X, previously known as Twitter, has announced the discontinuation of promoted accounts, or 'Follower Objective' ads, within its platform's timeline for attracting new followers. This decision, outlined in an email to advertising clients, is part of X's broader strategy to enhance content formats and experiences. The change has raised significance due to the substantial revenue generated by promoted accounts, contributing over$100 million annually to X's global revenue.

Promoted accounts, a well-established advertising format, appear as text-based posts with a 'Follow' button and have been a staple in X's advertising offerings. However, these ads lack the multimedia versatility, such as video, that X aims to emphasize. Despite the impact on ad revenue, X is shifting its focus towards optimizing user experiences through different content formats.

Why does it matter?

According to insiders, the move indicates X's product-driven evolution rather than a revenue-driven motive. The change was abrupt, with the client team having limited time communicating the shift to advertisers. While follower ads represent a relatively small portion of X's overall ad revenue, their removal occurs when the company faces challenges maintaining ad revenue and profitability.