Struggle for X: Sarcastic AI Chatbot Grok Fails to Attract Advertisers

Despite X's efforts to use its AI chatbot Grok in attracting advertisers with sarcastic responses, the platform faces challenges as Grok's lack of functionality and crude tone deter major brands. Ad revenue decline and Musk's controversial image contribute to the struggle, prompting a shift towards smaller businesses with discounts.

X's Struggle to Attract Advertisers with Sarcastic AI Chatbot Grok

X, the platform formerly known as Twitter, is attempting to attract advertisers using its AI chatbot, Grok. Grok, part of Xai, offers sarcastic and sometimes flippant responses, a feature designed to contrast with what owner Elon Musk describes as "woke" culture. Despite these efforts, Grok has not gained traction with advertisers.

According to advertising industry sources, Grok's functionality is basic and unhelpful for experienced brand and social media managers. Unlike AI tools from competitors like OpenAI and Meta, Grok lacks the ability to create imagery, limiting its usefulness. It primarily generates text for X posts that can be used as ads, but its sarcastic tone and crude responses have not appealed to brands.

Since Musk's acquisition of Twitter for $44 billion in late 2022, the platform has struggled to retain users and advertisers. Advertising revenue, which was around $4 billion in 2022, plunged by approximately 50% the following year. Despite efforts such as live video introductions and courting right-wing influencers, major brands have pulled back, citing concerns about rising hate speech and Musk's controversial statements.

Currently, X is focusing on attracting small and medium-sized businesses as large advertisers remain hesitant to return. The company is offering a $200 discount on any ad buy to lure these smaller advertisers.