In 2011 Tesla stated aim was to be the world’s leading car company of the C21st, accelerating the transition to EVs. At the time it was easy to dismiss Musk as crackers. In the eight years since its founding in 2003 they had shipped just 1,650 EVs – although its first big-selling car, the Model S, had yet to be released. Today it is almost as mad to argue that Musk has not achieved his goal. In Q1 2023 Tesla’s Model Y was the world’s bestselling car; in Q2 it delivered 466,000 cars, beating analysts’ forecasts. Musk’s prediction of 2m sales this year seems achievable.
Besides reimagining the car and the car industry, his focus on streamlined manufacturing a small range of vehicles has kept costs down – Tesla’s operating margin is 17%; among non-niche carmakers only Porsche, which churns out <1m cars annually, comes close. Musk’s ambition is to dominate the sector by making 20m cars a year by 2030, double the current output of today’s top manufacturer Toyota, and create the go-to self-driving system. Incumbents are scrambling to electrify their ranges and copy Musk’s vertically integrated production.
But what of his other venture – the social media platform known as Twitter? It will now be called ‘X’ as Musk rebranded to build ‘X, the everything app’. It harks back to when he shelled out $44bn to acquire Twitter, tweeting Buying Twitter is an accelerant to creating X, the everything app. His vision is that ‘X’ is the future state of unlimited interactivity in audio, video, messaging, payments, banking, creating a global marketplace for ideas, goods, services, and opportunities.
On 22 July he tweeted about plans to bid adieu to the twitter brand. On 23 July, X appeared on the website and app, and Twitter Inc became X Corp, abandoning almost two decades of brand recognition. This isn’t the first time Musk has tried to make X.com a reality, X marks the spot in a lot of ways for Musk’s obsession with the letter X for the past twenty-three years. He tried to create an online bank with the name but it failed (it became Paypal). He stuck the letter on his space company, Space X, a Tesla model, and even one of his children (X Æ A-12 Musk). Just two weeks ago he launched xAI to deliver ‘pro-humanity’ to secure a safe future in AI.
X captures Musk’s ambition, building an ‘everything app’ akin to China’s popular Tencent’s WeChat (1.3Bn users), which doesn’t have a US or European parallel, where it’s part of the fabric of day-to-day life. Where the iconic bluebird once sat, a sinister black X now exists, making the site look like a salacious dating app or the homepage of a sinister political movement. Musk crowdsourced the ‘X’ logo from users on Twitter. Never mind he is abandoning a brand so ubiquitous that ‘tweet’ and ‘retweet’ have become part of our culture in exchange for a single letter that is impossible to trademark.
The bluebird adorns company websites worldwide, alongside Instagram and Facebook logos. X will require the company to rebuild that positioning from scratch. Other tech companies have renamed themselves – Google turned into Alphabet to allow different businesses within the company to grow without being tied to search, Facebook changed into Meta Platforms to emphasise the commitment to the Metaverse. But the product names remained – we still google things by going to Google. That’s worth a lot.
When it comes to the worst rebrands in history, the competition is fierce. In 2001 the Post Office tried to remarket itself under the new name ‘Consignia’; in 2009 Pizza Hut dropped the word ‘Pizza’, announcing it would be known simply as ‘The Hut’. Neither lasted long. But does X work? Two thoughts are that it’s too common and so broad as to be meaningless. For me, it recalls the X- Files, Generation X, Malcolm X. And will there be litigation? Microsoft has owned an X trademark relating to its Xbox video game system since 2003, and Meta registered a mark for X in 2019 for software and social media!
So, what are the takeaways of Musk’s outlandish decision for startup branding? Once you start thinking of your business as a brand, you can shape how customers perceive it, and I’m sure Musk will push this point hard. Maybe Marmite is a brand he can learn from – yes, that thick, black, glossy, yeast-based extract – enjoyed with butter on toast, or with hot water as a beef tea. It has been an iconic brand for over a century. Owned by Unilever, it’s been in our kitchen cupboard for donkeys’ years, with its reassuringly heavy cauldron-shaped jar, chunky yellow lid and no-nonsense red name label.
Marmite is made from yeast extract, a by-product of beer brewing. The product is notable as a source of B vitamins. It’s a sticky, dark brown paste with a distinctive, salty, powerful flavour and matching heady aroma. The name comes from a marmite, a French term for a large, covered earthenware or metal casserole dish (pronounced Marmeet). The product that was to become Marmite was invented during the late C19th when German scientist Justus von Liebig discovered that brewer’s yeast could be concentrated, bottled and eaten. This lead to the formation of the Marmite Food Extract Company in Burton, where Bass Brewery supplied the yeast.
The discovery of vitamins was a boost for Marmite, and British troops during WW1 were issued with Marmite as part of their rations. During the 1980s, the spread was advertised with the slogan My mate, Marmite, chanted in television commercials by an army platoon. Then marketing agency BMP DDB were appointed to refresh the brand. I remember sitting in my office looking at the brief and saying to Richard Flintham ‘I fucking hate Marmite’ said Andy McLeod, and he said ‘Oh, I love it’. And we both just looked at each other – and the Love it or Hate it campaign was born in October 1996.
So, on one side of this blog Marmite, an established brand with heritage and longevity. The contrast couldn’t be starker to X. What do both say to start-ups balancing their focus on their target market, while also pushing an innovation edge? Your creativity, agility, and risk-taking are your hallmarks but you have to build a trusted brand too. Let’s combine the marketing and brand building lessons of Marmite and X, what are the key lessons here?
1. Segmentation, targeting, positioning
X will ultimately use demographic and psychographic data to segment its users, based on actual behaviour, with micro-level segmentation on each individual user, enabling them to ultimately convert visitors into long-term, high-value repeat customers for their future commercial platform.
From the start, Marmite was heavily advertised through campaigns that tapped into the mood of the public. It was British and they worked hard to make sure it was a food of choice of the army and was patriotic and nutritious. Marmite was cannily marketed as a food that could make everyone healthy.
Takeaway: Be clear with your purpose and connect with people as individuals, crafting a brand message that resonates with your vision. Let’s see what X decides it wants to be.
2. Customer analysis
X’s target market will be e-commerce users and digital natives, comfortable with online ‘for everything’. Marmite has more specific target audiences, one is to be a staple for thousands of football supporters up and down the country, gulping down steaming hot cups of Marmite, easing the chill of a winter’s afternoon and sometimes the pain of conceding a goal. After all, it’s what the Thermos flask was invented for.
Takeaway: What’s the special thing only YOU can do that your customers will miss out on if you never existed? Understand your customers’ problems and how you can solve them, then ensure you provide enough touchpoints for repeat purchases, building customer retention and loyalty. Musk is seeking to own the ‘digital village’ for everything, for everyone, an audacious ambition.
3. Distribution strategy
I expect X will seek to replicate Amazon’s strategy – it understands that the most important thing customers want is the range of offerings and speed of delivery. In Marmite’s case, by 1930, over 3,000 grocers were selling it, and it subsequently became a ubiquitous product.
Takeaway: Ensure your startup has clear routes to catalysing a market, enabling rapid, simple and scalable connections that reach your customer audience. Create a brand promise and experience, create a real tone of voice that energies your network. Marmite has this, Twitter had it too, again let’s see how Musk can attract and retain users via its digital presence.
4. Build Brand equity
Taking another example from Amazon. Bezos’ vision was creating the ‘A to Z’ company for e-commerce, and built its brand equity on that capability. For Marmite, inventor von Liebig also enjoyed publicity – advertising connected Marmite to the popular physical culture movement by getting sporting celebrities to endorse the brand. One of these, the world’s strongest man at the turn of the C20th, an Adonis-like star called Eugen Sandow, had developed his rippling muscles so that his body resembled a classical sculpture which he showed off to enormous crowds in the music halls – claiming Marmite game him the physique.
Takeaway: Build your brand reputation and illustrate your engagement. Differentiate yourself and create your image – but go beyond a logo. Now that’s going to be a challenge for Musk.
5. Product
Marmite has been produced as a ‘special edition’ product – Guinness flavoured for the Rugby Six Nations, Champagne flavour for Valentine’s Day, and in 1912, a special edition jar in commemoration of the Diamond Jubilee of Queen Elizabeth II, with the product renamed Ma’amite, the redesigned label featured a colour scheme based upon the Union Jack.
Takeaway: Great brands stand for something that they extend as a ‘promise’, and they’re consistent about their values in everything they do. Musk is a risk-taking maverick, a ‘marmite personality’ himself. His own personal brand is strong, it stands as a beacon for entrepreneurship, but will he regain the trust of corporates and halt the decline of advertising revenues?
I’ve lost count of the things that Musk has done to Twitter which triggered surprise and the bells of doom ringing loud. The obsession with Elon is such that we all make judgements, and there’s little introspection. Business experts queue up on social and broadcast media to tell us that the world’s most successful entrepreneur is being an idiot, and how much smarter and wiser they’d be in his shoes.
Whatever we think, he’s not going to fail no matter how outlandish his decision making, leadership style and actions appear. Stop betting on Musk’s failure, it’s best to accept his propensity for eventually getting it right. X may take a long time and deep pockets to sort, Musk could double the revenue and users of X, likewise he could lose another 50% of the revenue again. However, his odds are increasing as when you’ve survived so many apparent and real business catastrophes, and you’re still alive, you’ve shown resilience. He’s that if nothing else.
Musk is like Marmite, you love him or hate him, but the kerfuffle over the new X branding has turned into a wall of noisy opinions, another ideological skirmish about the man himself. He’s delivered on Tesla. I think he will succeed with Space X. xAI? Bet he delivers on that too.
In a sea of sameness, blending in is not an option. A new logo alone won’t cut it. Your startup needs to be different to make a difference. Become a brand people can’t ignore. A true challenger. Elon’s rebranding is radical, but he’s pivoted his product strategy and executing his vision. It’s not going to be boring to watch his strategy unfold.
