On Thursday we emphasized in a note titled "Time To Boycott Elon's Boycotters" that when mega-corporations advertise on social media platforms or news websites, it's often less about traditional advertising and more about supporting, promoting, and financially backing specific ideologies and party lines that align with their interests.
As we noted, "It's why when Pfizer or Moderna spend tens of millions for advertising in the NYT, it is not so people are aware that Pfizer makes a covid booster shot - they know that from non-stop news coverage; it is to make sure that the NYT never questions the corporate party line. In other words, it is public relations in an advertising wrapper."
Elon Musk is purging these mega-corporations from advertising on X, intentionally or unintentionally.
His remarks on Wednesday at the DealBook Conference, where he bluntly told the audience that advertisers who attempt to "blackmail him" can "go fuck themselves."
🚨WATCH🚨 - ELON MUSK GOING VIRAL ON NATIONAL TV‼️ “Go Fuck Yourselves” to all advertisers threatening to leave X 🤯🤯🤯 pic.twitter.com/KL7jgCk1Tg— Nelson Epega (@nelsonepega) November 29, 2023
Musk was referring to some of these advertisers: Disney, IBM, and Apple, which halted ad spending on the platform for the billionaire's 'antisemitic post.'
However, what is very interesting is that other social media channels, like Facebook and Instagram, have had way worse content on their feeds, but you don't see corporate media and activist groups trying to pressure advertisers on those platforms.
Out with the old...
To that end, Musk plans to attract small business advertising to plug the holes.
"Small and medium businesses are a very significant engine that we have definitely underplayed for a long time," X told the Financial Times.
X even said, "It [was] always part of the plan — now we will go even further with it."
Perhaps large corporate ad spend was always destined to evaporate. When Musk bought X, he fired 80% of the workforce and dismantled the FBI's communication channels with the platform that suppressed non-approved government stories, such as Covid lab theory and Hunter Biden laptop stories. The "one big club," as it were, does not like this.
X told FT that it has ramped up ties with advertisers, such as JumpCrew, to which it will outsource some ad sales to target small and medium-sized businesses.
A former X senior sales executive said Musk would have to soon make a difficult decision in either keeping an in-house ads team or moving to outsource sales and adopting an automated "self-service small business platform."
Meanwhile, X CEO Linda Yaccarino responded to the controversy:
Linda Yaccarino, X’s chief executive hired by Musk for her deep connections to the advertising world, was bombarded by calls from friends and associates last weekend during her daughter’s wedding, according to several people familiar with the matter. They urged her to quit to protect her reputation.
On Thursday evening, Yaccarino instead sent a company-wide email cheering on X’s stance on fighting “censorship” and stating that Musk had shared an “unmatched and completely unvarnished perspective” and vision for the future. -FT
"Our principles do not have a price tag, nor will they be compromised — ever," wrote Yaccarino. "And no matter how hard they try, we will not be distracted by sideline critics who don’t understand our mission."
X's switch in advertising strategy is necessary to mitigate corporate media and activist groups' 'blackmail" of ad spending for content that they do not like.