Rebrands can pay off – but it’s a risky move.
When Jean-Pierre Dube saw the news that billionaire Elon Musk was scrapping Twitter’s blue bird logo in favour of an Art Deco-style black and white X, the marketing professor thought it was a joke.
„Why take a recognised brand, with a lot of brand capital around it and then completely throw it away and start from scratch?“ said Prof Dube, who teaches at the University of Chicago Booth School of Business.
„In the short-term, it seems weird.“ But in the long term, could it work?
Mr Musk’s takeover of Twitter last year has been punishing for the social media platform.
Advertising revenue has dropped by half, Mr Musk said this month, as big brands pulled back, wary of changes he has made, including how the firm handles verified accounts and moderates content. Abrupt layoffs and unpaid bills have also led to bad press and lawsuits.
Estimates by Fidelity, which has a stake in the company, suggest it is now worth just a third of the $44bn ($34.3bn) that Mr Musk paid for Twitter in October.
Consultancy Brand Finance recently estimated that the firm’s brand was worth $3.9bn, down 32% since last year – a fall it attributed to Mr Musk’s „aggressive business approaches“.
Research suggests that rebrands can pay off – particularly if a firm is in trouble or wants to change direction, said Yanhui Zhao, a professor of marketing at the University of Nebraska Omaha.
