Marketing agencies say that the brands who fled X en masse following an apparent rise in hate speech on the platform are not coming back with one executive going so far as to say he's advising clients to cease even posting on the site.
Since his takeover of the social media giant in 2022, Elon Musk has railed against the advertisers who paid to appear on the site, once threatening to go 'thermonuclear' against those who paused spending because of pressure from activist groups.
Then this week, Musk told advertisers who left X: 'Go f**k yourself' during an appearance at The New York Times DealBook summit. That came after Musk apologized for endorsing an anti-Semitic post.
Now, the founder of marketing consultancy firm AJL Advisory, Lou Paskalis, said there is no coming back for companies such as IBM.
'There is no advertising value that would offset the reputational risk of going back on the platform,' he told The Times.
According to the Times reports, at least six major marketing agencies say that its clients are 'standing firm against advertising on X.'
In the wake of Musk's outburst, CEO Linda Yaccarino went into damage control mode posting: 'X is enabling an information independence that is uncomfortable for some people.'
'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,' she added.
Chief strategy officer for Ebiquity Ruben Schreurs told the Times that Yaccarino comments don't 'resonate.'
Schreurs added that the pausing of advertising on X was starting to look more and more like a 'termination.'
Going a step further, one executive, Tom Hespos, of consultancy business Abydos Media, said that not only was he advising clients not to advertise on X but also to cease even posting on the platform.
'You can't with a good conscience make a recommendation to a client that they continue to be a part of [X],' he said.
While another, Steve Boehler of Mercer Island Group, said that advertisers could take Musk's incendiary remarks personally.
'This is also personal. Businesses are simply full of people, and people like to be treated well, respected and dealt with with dignity,' he said.
Insider Intelligence analyst Jasmine Enberg said: 'If anyone is killing X, it's Elon Musk - not advertisers.'
Elon Musk on Wednesday appeared at the DealBook Summit in New York City
Bob Iger, 72, the CEO of Disney, earlier said he would not advertise on X, due to Musk's anti-Semitic tweet. Musk replied: 'Go f*** 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 is seen on Wednesday in conversation with Andrew Ross Sorkin
'Should X collapse, an autopsy would reveal a series of platform policy decisions, staffing cuts, tweets and antagonistic comments by Musk that have driven away X's primary source of revenue,' Enberg said.
An executive at a major global ad-buying firm, who declined to be named, said only one major client was continuing to advertise on X.
'(Musk) seems to be hell bent on destroying the platform,' the executive said.
Both Walt Disney and Warner Bros. Discovery suspended 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 'was not a positive one for us.'
In a memo to employees on Thursday, X Chief Executive Linda Yaccarino said Musk's interview was 'candid and profound,' and encouraged staff to watch it. She reiterated that X's mission is to be an open platform without censorship.
'Our principles do not have a price tag, nor will they be compromised - ever,' the memo said.
The Tesla chief also acknowledged that an extended boycott by advertisers could bankrupt X, formerly Twitter, but suggested that the public would blame the brands and not him for a potential collapse.
Musk on November 19 attempted to clarify his November 15 tweet
X risks not only losing corporate advertisers, but also money from political candidates, a revenue stream that reopened after the platform lifted a ban on political ads.
US political ad spending in 2024 - when a presidential election will be held - is expected to reach a record $10.2 billion, according to AdImpact, which tracks political ads.
Mike Nellis, CEO of Authentic, a digital marketing agency that works with Democratic candidates including U.S. President Joe Biden, said he planned to speak with all his clients about whether or not to spend on X.
'Telling major advertisers and Bob Iger to go F themselves might be the final nail in the coffin,' Nellis said.
X has come under fire for lax content moderation, especially from advertisers who do not want their ads appearing next to inappropriate content.
Ad spending on X in the United States from January through October this year declined 64 percent, compared with the same period in 2022, according to data from media analytics firm Guideline, which tracks advertising spending data from major ad agencies.
'We believe there is a risk that more companies will stop advertising on X; at least on a short-term basis,' D.A. Davidson & Co analyst Tom Forte said.
'It is fair to say this makes the company's subscription efforts more important and potentially means it may need more than half its revenue to come from subscriptions,' he said.
U.S. monthly active users also declined by about 19 percent since Musk acquired Twitter last year, according to research firm Data.ai.
Apple, IBM, Sony, Disney, Comcast and Paramount collectively accounted for 7 percent of total U. ad spend on X through October this year, Sensor Tower data showed.
At the dinner hosted by the New York Times following the DealBook Summit on Wednesday, guests that included representatives of major brands were 'aghast' at witnessing Musk's expletives against advertisers, said one attendee who declined to be named.
One sentiment seemed to be shared among brand representatives in discussing X: 'It's obvious (Musk) doesn't want us there and we don't want to be there,' the attendee said.
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