With a single tweet—err, post—on July 23, announcing Twitter’s move to X, divisive tech entrepreneur Elon Musk, who ponied up $44 billion for the platform and its 425 million users in October 2022, wiped out up to $20 million in brand value, according to analysts. More losses have followed: ad revenue is down 60 percent, staffing shrunk by 80 percent as the result of layoffs, and by Musk’s own math, the platform has lost 90 percent of its value as of early September. Will users follow, fleeing to Threads and Mastodon like digital eXpats?
Q. Will we ever adopt the new moniker, or is the platform doomed to be referred to as “X (formerly known as Twitter)?”
A. Consumers are hesitant to adopt name changes, either intentionally or by habit. Although Twitter is not an “old” company, it has been known by that name for nearly 20 years. Rebranding is a tough task that many businesses fail to complete successfully due to the power of a brand name and the link to a brand’s identity in the minds of consumers.
X’s future is uncertain; therefore, most users have been unwilling to start using the new name. A successful rebranding includes an updated vision, mission, and core changes to brand assets—none of which seem to be fruitful for X right now. Also, the goal of any rebrand is often to grow a company by better serving consumers, but it seems like X has not seriously considered the strategic implications of its name change. Although X may offer other functionality in the future—it has promised to be a one-stop-shop for nearly all online activities—it still very much resembles Twitter, so there is no reason for users and consumers to think of it differently. Until users see a benefit to calling the platform X, it will continue to be referred to as Twitter.
Q. Elon Musk is a polarizing figure. Will that help or hurt X?
A. It depends. If we are talking popularity and buzz, then having a mega-popular billionaire run the company is absolutely an asset. Despite the controversy surrounding him, having Musk associated with a brand drives up the recognition, and in many instances, support. Musk has a loyal fanbase—both in the real world and on X, where he boasts 157 million followers—and that creates a pool of users that will likely accept all changes made to the Twitter platform. However, Musk’s takeover of Twitter has been strongly linked to political effects of the brand, including allowing certain profiles that were previously banned for violating rules on hate speech and misinformation to jump back on the platform, and changing content moderation policies. The eccentricity of Musk is scary to a lot of “non-followers.” Ultimately, it seems like his tenure will be marred with controversy and will result in a dip in users.
Q. Musk has said he envisions X as the “everything app.” What does that mean?
A. Twitter remained largely unchanged since Jack Dorsey posted the platform’s first-ever message in 2006. Musk is trying to incorporate several of his other brands with X and make it a multi-faceted platform, much like WeChat—a Chinese app that integrates instant messages, social media, and mobile payments. These types of platforms serve as digital town squares where users spend a lot of their online time. To dominate in that space, however, X will have to beat out Facebook, Instagram, Amazon, and other competitors.