X is facing bankruptcy: advertisers do not plan to return to the social network because of the scandalous Musk
A number of advertisers have said that they do not plan to return to social network X (formerly Twitter) in the near future after comments by its owner Elon Musk recommending that they “go to hell.”
This was reported by The New York Times.
At least half a dozen marketing agencies representing brands are strongly opposed to the return of advertising to the platform. Others advise clients to stop publishing on X.
They added that the temporary refusal to spend on social media could become permanent. Moreover, Musk’s comments do not encourage companies to return.
“There’s no advertising value that can compensate for the reputational risk of returning to the platform,” said Lou Pascalis, founder and CEO of AJL Advisory, a marketing consulting firm.
Elon Musk has repeatedly criticized advertisers of X
Since buying Twitter last year, Musk has repeatedly criticized and alienated advertisers. In particular, he threatened to “shame” brands for suspending their budgets on the social network due to the weakening of moderation.
In recent weeks, more than 200 advertisers have suspended their cooperation due to Musk’s support for anti-Semitic conspiracy theories and the discovery of cases of advertising next to pro-Nazi content.
The company, for which advertising was the main source of revenue, may lose up to $75 million in the current quarter alone.
The situation escalated after the billionaire’s comments at the DealBook summit in New York. Despite apologizing for anti-Semitism, Musk told advertisers to “ go fuck themselves” and accused them of “financial blackmail.”
“Don’t advertise yourself,” he said, using a swear word several times to emphasize his point.
Director X tried to justify Musk
A few hours later, X director Linda Yakkarino tried to mitigate the situation. In the post, she called on brands to come back, shifting attention to Musk’s apology.
Marketing expert Ruben Schreurs believes that Yakkarino was trying to force advertisers to support X’s position on freedom of speech. However, without a change in the company’s management, they are unlikely to consider a return, he believes.
Some experts recommend not advertising on X at all. Media planner Tom Hespos said that for the first time in his career, he advised one of his clients not only to stop advertising, but also to abandon any activity on the social network.
“You can’t in good conscience advise customers to stay on the platform after what Mr. Musk has done there,” Tom Hespos.
Lack of advertising can lead to bankruptcy X
At DealBook, Musk admitted that a prolonged advertiser boycott could force X to declare bankruptcy. However, in his opinion, the public will blame the brands for the failure.
I definitely won’t pander,” Elon Musk.
According to expert Steve Boler, Musk’s disrespectful attitude to advertisers’ problems has made him a risky partner in the eyes of business.
“Mr. Musk’s comments reveal an outrageous amount of uncertainty about his platform and his relationship with advertisers,” Steve Behler.
