Back to top

Image: Bigstock

Twitter (TWTR) Rolls Out Political Ads Policy Ahead of Ban

Read MoreHide Full Article

Twitter TWTR recently unveiled the first iteration of its new policies surrounding political advertisements on the company’s platform through recent tweets by the company’s CEO Jack Dorsey.

The company intends to prevent advertisers from targeting their messages based on political bias or interests of users such as conservative, liberal or political elections. There will be restrictions on “micro-targeting”, an important tool advertisers use in a bid to reach their target audience.

Twitter’s restriction on targeted ads will prevent advertisers from sending political messages to residents of specific ZIP codes or cities. However, they can broadcast their content at the state level.

Twitter’s Political Content Policy

The company has also rolled out guidelines restricting political content on its platform ahead of the 2020 U.S. Presidential Elections.

Twitter announced that ads related to elections, candidates, parties and other political content shall be prohibited. The ads also cannot mention specific legislations.

Moreover, ads containing political content, such as voting or fundraising appeals, and the ones advocating for and against political content, have been barred.

Candidates, political parties, and elected or appointed government officials will not be allowed to run ads of any kind, which will be applicable for PACs, super PACs, as well as 501(c)(4)s in the United States.

Twitter, Inc. Price and Consensus

Twitter has also added the criteria for advertisements promoted by news publishers. Per the company policy, news publishers, who have already been exempted from its issue ads policy, may advertise based on fact-based reporting, but cannot buy ads advocating for or against a political candidate or any other banned topic. Publishers are exempted from posting a political endorsement as an ad.

Nevertheless, ads with messages on issues such as civil engagement, economy, environment, and social equity will be allowed. However, these shall be prohibited from advocating for or against a specific political, judicial, legislative, or regulatory outcome related to those matters.

Notably, ads that refer to causes generally, and are placed by organizations and not politicians or political candidates would be placed with restrictions, but not be banned entirely.

As a result, non-profit organisations and lobbyists currently lack clarity if their messages would be considered political and if they will be able to run issue-based ads on Twitter.

Per The New York Times report, The Alzheimer’s Association, a health care advocacy group, recently spent $84,000 on ad campaigns on Twitter, in a bid to persuade its users to ask Congress for larger investments in medical research for the disease.

The political ads ban on Twitter’s social platform is most likely to be effective Nov 22 globally.

How Will the Latest Policy Impact Other Social Media Players?

Digital advertising plays a key role in political communication in an era of multiple media choice and fragmented public attention. Interestingly, Tech platforms have largely slashed the costs of running political advertising.

Twitter, thus, serves as a test case for bigger players that have come under scrutiny over their political advertising policies, including Facebook FB, Alphabet’s (GOOGL - Free Report) Google and Snap SNAP.

Per a recent Kantar report on political advertising, U.S. federal campaigns will likely spend spend about $6 billion on advertising, with 20% of the total going toward digital advertising for the next Presidential Elections.

As of Jun 24, President Trump spent close to $17 million on Facebook advertising, followed by Bernie Sanders spending $6.2 million.

Twitter’s initial announcement of its political ads ban comes hot on the heels of the public outcry over Facebook’s recent policy. Per the social media giant’s latest policy, the company will not fact check political statements or remove politicians’ posts, which, it believes to be newsworthy, irrespective of the fact that the content might violate its “community standards.”

Per a Tech Crunch report, Facebook earned $66 billion through political ads in the 12-months period ending third-quarter 2019. The company is projected to earn $330-$400 million next year.

Notably, Google and its video-streaming service, YouTube, have guidelines which prohibit misrepresentation in ads, such as misinformation about public voting procedures or incorrect claims.

However, Snap allows political advertising unless the ads are misleading, deceptive or violate the terms of service on Snapchat. The company defines political ads as including election-related, advocacy and issue ads.

Zacks Rank

Currently, Twitter carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

7 Best Stocks for the Next 30 Days

Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers “Most Likely for Early Price Pops.”

Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.5% per year. So be sure to give these hand-picked 7 your immediate attention.

See them now >>

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Alphabet Inc. (GOOGL) - free report >>