As Elon Musk's power grows, top US companies resume advertising on X

Comcast, IBM, Disney, Warner Bros, Discovery, and Lionsgate Entertainment have returned to advertising on X (formerly Twitter) after a year-long boycott, reports AdWeek. These companies, which previously distanced themselves from the platform over concerns about content moderation, are now cautiously resuming campaigns.

Despite their return, the financial commitment from these brands has drastically reduced. From January to September 2024, these companies spent a combined $3.3 million on X, marking a steep 98% drop compared to the $170 million spent during the same period in 2023.

`Antisemitic content' reason for boycott

The boycott began in November 2023 when ads from these companies appeared next to alleged antisemitic content and hate speech. The situation worsened after X owner Elon Musk allegedly endorsed an antisemitic conspiracy theory. This prompted a coalition of 163 Jewish leaders, activists, and academics to urge companies like Disney, Apple, and Amazon to halt their advertising on the platform.

While traditional advertisers have scaled back, MediaRadar notes that challenger brands such as Karma Shopping, Canles, and Kueez have invested over $68 million on X this year. These smaller brands are taking advantage of reduced competition on the platform, signaling a shift toward a long-tail advertising model that may redefine X’s strategy.

Meghan Fraze of MediaRadar told AdWeek: “This suggests that X might move to a long-tail advertiser strategy. This would benefit new brands looking to connect with audiences without the intense competition.”

The return of major advertisers has been credited to X CEO Linda Yaccarino, whose leadership has focused on rebuilding trust and partnerships. Elon Musk expressed gratitude, saying: “Just want to say that we super appreciate major brands resuming advertising on our platform!”

While IBM stated its approach to X remains unchanged, Comcast, Disney, Lionsgate, and Warner Bros Discovery have yet to comment on their return, AdWeek stated.

As the 2024 US election ended, brands may need to recalibrate their cautious strategies on X, particularly given Elon Musk’s close ties to President-elect Donald Trump. The political climate could influence the platform’s ad landscape and how advertisers approach content moderation and messaging.

This development underscores the evolving dynamics of advertising on X, with traditional brands treading carefully while new players capitalise on a less crowded field.

(By arrangement with livemint.com)