I met with Musk in April for the first of many turbulent interviews about his acquisition of X.
He remarked something that, in retrospect, was quite telling, but which I missed at the time.
When it comes to marketing, he said: “If Disney feels comfortable advertising children’s movies [on Twitter], and Apple feels comfortable advertising iPhones, those are good indicators that Twitter is a good place to advertise.”
Seven months later, Disney and Apple have stopped advertising on X, and Musk has told corporations that have left to “Go [expletive] yourself.”
After an examination by a US organization, Media Matters for America, revealed ads appearing next to pro-Nazi posts, the corporations suspended advertising. X vigorously contested the report, calling its research methods into question, and filed a lawsuit against the organization.
Musk invoked the “b” word – bankruptcy – in a furious interview on Wednesday, indicating how much the ad boycott is hurting the company’s bottom line.
Elon Musk visits Israel following an anti-Semitism controversy.
Bankruptcy may seem impossible for a corporation he purchased for $44 billion (£35 billion) last year. However, it is conceivable.
To understand why, consider how dependant X is on advertising revenue – and why sponsors aren’t returning.
Although we don’t have the most recent data, advertising accounted for roughly 90% of X’s revenue last year. It is the company’s beating heart.
Musk more than hinted at this on Wednesday.
“If the company fails… it will fail due to a boycott of advertisers.” And it is what will bankrupt the corporation,” he said.
Elon Musk and columnist Andrew Ross Sorkin speak at the New York Times annual DealBook summit IMAGE SOURCE,GETTY IMAGES
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Elon Musk issued a direct message to advertisers during an on-stage interview in New York.
Mark Gay, chief client officer at Ebiquity, a marketing agency that works with hundreds of clients, says there is no evidence of anyone returning.
“The money has come out and nobody is putting a strategy in place for reinvesting there,” he said.
Walmart said on Friday that it will no longer be advertising on X.
Musk revealed something that made marketers wince even worse after telling advertisers who left X where to go in Wednesday’s interview at the New York Times DealBook Summit.
“Good morning, Bob,” he responded, referring to Disney CEO Bob Iger.
