Barely a week into his ownership of Twitter, Musks new digital town square free-speech platform is leaving brands questioning its palatability for advertising.
Until the dust settles on Twitter, some companies are suspending their advertising spending on the platform to see whether inappropriate and hateful content on the social media giant gets out of hand under Musks new ownership. As one advertising executive told the Financial Times, Theres some quiet quitting going on.
Companies are adopting a wait-and-see approach, advertising giant WPP founder and S4 Capital chairman Martin Sorrell said at the Web Summit in Lisbon, Portugal today.
Its not clear yet from Elon Musk where he is on moderation, Sorrell said. The question is: how is that going to operate?
Clients dont want conflict, they dont want controversy, said Sorrell. They want a stable environment, and what weve seen in the last week or so is too much inconsistency.
WPP declined to comment on whether it is advising clients to pause their Twitter advertising spending.
Who is quitting?
Not all whove left have been silent.
General Motors Musks Tesla rival was one of the only companies to publicly come forward and say it would temporarily halt paid advertising on Twitter until it understands the direction of the platform under its new ownership. GM said in a statement, as is normal course of business with a significant change in a media platform, we have temporarily paused our paid advertising.
Soon after GM left the platform, Morning Brew reported that advertising giant Interpublic Group (IPG) was recommending to its clients to temporarily pause advertising spending on Twitter. IPG is one of the Big Four agency companies, alongside WPP, Publicis, and Omnicom, and manages the public relations of Coca-Cola, American Express, Johnson & Johnson, Nintendo, and others.
Meanwhile, the Financial Times reported that LOreal would suspend advertising payments on Twitter, although a spokesperson for the cosmetic giant later denied the report, telling Reuters it had not made any decision as of yet.
Musks plans
In a tweeted open letter, Musk explained his vision to marketers and appealed for them to stay on his platform: Twitter obviously cannot become a free-for-all hellscape, where anything can be said with no consequences!
He added that, Twitter aspires to be the most respected advertising platform in the world that strengthens your brand and grows your enterprise.
Musk told top advertising spenders on Twitter that he has no plans to do away with content moderation roles at the company, the FT reported. Still, with Musk reportedly planning to lay off 3,700 members of the social media companys workforce, many fear this will have an outsized effect on the brands safety.
Musk might be keen to ensure stability for advertisers, as ad sales accounted for more than 90% of Twitters revenue in the second quarter of 2022.
Yet Musks new ownership has brought on an onslaught of hate speech on the platform, with the number of racial slurs increasing exponentially following his arrival at Twitters corner office. After the news broke that Musk had closed his deal for Twitter, there was a 1,300% increase in a particular racial slur appearing on the platform, according to social media analytics firm Dataminr. At its peak, the word appeared 170 times every five minutes.
A coalition of more than 40 advocacy organizations, including NAACP and Free Press, wrote in an open letter to Twitters top 20 advertisers on Tuesday, demanding they pull their ads from the platform if Musk guts content moderation on the platform, and follows through on his plans to undermine brand safety and community standards including gutting content moderation.
Reuters reported that Musks team plans to meet with advertisers this week in New York.
Hows the platform looking?
Fears for advertisers were compounded when Musk sent out a tweet questioning the nature of the violent attack on Paul Pelosi, the husband of House Speaker Nancy Pelosi. Musk later deleted the tweet which said, There is a tiny possibility there might be more to this story than meets the eye, including a link to an article claiming the attacker was someone Paul Pelosi met at a gay bar.
He also tweeted a divisive poll on Wednesday, asking if advertisers should support free speech or political correctness. This follows months of Musk repeatedly opposing Twitters enforcement strategies, such as banning some high-profile accounts permanently.
Advertisers fears were further compounded after Twitters advertising chief Sarah Personette resigned on Tuesday, following an exodus of nearly the entire senior ranks of the company. She tweeted, I want everyone to know I do believe the new administration understands the importance of holding up the standards of GARM.
GARM is the Global Alliance for Responsible Media, a cross-industry initiative to address the challenge of harmful content on digital media platforms and its monetization via advertising.
Sorrell told crowds at the Web Summit that Twitter has historically been inflexible with advertisers and contracts, telling the company it needed to listen more and set out a moderation policy.
Until Musk sets out a more concrete approach to Twitters content moderation, the companys revenues will be on the line.
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