X adjusts its ad strategy to attract small and medium-sized brands

In a bid to revamp its advertising strategy, X is intensifying its efforts to appeal to small and medium-sized businesses. This move comes in the wake of a public outburst by the company’s owner, Elon Musk, and is aimed at shoring up the platform’s ad business, which has been underperforming. The new strategy seeks to provide a more welcoming and conducive environment for smaller brands to advertise on X. According to the Financial Times, after more than 100 brands such as Apple and Disney announced that they would stop advertising, the X platform actively adjusted its strategy. The company is hoping to attract more small and medium-sized brands to run more ads.

The X platform is increasing investment to promote advertising expenditures of small ad companies. This is in an attempt to offset the huge revenue losses caused by the departure of large advertisers. X has been working with small and medium brands before now. However, after the exit of many big brands, these small and medium brands are now its priority.

Background

The decision to refocus X’s ad strategy stems from Elon Musk’s recent criticism of the platform’s approach to advertising, particularly its treatment of small businesses. Musk’s public rebuke highlighted the need for X to reevaluate its ad policies. It also shows the need to make the platform more accommodating to a wider range of advertisers. This includes small and medium-sized brands.

In a recent post on X, Elon Musk claims not to care whether or not the big brands place ads. To boost the shaky advertising business of X, it is actively attracting small and medium-sized enterprises to place ads.

Elon Musk, the owner of X, has been facing backlash from advertisers after he endorsed an antisemitic conspiracy theory on the platform. As a result, dozens of major brands have paused their marketing campaigns on X, and the platform could lose up to $75 million in advertising revenue by the end of the year. According to Reuters and WSJ, in response to the boycott, Musk has used expletives to criticize advertisers who have left the platform, telling them to “go f— yourself”. He has also referred to the boycott as “blackmail” and said that he does not care about advertisers that have halted spending on X.

However, advertisers have said that they do not plan to return to X anytime soon, with some temporary spending pauses likely to turn into permanent freezes. Lou Paskalis, the founder and CEO of AJL Advisory, a marketing consultancy, has said that Musk’s expletives against advertisers are the “closing chapter” for brands doing business with X and that they are “not going to forget that”. The situation has put pressure on X overall, including its CEO. Some experts have suggested that the boycott could ultimately lead to the platform’s bankruptcy.

Targeting Small and Medium-Sized Brands

X’s new ad strategy is centred on creating a more inclusive and accessible advertising environment for small and medium-sized brands. This involves revising the platform’s ad policies, streamlining the ad creation process, and providing more targeted and cost-effective advertising options for smaller businesses. By doing so, X aims to level the playing field and provide smaller brands with the opportunity to reach and engage with their target audiences more effectively.

However, X will likely face some issues with attracting the small and medium-sized brand market. This is because these brands usually do not have the kind of budget that the big brands possess. Nevertheless, X is now relying on its sophisticated self-service ad-buying tools. These tools allow business owners who don’t understand advertising to easily target the right potential customers.

One issue that X will likely face is that it is not the only one that has its sight on the small and medium brands. The transition for X may be hard because it will have the likes of Meta, Google and TikTok to battle. These brands have world-class ad platforms and X will have to step up.

According to ITHome, the CEO of X, Linda Yaccarino is under pressure from friends and former colleagues. They are asking her to resign to protect her reputation. However, if she can pull through with the challenges at X, it could also be a turning point in her career.

Enhanced Support and Resources

In addition to revising its ad policies, X is also ramping up its support and resources for small and medium-sized brands. This includes providing dedicated account management and ad support for smaller advertisers, as well as offering educational resources and best practices to help them maximize the impact of their ad campaigns. By offering these additional support services, X aims to empower smaller brands to navigate the complexities of digital advertising and achieve their marketing objectives on the platform.

Another key aspect of X’s adjusted ad strategy is the emphasis on data and insights to help small and medium-sized brands optimize their ad campaigns. X is leveraging its vast trove of user data and analytics to provide smaller advertisers with valuable insights into their target audiences, ad performance, and industry benchmarks. This data-driven approach enables smaller brands to make more informed decisions and refine their ad strategies to drive better results on the platform.

Conclusion

In conclusion, X’s revamped advertising strategy represents a concerted effort to attract and support small and medium-sized brands on the platform. By revising its ad policies, enhancing support and resources, and leveraging data and insights, X aims to create a more inclusive and conducive advertising environment for smaller advertisers. This strategic shift not only aligns with the evolving needs of the advertising landscape but also underscores X’s commitment to empowering a diverse range of brands to succeed on the platform.