Saturday, June 22, 2024

Advertisers have stated they don’t plan to resume spending on X, the social media company formerly known as Twitter, after its owner, Elon Musk, insulted brands and discouraged them from investing in the platform.

Several marketing agencies reported that the brands they represent were standing firm against advertising on X, while others advised advertisers to stop posting anything on the platform. They indicated that temporary spending pauses against X are likely to become permanent freezes due to Mr. Musk’s comments giving them no incentive to return.

Lou Paskalis, the founder and chief executive of AJL Advisory, a marketing consultancy, affirmed that advertisers are “not coming back” to X and there is no advertising value that would make the reputational risk worthwhile.

Mr. Musk has alienated advertisers since purchasing Twitter last year and even threatened a “thermonuclear name & shame” against those who paused their spending due to concerns about his plans to loosen content moderation rules on X.

The situation was compounded when Mr. Musk made incendiary comments against advertisers at the DealBook Summit in New York. While he apologized for an antisemitic post, Mr. Musk accused advertisers of attempting to “blackmail” him and used an expletive to emphasize his point.

Following this, Linda Yaccarino, X’s chief executive, tried to mitigate the damage, shifting attention to Mr. Musk’s apology for associating himself with antisemitism and appealing to advertisers to return.

A representative for X did not respond to a request for comment.

It appears that brands are unlikely to side with X’s views on free speech, and the spending pauses on the platform are likely to turn into a termination of advertising on X unless significant changes occur.

Several marketers are now recommending that brands abandon X entirely due to Mr. Musk’s actions. The rejection of advertisers poses challenges for Ms. Yaccarino, as she tries to stabilize X’s revenue, especially given that the last three months of the year are historically lucrative for the platform.

Among the brands that have halted their campaigns on X are Apple, Disney, and IBM. Mr. Musk acknowledged that an extended advertiser boycott could bankrupt X and stated that he will not pander to advertiser concerns.

Mr. Musk’s dismissiveness of advertiser concerns has caused brands to view him as a risky partner, and it suggests an outrageous amount of uncertainty regarding his platform, how he will partner with advertisers, and whether he even cares about what advertisers think. Businesses are full of people, and people like to be treated well, respected, and dealt with dignity.

Ryan Mac contributed reporting.

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