Small- and medium-size business owners are angling to take advantage of the stampede of big advertisers away from X – with the little guys betting it will enable them to reach a wider audience on the platform, sources told On The Money.
While major advertisers like Disney, IBM and Comcast have yanked hundreds of millions of ad dollars away from Elon Musk’s social network amid controversies over antisemitism, some small business owners are quietly grateful for the drama – and say they’re using this as an opportunity to buy up ads on the cheap.
“I’m no longer competing with the big guns,” one business owner said of his decision to begin buying ads on X. “All the top investors and high-profile business people I want to reach are still on the platform.”
The drop in ads is a big problem for the company formerly known as Twitter. While X is pushing to grow other business lines, 75% of the company’s revenue still comes from advertising and 80% of its advertising revenue comes from big businesses advertisements, sources add.
X is on track to bring in $2.5 billion in ad revenue this year – less than the $3 billion advertisers had projected to make this year and a serious miss from the $4 billion X made in advertising revenue in 2022, according to a Bloomberg report this week.
But X is leaning into the disaster, for a lack of better options – and added a blog post to that effect this week.
“We want to do MORE for small and medium sized businesses. With X, we’re now positioned to become a single interface for SMBs.”
A spokesperson for X highlighted the fact that small and medium businesses can easily buy ads on the platform without an agency, aren’t committed to a long term contract and can spend any amount they’d like.
Even as one advertiser said some amount of hate speech on the platform is “inevitable,” he said the reinstatement of conspiracy theorist Alex Jones was enough to make him briefly reconsider an ad spend. “I’m furious at Elon… why would he do that?”
Last month, Musk told advertisers to “go f–k themselves” – even as he conceded that without them the platform could go belly up.
As to the user experience, many on X say they’ve recently seen a hodgepodge of random advertisers.
“I’ve gotten the most random ads – Invest Qatar, The Investor’s Edge, NextAfter – I’ve never heard of any of these,” one source who started noticing the random ads said. “Seems like they’re scraping the bottom of the barrel.”