December 4, 2023
Advertisers said on Thursday, November 30, that they did not plan to reopen their wallets anytime soon with X, the social media company formerly known as Twitter, after its owner, Elon Musk, insulted brands using an expletive and told them not to spend on the platform, reports The New York Times.
At least half a dozen marketing agencies said the brands they represent were standing firm against advertising on X, while others said they had advised advertisers to stop posting anything on the platform. Some temporary spending pauses that advertisers have enacted in recent weeks against X are likely to turn into permanent freezes, they added—noting that Musk’s comments giving them no incentive to return.
Advertisers are “not coming back” to X, said Lou Paskalis, the founder and chief executive of AJL Advisory, a marketing consultancy. “There is no advertising value that would offset the reputational risk of going back on the platform.”
Musk has repeatedly criticized and alienated advertisers since buying Twitter last year. At one point, he threatened a “thermonuclear name & shame” against advertisers who paused their spending because they were concerned about his plans to loosen content moderation rules on X.
In recent weeks, more than 200 advertisers had halted their spending on X after Musk endorsed an antisemitic conspiracy theory and researchers called attention to instances of ads appearing alongside pro-Nazi posts on the platform. The company, which has made most of its revenue from advertising, is at risk of losing up to $75 million this quarter as brands back away.
The situation was compounded on Wednesday when Musk made incendiary comments against advertisers at the DealBook Summit in New York. In a wide-ranging interview at the event, Musk apologized for the antisemitic post, calling it “one of the most foolish” he had ever published, but also said that advertisers were trying to “blackmail” him. He singled out Bob Iger, Disney’s CEO, who also attended the DealBook Summit.
Hours later, Linda Yaccarino, X’s chief executive, tried to mitigate the damage. In a post on X, she shifted attention to Musk’s apology for associating himself with antisemitism and appealed to advertisers to return.
“X is enabling an information independence that is uncomfortable for some people,” Yaccarino wrote. “X is standing at a unique and amazing intersection of Free Speech and Main Street—and the X community is powerful and here to welcome you.”
A representative for X did not respond to a request for comment.
Among the brands that have been big spenders on X and that have recently halted their campaigns are Apple, Disney, and IBM. Other brands have remained, including the National Football League and The New York Times’ sports site, The Athletic.
At the DealBook event on Wednesday, Musk acknowledged that an extended advertiser boycott could bankrupt X. But the public would blame the failure on brands, he said, not on him.
“I will certainly not pander,” he said.
Research contact: @nytimes