The latest comments reinforce that Musk isn’t fit to lead a platform that’s a safe place for brands.
Mobbie Nazir, chief strategy officer, We Are Social
Conflating ad buys with endorsing free speech
Musk’s ongoing attempts to position advertisers leaving the platform as an assault on free speech suggest a lack of understanding of his main customer base.
“That’s not part of the advertiser’s calculus,” said Paskalis, pointing to more critical factors like whether placements get good returns, or whether they drive business.
Similarly, sources view X CEO Linda Yaccarino’s post following Musk’s comments as equating existence on the platform as an endorsement of its philosophy on free speech. More important values for brands include “consistency, predictability, audience penetration, risk vs. reward,” said the first exec.
Implying that advertising on a platform endorses its philosophy make it harder for brands to explain why they are still there. “You don’t want to make advertisers have to eat your dog food,” they added.
Musk’s dismissive view of advertisers, which make up more than 90% of X’s revenue, is even more alienating since Twitter was never an essential buy for advertisers. While Twitter was phenomenally successful during sporting events like the Super Bowl, little of that experience can be replicated, sources said. Meanwhile, X itself doesn’t have sufficient inventory to remain meaningful for many advertisers, said Paskalis.
Musk’s comments at DealBook Summit were aimed at an audience of mostly CEOs and CFOs. His intentions for new revenue models for the platform are still nascent—a paid tier has been touted—but these comments aren’t likely to endear him to potential partners.
“The latest comments continue to reinforce the now widely held view that Musk isn’t fit to lead a platform that’s a safe place for brands to be a part of,” Nazir said. “It’s not a big reach to say that if Musk doesn’t get his act together, X could fade into obscurity.”
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