Major advertisers are withholding ad dollars from Elon Musk's X, formerly known as Twitter, two weeks after he endorsed an antisemitic tweet and launched an expletive tirade on the platform’s advertisers on Wednesday.
As marketing agencies are also withdrawing from the company, X plans to attract smaller and medium-sized businesses to boost its income.
“Small and medium businesses are a very significant engine that we have definitely underplayed for a long time,” a statement given by the company to the Financial Times (FT) on Friday reads. “It [was] always part of the plan – now we will go even further with it.”
Several renowned brands, last month, stopped spending on X following Musk’s endorsement of a post.
At the DealBook event, organised by the New York Times, Musk told the boycotters to “go f***” themselves", accusing them of "blackmail" by withholding advertising to pressure him into greater content moderation, The Guardian reported.
He vowed not to “pander” to big advertisers and warned them of being held responsible for X's collapse.
X was at risk of losing up to $75 million this quarter, with an estimated fall in ad revenue between $10 and $12 million, The New York Times reported last week citing leaked documents.
Half a dozen marketing agencies declined to return to X.
Steve Boehler, the founder of the marketing management consultancy Mercer Island Group, told the Times that Musk’s comments “suggest an outrageous amount of uncertainty regarding his platform, how he will partner with advertisers and whether he even cares about what advertisers think”.
“This is also personal,” Boehler added. “Businesses are simply full of people, and people like to be treated well, respected and dealt with with dignity.”
However, the billionaire hedge fund manager and founder of Pershing Square Capital Management, Bill Ackman,supported Musk.
Ackman, who in October threatened to blacklist Harvard students who had signed a letter blaming solely Israel for the attack by Hamas, said on Friday that Musk’s interview at the event was “one of the great interviews ever”.
“Musk is a free speech absolutist which I respect. I think he is entirely correct that he and X are treated unfairly and inconsistently by advertisers,” Ackman wrote on X.
He said that other platforms, including TikTok, Instagram and Facebook, also contained “enormous amounts of problematic content, antisemitic and otherwise, but the advertisers don’t boycott those platforms”.