Marketing agencies say the brands that fled X en masse after a marked increase in hate speech on the platform are not coming back, with one executive going so far as to say he is advising customers to stop even posting on the site.
Since taking over the social media giant in 2022, Elon Musk has railed against the advertisers who paid to appear on the site. threatening to take 'thermonuclear' action against those who halt their spending under pressure from activist groups.
This week, Musk told advertisers leaving X to “Go f**kyourself” during an appearance at The New York Times DealBook summit. This came after Musk apologized for his anti-Semitic messages.
Now the founder of marketing consultancy AJL Advisory, Lou Paskalis, said there is no return for companies like IBM.
“There is no advertising value that could offset the reputational risk of returning to the platform,” he said The times.
According to the Times reports, at least six major marketing agencies say their clients “strongly oppose advertising on X.”
In the wake of Musk's outburst, CEO Linda Yaccarino turned to damage control, posting, “X enables an information independence that is uncomfortable for some people.”
“X stands at a unique and amazing intersection of Free Speech and Main Street – and the X community is powerful and here to welcome you,” she added.
Ebiquity chief strategy officer Ruben Schreurs told the Times that Yaccarino's comments did not “resonate.”
Schreurs added that pausing advertising on X was starting to look more and more like a 'termination'.
Going further, a director, Tom Hespos, of consultancy Abydos Media, said he was advising clients not only not to advertise on X, but also to stop even posting on the platform.
'You cannot in good conscience make a recommendation to a client that he or she will remain a part of [X],' he said.
While another, Steve Boehler of Mercer Island Group, said advertisers might take Musk's inflammatory comments personally.
'This is also personal. Businesses are simply full of people, and people want to be treated well, respected and treated with dignity,” he said.
Insider Intelligence analyst Jasmine Enberg said: “If anyone kills X, it's Elon Musk – not advertisers.”
Elon Musk appeared at the DealBook Summit in New York City on Wednesday
Disney CEO Bob Iger, 72, previously said he would not advertise on X because of Musk's anti-Semitic tweet. Musk responded, “Go fuck yourself, is that clear? Hey Bob, if you're in the audience. That's how I feel, don't advertise'
The South African-born billionaire can be seen in conversation with Andrew Ross Sorkin on Wednesday
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An executive at a major global ad buying company, who declined to be named, said only one major client continued advertising on X.
“(Musk) seems determined to destroy the platform,” the director said.
Both Walt Disney and Warner Bros. Discovery stopped advertising on X earlier this month.
At Wednesday's event, Musk singled out Walt Disney CEO Bob Iger, who spoke earlier at the event and said an association with X “was not a positive for us.”
In a memo to employees Thursday, X CEO Linda Yaccarino said the interview with Musk was “candid and deep” and encouraged staff to watch it. She reiterated that X's mission is to be an open platform without censorship.
“Our principles have no price tag and will never be compromised,” the memo said.
The Tesla chief also acknowledged that a prolonged boycott by advertisers could put X, formerly Twitter, out of business, but suggested the public would blame the brands and not him for a possible collapse.
Musk attempted to clarify his November 15 tweet on November 19
X risks losing not only corporate advertisers but also money from political candidates, a revenue stream that revived after the platform lifted a ban on political ads.
According to AdImpact, which tracks political ads, U.S. political ad spending is expected to reach a record $10.2 billion in 2024 — when the presidential election is held.
Mike Nellis, CEO of Authentic, a digital marketing agency that works with Democratic candidates including US President Joe Biden, said he planned to talk to all his clients about whether to spend on X.
“Telling major advertisers and Bob Iger to go F themselves could be the final nail in the coffin,” Nellis said.
X has come under fire for lax content moderation, especially from advertisers who don't want their ads to appear next to inappropriate content.
Ad spending on .
'We think there is a risk that more companies will stop advertising on X; at least in the short term,” said DA Davidson & Co analyst Tom Forte.
“It's fair to say this makes the company's subscription efforts more important and potentially means it needs more than half of its revenue from subscriptions,” he said.
Monthly active users in the US have also declined by about 19 percent since Musk took over Twitter last year, according to research firm Data.ai.
Apple, IBM, Sony, Disney, Comcast and Paramount together accounted for 7 percent of total U.S. ad spending on X through October of this year, Sensor Tower data showed.
At the dinner hosted by the New York Times after the DealBook Summit on Wednesday, guests including representatives from major brands were “stunned” to witness Musk's expletives against advertisers, said an attendee who declined to be named.
One sentiment seemed to be shared among the brand's representatives during the discussion about