Elon Musk’s X Fiasco: Disney, Comcast increase ad spend on Instagram following owner’s tirade

In the wake of the massive advertiser exodus from X, several prominent US companies, including Walt Disney and Comcast, have significantly increased their advertising expenditure on Instagram, as reported by Reuters, based on a Sensor Tower investigation. Data reveals a 40 per cent surge in US spending by Disney and approximately 6 per cent by Comcast on the Meta-owned app in the two weeks following November 20. Paramount, in a parallel move, tripled its advertising spending on Snapchat during the same period. This shift in advertising strategies illustrates the challenges faced by Elon Musk, the owner of X (formerly known as Twitter). Musk encountered a significant loss of advertisers on the platform after endorsing an antisemitic post that falsely accused members of the Jewish community of promoting hatred against white individuals. Despite Musk’s subsequent apology for sharing the offensive content, the platform continues to witness a decline in advertiser confidence. “Brands are intelligent about these choices, and any brand safety concerns will be met with a re-allocation of budgets away from troubled platforms,” remarked Felipe Thomaz, an associate professor of marketing at the University of Oxford. At present, neither Disney, Comcast, Paramount, nor X has issued an immediate response to requests for comments on the matter. According to Sensor Tower’s data, 51 of the top 100 U.S. advertisers on X, since Elon Musk’s acquisition of the platform in October of the previous year, have ceased advertising spending as of November 2023. Additionally, the platform has experienced a 16% decrease in monthly active users since Musk’s takeover, while user engagement has remained stable, according to the market intelligence firm. A recent report by Bloomberg News has indicated that X is on track to face a substantial decline in ad revenue for the current year, estimated at around $2.5 billion. Mobile analytics firm data.ai suggested that, alongside a series of mismanagement and public image setbacks for X, there is a general trend of users shifting from text-based social networking apps to platforms focused on photo and video content. The report emphasized a changing landscape in how consumers absorb news content.