. Half the people are hate-reading anyway. And those who aren’t are still in an agitated state. There’s always a big inverse premium for yuck and discomfort and controversy. That’s just how the ad business works.
This aspect of the advertising business is actually a big, big reason for what we sometimes call “bothsides” journalism. This is often presented as an outmoded style of journalism. It’s really more a business model. In a politically polarized society advertisers are very, very cautious about giving any hint that they are taking sides in the great political or political factional controversies of the day. They want to put their ads in venues that are above any hint of partisanship or sense they’re taking sides. It’s not that these places get no advertising. But they’re charged a big inverse premium.
Do you ever wonder why the most new and high-powered political news operations — Politico, Axios, Punchbowl, etc. — tend to be inflected toward the mores and concerns of political insiders, especially in Washington, DC? Because that’s where the money is. I mentioned above all the reasons why political news pays an inverse premium in the world of advertising. There’s one big, big exception: Major corporations and brand advertisers have a huge need to make their case and solidify their reputation with the range of stakeholders who run — directly and indirectly — the federal government. There are fortunes to be made in that specific niche, which is the reason those publications exist. In a sense this niche of the larger advertising world operates as a subset of the money advertisers budget to lobbying or government relations.
In more conventional advertising, the exceptions to the fear of controversy are websites that offer something advertisers feel they cannot do without. Even with all its post-2016 controversy, that’s what made Facebook a cash cow. Its targeting was so good, especially for transactional advertising, that the costs were insanely low. Advertisers felt they simply could not not be there. All the dreck on Facebook and controversy around it was just something advertisers had to deal with. The power of the Facebook ad ecosystem was especially strong with transactional advertising, ROI advertising — something that works differently than brand advertising, which is where the big money is. For various reasons Twitter was always a marginal ad buy. It never had those must-have qualities that Facebook did. That’s why Facebook became one of the most profitable companies in the world and Twitter just eked by as a breakeven business.
Musk bought Twitter basically on a lark. He chose his offer price based on a well-known marijuana meme. He had recently become the richest man in the world by a significant margin and thought — not unreasonably — that he could buy Twitter with what is often called “F*&$ You” money. He quickly realized he’d gotten in over his head. But by then it was too late. He’d signed an agreement which proved far more binding than he’d likely realized. Musk’s interest in buying Twitter was driven by his increasingly public identification with right-leaning “Free Speech” politics. Since his Twitter adventure started he’s operated on the premise that he could both be Mr. Free Speech ™ memelord and make Twitter operate at a profit. But that was always absurd. You can do one or the other. Not both.
No advertiser wants to be near this drama or controversy, let alone the next N-word explosion. In recent days, Musk has gone on the platform and gotten in fights over whether or not the company is still committed to “content moderation” and “brand safety.” Somehow he’s shocked or angry that people got the idea that he is doing what he spent the last eight months promising to do. Needless to say, any advertiser is spooked by a platform that is firing half its staff on two days notice. (The real “product” of any social media network is its moderation.) But set all that aside. Musk is unable to grasp that the fighting and impulsive outbursts themselves make Twitter radioactive for most advertisers. Yesterday he began threatening that if major American brands didn’t cut it out he’d do a “thermonuclear name & shame” against them. Needless to say, no advertiser wants to get anywhere near a platform or publication where the CEO might publicly go apeshit on your brand out of the blue because of some adjustment you made in your ad spend. This is completely terrifying to any advertiser. Indeed, even “terrifying” doesn’t quite capture it. They don’t need to be terrified. There are plenty of places to advertise. Would you rather go to the supermarket where it’s calm and friendly or the one where the manager might come out and bawl you out for no apparent reason in front of your family?
None of this is activists’ fault. If you want to run a five star restaurant you can’t put an open air outhouse in the middle of the dining area. That’s just not how it works. Maybe that’s your thing. But it’s not how fine dining works. You don’t get to blame people who say it’s smelly or the much greater number who won’t go in the front door. That’s basically what Musk is doing. He wants to be the world’s biggest troll, play to his new far-right/Trumpy fan base and have all the high dollar national brand advertisers flock to the platform he just wildly overpaid for. That was always an absurd proposition.
