On Sunday, Elon Musk, owner of Tesla and Twitter, announced that Twitter’s product name would be changed to ‘X’ and also he is changing the bird logo and all the associated words, including ‘tweet.’
According to analysts and brand agencies, changing the name of Twitter is a big mistake. It is unusual for corporate names to become so intertwined in daily conversation that they become verbs. It’s uncommon for any famous brand to announce plans to destroy it deliberately. Musk’s move wiped out anywhere between $20 billion and $4 billion in value.
Steve Susi, director of brand communication at Seigal & Gale “It took 15-plus years to earn that much equity worldwide, so losing Twitter as a brand name is a significant financial hit.”
Since Musk has taken over Twitter, it has significantly declined in value. On Saturday, the company announced the news of bringing a change. By Monday, a new black ‘X’ logo design appeared across the site.
Linda Yaccarino, new chief executive officer outlined the company’s vision for X to become a site for audio, video, payments, messaging and banking.
Need To Redesign From Scratch
Analysts and brand agencies are unhappy with the decisions and declare a name change a big mistake. Twitter is one of the famous messaging platforms and the most recognizable social media brand.
Joshua White, assistant professor of finance at Vanderbilt University, stated that Twitter became popular due to different verbs associated with it, such as ‘tweet and retweet, ‘ part of modern culture, regularly used to explain how politicians and celebrities communicate with the public.
The company will have to entirely reconstruct that cultural and linguistic consensus to support X. Users are requested to stop comparing Twitter-post takeover to its previous version, which may be a part of the motivation. It’s a scarce thing “- in life or business, “-Yaccarino tweeted.
In the past few years, many companies, such as Google, have changed their names and turned to Alphabet Inc to enable different businesses within the company to boost without any ties. Facebook changed into Meta to emphasize the company’s promises to the Metaverse.
According to the analysis by brand valuation consulting services, Elon Musk’s Twitter is at $44 billion, Facebook brand at $59 billion, and Instagram is at $47.4 billion.
Significant Decline In Brand Value
Determining the brand value is challenging as there is no particular way to opt for it. Due to the fact estimates may vary. But there are, various analysts and agencies agree that the company’s brand has experienced a massive hit since Musk became an owner. According to the financial analysis, the Twitter brand has lost 32% of its value since last October.
Advertisers were concerned about Musk’s decisions and controversies and the support of Twitter users who broke the rules. Twitter’s revenue has decreased by more than 50% since October.
Jasmine Enberg, an analyst with Insider Intelligence, stated that “Twitter’s corporate brand is already heavily intertwined with Musk’s brand, with or without the name X, and much of Twitter’s established brand equity has already been lost among users and advertisers.”
It’s irrational from a business and brand point of view, said Allen Adamson, co-founder of Metaforce. He named it as ‘ego decision’ .”It will be one of the fastest unwindings of a business and brand ever.”
People are also concerned about the risks associated with Musk’s visions. Building banking and payments into any app requires customer trust, which takes more work with a brand-new product name. “I just think that customers outside of Musk’s core fan base would struggle to use Twitter to exchange their money,” Vanderbilt’s White said.