Scott Galloway, the self-made millionaire who predicted Amazon would buy Whole Foods, argues in his third book that Twitter should develop a subscription model.
“After months of public lobbying on this front by a brave (and handsome!) NYU Stern professor of marketing, Twitter finally announced in July 2020 that it would ‘explore’ a subscription model,” Galloway writes in Post Corona: From Crisis to Opportunity, which came out Nov. 24.
“The market loved it. Despite Twitter’s admission, in the very same earnings call, that ad revenues had dropped 23%, the stock was up 10%.”
He argues that mega-influencer Kylie Jenner, whom brands pay $430,000 per tweet, should pay $10,000 a month for her Twitter account; Kara Swisher, his Pivot podcast co-host, should pay $250 a month. Verified accounts with fewer than 2,000 followers would remain free.
“The B2B market alone would be huge, as Twitter has replaced PR, news agencies, and IR firms,” he writes. “What firm wouldn’t pay $2,000 a month to announce their new SaaS/diet/keto/hemp product?”
With reactions ranging from “ridiculous” to unlikely that companies would accept such an “astronomical” increase in their social media budgets, marketers are reacting with as much passion as Galloway himself has dished.
Six advertising and social media experts have weighed in for Velocitize’s exclusive analysis of Galloway’s ideas, which have prompted extensive reflection of Twitter’s purpose and future. Several of the people interviewed also object to his claim that Twitter has replaced the public relations and investor relations industries.
Of the idea that individuals with more than 2,000 followers would also have to pay for a Twitter account, Knauff says the number seems arbitrary and difficult to enforce. Twitter users might start blocking followers to stay below the cap. Then there’s the issue of Twitter bots; it’s hard to know if some followers are even people. This past spring, NPR reported 45% of the accounts tweeting about Covid-19 were behaving more like robots than humans.
Galloway’s dismissal of public relations and investor relations professionals is also unacceptable, Knauff says. “That statement is utterly ridiculous. To say that Twitter has replaced those things is stupid. Look at most business accounts. It’s just a stream of articles. It’s not something substantive for many businesses, which is why they don’t get the results they want.”
Olivia Dreizen Howell, CEO of March Lion Media, on Long Island, N.Y., echoes those concerns. Galloway, she says, is “completely devaluing all those industries.”
Subscribe or Unsubscribe?
Likewise, neither businesses nor individuals will take kindly to the subscription model, she says.
“Twitter has been this free place where people can speak their mind—like this old-fashioned village hall—and stand on a soap box,” she says. “If people felt they had to spend money, they might not want to use the platform at all.”
For example, one of her clients is a global food company with products in Kroger and other major retail chains. Its annual social media budget is $30,000, which covers Howell’s strategic advisory services, targeted social media marketing, and daily creation and posting of organic content, across multiple channels.
A subscription model could effectively cripple even a big brand’s budget overnight. “There’s no way,” she says.
Then there’s the issue of what brands and people are getting from Twitter for free, and what they’d demand of a paid option.
Free for All
David Berkowitz, CEO of New York-based Serial Marketer, considers Galloway “one of the most brilliant people out there” and refers to himself as “almost a fanboy.” Still, he can’t accept the idea of a subscription model for both financial and moral reasons.
“When his email comes in, I read every word. I make sure I’m somewhere where I can focus. I do everything but buy his books,” he says. “If you made business predictions based on what Professor Galloway’s predicting, you’d do very well—like Amazon buying Whole Foods. He spelled out the whole transaction. As someone who loves his work so much and respects him so much, I think there are so many caveats you need to build into [the Twitter subscription model].”
Firstly, there may be people with significant Twitter followings who haven’t sold companies for millions of dollars and don’t want to or can’t pay for a Twitter account, Berkowitz says. Although an increasingly toxic place, Twitter does produce a beautiful serendipity because it is free.
Berkowitz says he wouldn’t have direct access to people such as Charlotte Clymer, the transgender veteran with nearly 350,000 followers; Amanda Goetz, the divorced mother of three children with 28,900 followers; Pete Buttigieg, the former presidential candidate with nearly 3 million followers; or, for that matter, his husband, Chasten, a teacher with 500,000 followers and a new memoir.
“My network is disproportionately white and middle-aged and disproportionately New York,” Berkowitz says. But on Twitter, “there are all those voices out there. How do you [start charging] without sacrificing all that?”
From a financial standpoint, Berkowitz says he couldn’t even justify $200 a month for Twitter.
On a monthly basis, he pays less than that for vital business services: Mailchimp to publish his newsletter, Calendly to schedule appointments, Zapier to automate tasks, Dropbox to store and share files, and Trello to manage team projects. In addition, he runs a virtual lounge for nearly 1,800 marketers on Slack, for free. He also pays for a premium membership on LinkedIn, which, unlike Twitter, shows users who have viewed their profile, while providing an ample set of professional tools.
“What are you going to do for me that is better than all of those services combined?” he says.
“Galloway hates Dorsey—there is no love there,” Rick says. “Galloway is not wrong in that Twitter under Dorsey is contemplative. It’s paralysis by analysis and no doubt, as politicians say, they’re studying the issue. Still, I don’t think it’s as black and white as Galloway makes it seem.”
Rick says he himself would pay to use Twitter if it added new features, and would recommend to clients that they do as well. He also believes that major influencers and brands would have “absolutely no problem” paying.
But he thinks a subscription model might raise antitrust concerns. “Every regulator in the U.S. and Europe is scrutinizing Google and Facebook. Their technical defense is, ‘We give the product for free. How can the consumer be harmed?’”
Like Knauff and Howell, Rick says the “hyperbolic” Galloway is dismissing the communications industries. Indeed, publicly traded companies, and the investor relations professionals they employ, must follow strict SEC guidelines when reporting earnings, he says, noting that companies can actually get into big trouble when relying on Twitter too much. The SEC fined Tesla CEO Elon Musk $20 million for a tweet misleading investors that he’d be taking the company private.
Twitter Wish List: What Marketers Would Want if They Had to Pay a Subscription
- Access to Twitter account managers and technical support people who will answer the phone
- Robust analytics reports and actionable insights for improving ad campaigns
- Intel on who has viewed your profile and how active your followers are
- Ability to schedule tweets directly on the platform, instead of having to use Buffer or Hootsuite, and also the ability to edit published tweets
- Image curation; for example, Buffer lets users choose which image to feature when posting a website page or article with multiple images
If a brand were to pay Twitter a subscription fee, and receive a much-needed service upgrade in return, then it would likely become a better community member and post better organic content, in addition to taking advertising more seriously, says Graham Spector, senior manager of content planning at Chicago-based creative agency Social Deviant. But, he says, $2,000 a month is “astronomical to expect.”
Trying to squeeze money out of marketers is not the long-term solution— and not even the right question.
Bloomberg is reporting that Only Fans, which launched in 2016 as a site for adult models, is a “billion-dollar media giant hiding in plain sight.”
From mainstream celebrities such as Cardi B to photographers, musicians, comedians, and gamers, the Only Fans site is catching on with a wide user base willing to pay to see unique content. Subscriptions range from $4.99 to $49.99, far less expensive than Galloway’s model for Twitter.
“It is still an adult-based website, but it’s the model that I think could be very pertinent to this discussion, which is, if you’ve got something to share, you bring in the most avid followers,” Spector says.
The Future of Twitter
Whatever your opinion on Galloway’s positions, there is no doubt he has unleashed an industry-wide debate on social media and influence.
Twitter’s future role is dubious, according to another author famous in advertising circles.
“Whether or not Twitter pivots to a subscription model as Galloway suggests is really immaterial to the general public. For better or worse, Twitter has positioned itself as the political disruption tool,” says Patrick Hanlon, CEO of San Francisco-based consultancy Thinktopia and author of Primal Branding: Create Belief Systems that Attract Communities, required reading at YouTube.
Hanlon adds: “Peering into a post-pandemic world, people are going to lean toward positivism and encouragement. They are already seeking beautiful new forms of capitalism that are clean, sustainable and enriching. Think of the new mindset as economic and political wellness.
“It’s anyone’s guess how (or if) Twitter fits into that world.”