Twitter labelled as ‘high risk’ for those looking to buy ads on the platform

15 Nov 2022

Elon Musk at the SpaceX headquarters on 10 October, 2019. Image: NASA/Aubrey Gemignani (CC BY-NC-ND 2.0)

Major agencies are advising clients against advertising on Twitter after a spate of volatile activity under Elon Musk.

GroupM, a global media investment company that is part of the world’s largest ad agency WPP, has reportedly advised clients that buying ads on Twitter is now a “high-risk” endeavour.

Following a takeover by Elon Musk, Twitter has seen a flurry of discordant activity that has made the platform’s future uncertain in both the short and long term. This has included senior leadership losses, halving its headcount, and confusing changes to its verification system.

According to an advice document seen by multiple media outlets, GroupM warned marketers about advertising on the social media platform because of its volatile nature.

“Based on the news of additional senior management resignations from key posts, high-profile examples of blue check abuse on corporate accounts and the potential inability for Twitter to comply with their federal consent decree, GroupM’s Twitter risk assessment is increased to a high-risk rating for all tactics,” the advice read, according to Digiday.

The ad agency, which works with some of the world’s biggest companies including Google, L’Oréal, Nestle and Unilever, joins other big ad players such as IPG and Omnicom Media Group in recommending that clients pause ads on Twitter.

Irish EU base in question

Following the upheaval at Twitter, a source familiar with the matter has told TechCrunch that the company no longer fulfils key obligations to claim Ireland as its main base in the EU under GDPR.

Twitter met with the Irish data watchdog following reports of some key figures leaving the company last week, including head of trust and safety Yoel Roth, chief information security officer Lea Kissner, chief compliance officer Marianne Fogarty and chief privacy officer Damien Kieran.

Graham Doyle, deputy commissioner of Ireland’s Data Protection Commission (DPC), told Bloomberg that the DPC “wants to establish with Twitter that they are going to be continuing to make decisions from their Irish office”.

But to be able to continue using Ireland as its base under GDPR’s one-stop shop mechanism, Twitter will have to make sure the decisions around processing personal data of EU users takes place in Ireland, Doyle told Bloomberg.

“If they’re not, that will have a knock-on effect on their ability to avail of the main establishment.”

As for Twitter’s “potential inability” to comply with its federal consent decree (dating back to 2011) referred to by GroupM, the risk surrounds the fact that Twitter is laying off substantial employees while also experimenting with new features, raising data privacy concerns in the US.

The US Federal Trade Commission issued an ominous statement in response to Musk’s handling of Twitter last week, saying that “no CEO or company is above the law” and indicating that Twitter may be on the agency’s watchlist with potential for an investigation.

Impersonation and Musk’s not-so-free speech

There’s also a risk to brand reputation for companies looking to buy ads on Twitter. Changes to Twitter’s verification system have already caused a wave of problems, with people paying for verification and using this status to impersonate brands, celebrities and even politicians.

Esther Crawford, head of early-stage products at Twitter, recently tweeted that the new Twitter Blue “does not include ID verification”, but is instead a paid subscription that offers a blue check mark “and access to select features” – which has caused many cases of impersonation.

One of the most notable incidents was when a user last week impersonated pharma giant Eli Lilly and tweeted that insulin is “now free”. The real Eli Lilly account responded on Twitter, apologising for the misleading message and linking to its actual account.

Another person used the new subscription system to pose as a verified Nintendo US Twitter account. This account then posted multiple offensive images and videos.

Meanwhile, changes are also impacting Twitter employees. Despite his stance on free speech, Musk recently fired one of Twitter’s engineers through a tweet after the employee criticised him on the platform.

Eric Frohnhoefer was one of many people who publicly argued with Musk over his tweet apologising for Twitter being slow in many countries. Frohnhoefer, who has spent six years working on Twitter Android, tweeted in response that Musk’s reasoning for the lag was wrong.

While the debate on Twitter was a long one, it ended with Musk being annoyed at Frohnhoefer for bringing up his arguments in public. Soon after, Musk tweeted in reference to Frohnhoefer: “He’s fired.”

10 things you need to know direct to your inbox every weekday. Sign up for the Daily Brief, Silicon Republic’s digest of essential sci-tech news.

Elon Musk at the SpaceX headquarters on 10 October, 2019. Image: NASA/Aubrey Gemignani via Flickr (CC BY-NC-ND 2.0)

Vish Gain is a journalist with Silicon Republic