Why Elon Musk’s rebrand of Twitter to X is a brilliant idea poorly executed

Elon Musk’s vision of turning X, formerly known as Twitter, into an ‘everything app’ has the potential to revolutionise how we interact with the internet
Executing that vision faces many issues, including a lack of trust among users and failure to make clear what new value the rebranded platform provides

Sid Mohasseb

Published: 3:30pm, 5 Oct 2023

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In a memo to staff, Elon Musk said his social media company was worth about US$20 billion. He paid US$44 billion for it. That is a big loss after he rebranded Twitter as X.

While many branding gurus, keyboard warriors and journalists argue that he made a giant mistake, I do not agree. His vision to make X an “everything app” could challenge the stronghold of multifunctional platforms such as Facebook and WeChat and possibly revolutionise the way we interact with the internet.

To realise that vision, Musk must quickly learn how to attract the right audience, strengthen the platform’s tech capabilities and deliver unique, repeatable and expanding value.

Considering how most social media platforms are struggling to turn a profit when advertisements are their main source of revenue, the “everything app” idea makes sense. Twitter already had problems staying afloat as the company’s cash flow went negative amid a nearly 60 per cent drop in ad revenue, a trend Musk blamed on advertisers trying to drive Twitter to bankruptcy.

Other platforms such as Snapchat, Meta and Reddit are already introducing subscription models to curb the slowed growth of digital ad revenue and differentiate themselves. Musk tried this, but most users of his platform were not interested in paying for special features.

The main problem with trying to make X the “everything app” of the West boils down to execution. Musk has changed the logo of the app without solidifying how its identity differs from Twitter. As a result, the platform lacks any unique traits that customers can recognise and connect with, leaving them confused and annoyed at the shift.

02:18

Musk announces plans to turn Twitter into ‘X’ super-app similar to China’s WeChat

Imagine if Apple and Nike switched brand identities overnight, leading the former to focus on the courage to excel while the latter attempts to position itself as the company that thinks differently about sports apparel. That would confuse consumers and make the public question their connection with each entity.

Changing your brand is about changing your identity as well as your offering. For a brand to be trusted, it must walk the talk. Twitter was a messaging platform and trusted for that. X is not an all-inclusive video, audio, messaging, banking and payment platform and has not yet earned the right to be trusted.

Musk is trying to make X into something much more than a blue bird. However, existing users must first see the value and appreciate it before they love and engage with the brand. Confused consumers don’t buy.

What happens if anyone can buy Twitter’s ‘blue tick’ status?

This confusion does not help when more than 300 million X users are not the “right” kind of audience for the vision Musk has. Users who are mostly looking at and sharing news are not interested in using that same platform for banking, paying for purchases or establishing voice and video connections. This simple fact highlights how Musk did not think through his rebrand. He just moved fast and broke things.

To really bring X to life, Musk and his team will have to be quick with scaling and executing their added features. If they cannot soft-launch them within the next six months, the platform will represent nothing but a failure to both new and old users.

If X wants to take on Chinese powerhouse Tencent, the creator of WeChat, it will have to be agile in its strategy.

02:34

Pay with your palm: Tencent launches new payment method in China

WeChat launched in 2011 as a messaging app, but it has quickly landed among the most widely used social media networks worldwide. Since its launch, the app had reached more than 1.3 billion monthly active users worldwide as of the end of June. It allows users to send money, chat and call one another, as well as utilise various social media-like features. What is even more impressive is how seamlessly the app has been integrated into Chinese culture and reportedly accounts for about a third of total data traffic in China.

Musk has a good deal of work ahead of him if he plans to emulate WeChat’s robust capabilities. The company claims to be “moving at the speed of light” throughout this rebrand, but I suggest it does not reinvent the wheel. Avoiding the “not invented here” syndrome and applying open source programs and existing designs can accelerate X’s journey to becoming the West’s “everything app” and help save the company from sinking.

Execution in a software-centric social platform environment is not about ego or what someone smart thinks is right. It is about speed of value delivery. It is about being constantly aware of the audience and their value exchange, or what they get versus what they give the company: engagement, data, subscription fees, advertising clicks and so on. It is about regular micro adjustments and value enhancement, not the annual or semi-annual introduction of features.

Today, X has lost its purpose and does not have a character or clear value for people to embrace it. Revenues at X might pick up with the recent introduction of political ads, but the action seems like providing oxygen and morphine to a patient suffering from cancer. It might feel good, but it is not a cure.

The rebranding of Twitter might have been among Musk’s better ideas despite the carnage resulting from losing the value of an established brand. However, a brilliant idea poorly executed is only a failed dream.

Sid Mohasseb is a best-selling author, serial entrepreneur and investor, university professor, and a former KPMG managing director in charge of strategic innovation