X's sales pitch: Give us your advertising business or we'll sue

Elon Musk and CEO Linda Yaccarino launched a campaign to strong-arm advertisers back onto the platform

- Suzanne Vranica, Dana Mattioli & Jessica Toonkel

Late last year, Verizon Communications got an unusual message from a media company that wanted its business: Spend your ad dollars with us or we'll see you in court. The threat came from X, the social-media platform that has been struggling to resuscitate its ad business after many corporate advertisers fled over concerns about loosened content-moderation standards following Elon Musk's $44 billion purchase in late 2022.

It worked. Verizon, which hadn't advertised on X since 2022, pledged to spend at least $10 million this year on the platform, a person familiar with the matter said.

Fashion company Ralph Lauren also agreed to resume buying ads on X after receiving a lawsuit threat, people familiar with the matter said. All told, at least six companies that had either received lawsuit threats or were motivated in part by pressure tactics have struck ad deals with X, according to people familiar with the negotiations. The agreements include both firm ad-spending commitments and nonbinding targets.

The legal threats are part of an extraordinary pressure campaign that Musk and X CEO Linda Yaccarino launched to boost revenue by cajoling advertisers—including Amazon, Unilever, Pinterest and Lego—to spend money on their platform. X has accused some of them of illegally colluding with one another on an ad boycott. Its tactics have generated a climate of fear on Madison Avenue.

"The strong-arm tactics" are unusual and worrisome for marketers, given Musk's influence in Washington and "bully pulpit" of 221 million followers, said Greg Paull, president of global growth for MediaSense, a consulting firm that helps match advertisers with ad agencies. Despite his fallout with Trump last week, Paull said, Musk still has plenty of access to government officials.

"This type of activity may be common on Nanjing Road in China, but absolutely not at all common on Madison Avenue," Paull said.