Many advertising agencies are advising clients, albeit reluctantly, to invest in advertising on X, Elon Musk’s social media platform. Some experts are talking about an “Elon tax,” with companies forced to allocate a portion of their advertising budget to X as a kind of insurance policy against boycotts and investigations. Musk has already taken legal action against companies that have boycotted X, accusing them of collusion. Business Insider has heard from several advertising industry insiders who have complained that Musk has gained so much political power as a central force in Donald Trump’s White House.
As Business Insider reports, some specialists working in the advertising industry said they were irritated by the situation. Several marketers, agency executives and consultants have even requested anonymity for fear of retaliation. On Tuesday, research and consulting firm Forrester, one of the world’s most influential firms headquartered in Cambridge, Massachusetts and specializing in helping business leaders develop advertising strategies, published a blog post criticizing X and advising advertisers “to invest in advertising on the platform to avoid repercussions.”
Analysts wrote that advertisers were “losing control of media choice” in the political environment and advised them to “make non-binding advertising commitments to X” and gradually increase spending if X meets specific targets.
“As long as Musk maintains his position, you have to be a little more cautious,” said a 20-plus year veteran of ad agencies. “That’s the reality.” Moreover, the situation among advertisers is so tense that several industry insiders said that if X really used these tactics, it would be bullying. Yet, according to X’s CEO, advertising expert Linda Yaccarino, X’s economic situation does not appear to be booming despite contemplating clients of the caliber of Apple. An advertising industry veteran who remains anonymous said, “I’ve never seen anything like this in the history of our business,” referring to the current political environment in which advertisers work, but added, “right now you have to play defense.”
