Elon Musks Politically Polarizing Effect

Looking just at 2022, net favorability toward Twitter among Democrats dropped 23.6 points from net +20.4 percentage points in January to -3.2 in this month, and is rising among Republicans. Similarly, and perhaps most of note for advertisers, trust in Twitter among Democrats plummeted 29.3 points from net +12.6 to -16.7.

These sudden and massive shifts in perception are increasing the risk of advertising on Twitter as the rules around content moderation seem to be in flux or absent altogether. This only compounds the uncertainty created by layoffs and attrition at Twitter that have put its product development and data security in jeopardy, along with the bungled rollout of the company’s new verification system, Twitter Blue, which led to a spree of “verified” accounts impersonating celebrities, politicians, governmental organizations and brands. 

The impact of the latter is already proving significant. Just last week, an account impersonating the pharmaceutical company Eli Lilly and Co. tweeted that the company would make insulin free; Eli Lilly had to officially respond that this was not the case. For an $8 subscription, an impersonator sparked a 4.5% drop in Eli Lilly’s stock, and also potentially cost Twitter millions in lost ad revenue as the company pulled its digital ad campaigns from the platform indefinitely.

There were already hints at Musk’s polarizing effect in Morning Consult data. A recent report on expectations of corporate leaders examined who Musk’s fans and detractors are. The late September survey found that 64% of Republicans had a favorable opinion of Musk, compared with just 37% of Democrats.

Up until now, Musk’s polarizing personal brand had a limited impact on Tesla and SpaceX, but Oct. 27 acted as a break in the dam. Whereas impressions of Twitter have always been deeply divided between Democrats and Republicans, Tesla and SpaceX were largely nonpartisan with similar impressions on either side. 

Now, Musk’s sharing of misinformation about the attack on House Speaker Nancy Pelosi’s husband in a tweet that was later deleted, along with his very public and explicit endorsements of Republican positions and candidates — such as recently encouraging people to vote GOP during the midterms — are impacting the other brands he manages. 

Net favorability of Tesla is down around 20 points among Democrats since last month and up around 4 points among Republicans. Net favorability of SpaceX is also down among Democrats, but the decline has been more muted so far.

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