In 2022, Elon Musk bought Twitter for $44 billion. Since the date of his purchase, the value of the company has reportedly gone down by 45.5 percent to only $24 billion, according to industry analysts. Over the last year, there has been a lot of changes to the company, including rebranding Twitter to “X”, the everything app.
Over the weekend, Musk quietly hinted on his account that he would be renaming Twitter to ‘X’.
Along with renaming the company, Musk removed the bird logo and all the association words including “tweet” and “retweet”. According to brand agencies like Fazer, Musk’s abrupt changes removed anywhere between $4 billion to $20 billion in value from the company.
Twitter Name Change Could Cost Musk Up to $20 Billion
According to many analysts and brand agencies, the rebranding of Twitter is considered a huge mistake. In fact, analysts estimate that the change could cost Musk between $4 billion and $20 billion in value.
That would bring the estimated value from Musk’s purchase price of $44 million down as far as just $24 million in less than a year.
Steve Susi, the director of brand communication at Siegel and Gale spoke about the rebrand. “It took 15-plus years to earn that much equity worldwide, so losing Twitter as a brand name is a significant financial hit,” said Susi.
Other brands believe Twitter’s popularity were rooted in words like “tweet” and “retweet”, making it a part of modern culture. Now with the rebrand, analysts from Forrester and Research Inc believe the brand has lost 32% of its value since last year. Advertising revenue at Twitter is down more than 50% since October when Musk finally closed the deal to buy the social media platform.
Why Elon Musk Renamed Twitter to ‘X
Before buying the social media platform, Musk’s intentions were clear. He was going to use Twitter to help launch his all-encompassing social media brand. In the biggest change since his takeover of the company, Musk rebranded Twitter to ‘X’, the everything app earlier this week.
While the website Twitter.com is still alive, fans can now also access the site through X.com. There were many reasons for the rebranding of the company. On the X social media platform, Musk shared that the logo is designed to “embody the imperfections in us all that makes us unique”.
Twitter CEO, Linda Yaccarino also added shared a few posts making statements about the change. In her posts, Yaccarino voiced that X is the chance for the company to make a second big impression. The idea is to push the brand further than Twitter and transform the platform into a global town square.
The rebrand is the first step in making Twitter become an “everything app”, used for everything from communication to financial transactions. According to Musk, the ambitions for this new platform couldn’t be represented by the name Twitter, thus forcing the company to reimagine its name and place in the social landscape.
“The Twitter name made sense when it was just 140-character messages going back and forth – like birds tweeting – but now you can post almost anything, including several hours of video. In the months to come, we will add comprehensive communications and the ability to conduct your entire financial world. The Twitter name does not make sense in that context, so we must bid adieu to the bird,” shared Musk on X.
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