Walmart Joins Advertisers Pulling Ads from X Due to Hate Speech Concerns
Walmart has made the decision to join the ranks of major advertisers withdrawing their ads from the social media platform X, which is led Elon Musk. The retail giant expressed concern over hate speech and indicated a preference for platforms better suited to reach its customers.
This move comes on the heels of a recent outburst from Musk, when he accused companies who stopped advertising on X of engaging in “blackmail”. He also advised them not to advertise. Meanwhile, X, formerly known as Twitter, has faced criticism for its lax content moderation, leading to concerns among advertisers about their ads appearing alongside inappropriate content.
Other companies that have already ceased advertising on X include Walt Disney Co., IBM, NBCUniversal, and Comcast. Their collective departure is a response to the platform’s failure to address concerns over hate speech and inappropriate content.
Despite the platform’s monumental user base and significant potential for advertising, Musk’s explicit remarks have further escalated the controversy. According to the platform’s Head of Operations, Joe Benarroch, Walmart has a community of over a million people on X. During the holiday season alone, X garners 15 billion impressions annually, and over 50% of X users conduct the majority or entirety of their online shopping.
Musk has acknowledged the potential financial consequences of an extended advertiser boycott, admitting it could lead to X’s bankruptcy. However, he placed the blame for such a collapse on the brands rather than on himself. A notable decline in monthly ad revenue and concerns voiced analysts are further complicating X’s financial outlook.
This financial downturn intensifies the challenges for X’s subscription initiatives, potentially requiring more than half of its revenue to be generated from subscriptions to compensate for the decrease in ad revenue. The declining ad revenue has continued since Musk took over in October 2022, showing a year-over-year decrease of at least 55% each month, according to Reuters.
Overall, concerns regarding hate speech and content moderation on X have significantly impacted the relationship between the platform and major advertisers. Stay tuned for more updates on this developing situation.