This week Elon Musk suggested that people should pay to earn the blue verified account mark and other premium features (already available through Twitter Blue).
This offer was generally met with a “meh” from the Twitterati, but I think a more interesting debate is why this subscription idea is so important. In fact, the future of Twitter and Elon Musk’s “town hall” vision depends on it.
He knows Twitter is stuck … but this won’t fix it. Let’s explore this today.
Show me the money
Twitter has to make money, and there are basically two options: Ads and subscriptions.
Advertising is by far the most preferred and profitable method, and we can witness the success of Facebook and Google as obvious examples of this.
Why is there no premium subscription version of Facebook? One simple reason. If you offer an ad-free version, there are less people to attract advertisers! The more people, the more data and more ad views. Creating Facebook subscriptions would be a really dumb idea.
But here’s the problem. If you have an ad-based model based on time on site, your best business model is hate. I know that sounds weird, but it’s true. If you want tons of people on your site, just open the doors and let them hate each other. The more wars, the better.
In 2020, the bombastic revelation was made that an internal Facebook executive committee recognized the company’s role in enflaming hate speech and proposed an action plan. Zuckerberg ignored it because he knew hate is good for growing his business.
Facebook has been emphasizing Groups because it pushes hate behind closed doors and makes it safer for advertisers. However, there are no groups on Twitter. There’s no place to hide.
The other revenue option is subscriptions.
When former Twitter exec Ev Williams founded Medium, he decided against the advertising model. He realized that advertising can’t co-exist in a world of quality content because eventually, the content starts to drive ad sales, not delight fans. And that’s a bad thing.
Medium depends on subscriptions, and that’s the only option if the platform is to maintain its focus and investment in quality. No ads. No spam. No hate. No fake news. Diverse perspectives. This is what we need in the world right now.
This is why Twitter is stuck
So here is the summary:
Ad model = Polarization is good because it attracts time on site. However, more money is needed for moderation because brands don’t want to be associated with a toxic platform. If Twitter throws the doors wide open, users and advertisers will stay away (they already have!)
Subscription model = You can let it get as toxic as you want because you don’t need ad dollars, but it also becomes a niche site because many will flee. There is no way Twitter can grow subscriptions fast enough to make it work. They simply must have advertisers.
We now see Musk’s dilemma and why Twitter is stuck.
The solution
For Elon Musk to achieve his vision of “free speech absolutism,” his only choice is to increase paid subscriptions faster than a SpaceX rocket. In fact, he needs everyone to pay something.
The only way to do that is to somehow create insane new value for the subscription price. Twitter already has a premium model called Twitter Blue. In the past year, it has only generated $6.4 million in revenue. Peanuts. It’s not working.
By adding blue check verification to the product offering, Musk is just putting lipstick on a pig.
Here’s what Twitter needs to drive a subscription model: Insanely good, exclusive content.
Why do people subscribe to anything? Content!
I’ve subscribed to a service just to see one show.
In the end, this is his only hope. But the clock is ticking. What is the probability Twitter can rapidly drive this strategy and increase subscriptions? Pretty low. Probably zero. Content is not a core competency of the company. It relies on the content of others.
As I see how this is rolling out, it makes me wonder if Musk really thought this through. Did he make an offer on Twitter to make a statement and then get caught in a situation where he HAD to buy it? Is a blue check mark the best he can do? Is that the plan?
In golf, there is a term called the unplayable lie. This happens when your ball lands in a place where you simply can’t advance the ball. Like a lake.
I think Twitter is an unplayable lie. I don’t know how Musk advances it toward his goal. Twitter is stuck.
Mark Schaefer is the executive director of Schaefer Marketing Solutions. He is the author of some of the world’s bestselling digital marketing books and is an acclaimed keynote speaker, college educator, and business consultant. The Marketing Companion podcast is among the top business podcasts in the world. Contact Mark to have him speak at your company event or conference soon.
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