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Can Elon Musk's Rebranding Strategy Save a Failing Company?

A year or so ago a friend of mine decided to change his name – his first name. This is highly unusual. Whether you like it or not you are given your name by your parents. You grow up with it and grow into it. When somebody mentions your name it automatically positions you in their mind. It has connotations that identify you in every way – your personality, your physical characteristics, the things that distinguish you. In a way your name is your brand. If you decide to change it, it must be for a very good reason. My friend decided to change his name because he said he didn’t like the one bestowed him.

This doesn’t seem logical to me. Someone who wants to start a new life in a new place might decide to change their name but even here they would have to have a good reason. Inevitably the change of name by my friend caused him a range of problems. There was the bureaucratic nightmare of changing the name on his bank account, driving licence, passport, and email address – you can’t imagine the number of records that need changing for a small adjustment in what you call yourself. That was just the start of it. His friends and family and colleagues at work just didn’t get it. They carried on calling him by his original name. Things have settled down a bit now but I can’t help wondering “was it worth it”.

And so it is in business. All businesses have a name; it is their brand. It is used by customers, suppliers, employees and anyone who wants to talk about it. Building up an awareness of that name takes time and costs money. Associations are created with the name and they have a value. It is generally agreed by marketers that a company name should not be changed except in the most dire and compelling circumstances. And yet, people do it.

Elon Musk is a genius. He has built Tesla and SpaceX into huge successful companies that have made him the richest person on the planet. And then he went and spent a crazy $44 billion on Twitter. Maybe he knows something we lesser mortals know. What has made me further question his business nous is the change of the name of Twitter to X.

If Twitter was a new company it wouldn’t matter so much. Name changes are fairly common for small and new tech companies. Snapchat started as Picaboo. Instagram was originally called Burbn. Google began life as BackRub. In fact Twitter was born as Twttr. However, changing brands later in life is different. An established corporate brand will have created a place in the shelf space of thousands if not millions of people’s minds. Sometimes the marketplace does the rebranding itself. Lengthy names such as Imperial Chemical Industries get shortened (by customers and employees) to a simplified ICI. Kentucky Fried Chicken is commonly known as KFC. In a bar or restaurant you are likely to ask for a Coke rather than a Coca-Cola. The Procter & Gamble Company is regularly referred to as P&G. These are incremental changes to the brand and crucially they are generated by the marketplace, not as a radical rebrand. Radical rebrands seldom work. Alitalia, the Italian legacy airline, changed its name to ITA Airways in 2021. Not surprisingly, it has failed to get traction.

Another strange one is Facebook’s switch to Meta. This was supposed to show the company’s future lies in the metaverse even though this part of the business contributed just 1% of group revenue and nothing in profits. Meta has money and heft and so they may make the rebrand work - but you have to question what on earth were they thinking.

So what is with Musk’s new brand X? Well, we know that Musk has a long history with the letter X. There is the Tesla Model X, SpaceX, a son called X AE A-XII (that must be difficult for teachers to pronounce). Anyway, obsessed by the letter X, Musk has chosen it for his rebrand. It was a rubbish idea to buy Twitter for $44bn and it is a rubbish idea to rebrand it. At least that is the received wisdom of most marketers. But who knows. Musk has been known to pull rabbits out of the bag. We wait agog.


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