Australian advertisers are staying away from Elon Musk’s X in droves

Australian advertisers have been dropping off Elon Musk’s X at a rapid clip – and that was before his endorsement of anti-Semitic comments.

Australian advertisers have all but deserted social media platform X since it was bought by Elon Musk, with new figures showing spending dropped by more than 60 per cent over the first nine months of the year.

Figures sourced by The Australian from ad expenditure analysis firm Standard Media Index indicate the total agency revenue spent with X for the first nine months of the calendar year Australia-wide was a meagre $7.12m, “which represents a fall of 61.4 per cent from the same nine months last year’’ the organisation said.

“To provide context, in the same period Guideline SMI’s total ad spend for the social media sector grew 2.8 per cent.’’

The social media site with the fastest growing advertising revenue was TikTok, up 55 per cent on the same period last year.

“There’s clearly been a lot of change within the social media sector over the past year as key players change their strategies,’’ SMI APAC managing director Jane Ractliffe told The Australian.

“But overall the sector continues to grow and remains the third largest sector within digital media.”

The ad expenditure drop was before Mr Musk’s most recent controversy, with the head of X, Tesla and SpaceX appearing to endorse anti-Semitic views expressed in another user’s short message on the platform, which led to major advertisers in the US cutting ties with the company.

Linda Yaccarino, CEO, X/Twitter. Picture: Getty Images

A message posted on X about two weeks ago said Jewish communities had “been pushing the exact kind of dialectical hatred against whites that they claim to want people to stop using against them”.

Mr Musk shared the post with the comment, “You have said the actual truth’’.

Shortly after this, IBM, in a response to a report from advocacy group Media Matters which said advertising from major corporations had appeared next to anti-Semitic content, announced it was pulling all advertising from the platform.

“IBM has zero tolerance for hate speech and discrimination and we have immediately suspended all advertising on X while we investigate this entirely unacceptable situation,” the company said.

Other major corporations which have reportedly pulled their advertising from X include Apple, Comcast, Sony, Paramount and Lions Gate.

Lions Gate said in an interview with film industry publication Variety it had “suspended advertising on X because of Elon Musk’s recent anti-Semitic tweet”.

X chief executive Linda Yaccarino said: “While some advertisers may have temporarily paused investments because of a misleading and manipulated article, the data will tell the real story — we’ve been extremely clear about our efforts to combat anti-Semitism and discrimination, as there’s no place for it anywhere in the world.’’

Executive Council of Australian Jewry co-chief executive Peter Wertheim told The Australian advertisers should avoid the ­platform.

“It is hardly surprising that advertisers have been deserting social media platforms like X in droves,’’ Mr Wertheim said.

“These advertisers have realised that the torrent of anti-Semitism and almost every other form of racism and bigotry that infests commentary on these platforms does damage to their brands”.

Advertising revenues at X have cratered since Mr Musk bought the platform, then known as Twitter, last October for $US44bn ($67bn). Recent reports have valued the company at just $US19bn.

In July Mr Musk posted that X’s cash flow was negative, caused by an almost 50 per cent drop in advertising revenues and a large debt load.

In the year since the takeover, Mr Musk has gutted content moderation, restored accounts of previously banned extremists, and allowed users to purchase account verification, helping them profit from viral — but often inaccurate — posts.

X has a policy of not responding to media requests for ­comment.

Additional reporting: AFP