Advertisers interested in US super app — don’t expect it from X

With Twitter’s rebranding into X, Elon Musk has taken the first step towards creating his long-envisioned super app — but global advertising experts with knowledge of Asia’s super apps are dubious the erratic leader can emulate the model.

Super apps essentially offer one platform for users to access several utilities. Gartner describes a super app as having “a range of component tools (miniapps) that the user can use and remove as needed.”

Musk has toyed with the idea of creating a super app under the domain X.com since 1999, when he launched an online bank using the URL designed to be a one-stop-shop for all financial needs, according to insights shared by Walter Isaacson, who has written a book on Musk.

Back in October, Musk stated that “buying Twitter is an accelerant to creating X, the everything app,” though it wasn’t clear at the time whether Twitter would form the bedrock of X or be folded into a broader offering. Now that X is alive and Musk and CEO Linda Yaccarino have resurrected the super app narrative, advertisers are interested, but skeptical, in seeing if X can do what’s never been done before by bringing a super app to the U.S.

The WeChat model

A leaked transcript of Musk’s first meeting with Twitter employees hints at his vision to emulate WeChat’s model in China.  

“You basically live on WeChat in China because it’s so useful and so helpful to your daily life, and I think if we could achieve that — or even come close to that with Twitter — it would be an immense success,” he said.

WeChat started out as a messaging platform similar to Meta’s WhatsApp but since its launch in 2011 has baked in a range of other services that allow users to make payments, access banking and e-commerce, order groceries and rides and play games. Owned by Tencent, China’s second-largest company, WeChat has more than 1.3 billion monthly active users.

X isn’t the first social media company to try to mirror WeChat’s success in the U.S. by stuffing as many features as possible into one app. Meta has payment options on Messenger, TikTok is looking to launch an e-commerce business and Snap released “Minis,” which are third-party apps that run inside Snapchat, back in 2020. 

With so many others trying and yet to succeed, advertisers are even more skeptical that X is the one to get it done.

It’s not Musk’s style

Bringing a super app like WeChat, with its reliance on users’ personal information for payments and commerce, to the U.S. requires years of planning and partnerships to comply with data privacy laws and antitrust measures, said Tom Morton, global chief strategy officer at R/GA.

“The lingering question is whether there’s a genuine, thought-out and operationalized plan,” he said. “The order in which this [X rebranding] has happened seems to be more capricious than thought out. Usually, there would be a conversation with partners and advertisers — there would be some product news wrapped in a rebranding.”

Given that police stopped X’s removal of the old Twitter logo on its San Francisco headquarters on Monday for failing to communicate its plans with security and the building’s owner, Morton added that he hasn’t yet seen the level of foresight a U.S. super app would require from X leadership.

Questions also quickly emerged over whether X had the legal right to use its new logo, which Musk crowdsourced from the community a day before going live with it.

Monotype, a font company that has an “X” very similar to the logo in one of its alphabet libraries, has since confirmed that the logo is different enough that Musk would not need to purchase a license to use it. Meta and Microsoft also have trademarked “X” logos related to their gaming businesses that don’t conflict with X as a social media company.

Even if legally cleared, the name “X” throws up a slew of other branding and SEO challenges that could inhibit its growth plans.

Twitter’s legacy

Building a U.S. WeChat equivalent will also be an “uphill struggle” for X given that users fundamentally use it as a conversational platform where “the magic was in the flow of ideas,” Morton said.

Musk himself has recognized the disconnect between what users look for in Twitter and what his super app could offer.

“The Twitter name does not make sense in that context, so we must bid adieu to the bird,” he posted on Monday.

Some social media users have questioned why Musk didn’t start X from scratch, to which he replied “Twitter probably accelerates X by 3 to 5 years, but I could be wrong.”

X has a long road ahead to becoming a super app, said Kasha Cacy, chief media officer at Known.

“They’re going to have to demonstrate that they have a scale of users across these new capabilities that is meaningful enough to invest dollars against,” she said. “Then they have to figure out what the advertising opportunities against those audiences are.”

Before any of that happens, X needs to demonstrate that it has addressed brand safety issues that have tarnished its relationship with advertisers over the past nine months. 

“The brands I’m working with don’t feel comfortable with the content they’re going to be surrounded by,” Cacy said. “They have to fix that problem…an ad model for new capabilities is pretty far down the road because first they have to get the platform to be brand suitable.”

On Wednesday, Musk tweeted that X was reinstating an account banned “for posting child exploitation photos.”

Only people on our CSE team have seen those pictures. For now, we will delete those posts and reinstate the account.

— Elon Musk (@elonmusk) July 26, 2023

According to the Wall Street Journal, Yaccarino has advocated that Twitter rejoin Tech Coalition, an organization focused on fighting child sexual abuse online. Yaccarino approved the $40,000 annual dues to rejoin after Twitter let its membership expire.

Both Musk and Yaccarino have been vocal proponents of unfiltered free speech, which could conflict with their desire to replicate a highly censored app in WeChat, said Toni Box, SVP of social media at Assembly.

Advertisers are interested in a U.S. super app

Despite skepticism that X will be the first super app in the U.S., advertisers are interested enough in the possibilities of such an offering that they’d be willing to test Musk’s version should it come to fruition.

“A lot of the ad revenue around WeChat is around targeting people in very location-specific ways, and that could be interesting,” R/GA’s Morton said. “There’s a lot of commercial and creative potential with that. But you need the product to be up and running first. And you also need a lot of trust with the users — you need the product and behavior first in order to monetize.”

Assembly’s Box agreed the model is appealing to advertisers who are increasingly looking for rich data insights.

“If I were to put my advertiser hat on and think about the potential of data in a super app and all of the different consumer behavioral patterns they’d have access to…that’s gold for advertisers,” Box said. 

But success will depend upon X’s ability to grow adoption of its services. “My gut is that it’s going to be a bit of a hurdle to get past the effect Elon has had on advertisers and brands already,” she added.

Box added that there’s appeal in having access to data from multiple communities within one app.

“We’re always open to testing,” she said. “It would come down to the right client in the right category and what feels right for their audience.”

As a global agency, Assembly has some clients that rely heavily on WeChat for their marketing. One of its biggest takeaways from that experience is how critical influencers are to advertising on the platform.

“It’s not really that direct, one-to-one voice between brands and consumers, it’s really about leaning into those key opinion leaders,” Box said. “In China, quite often when people are searching for recommendations, they’re searching specifically for influencer recommendations.”

News often comes from those same figures, she added.

X recently rolled out its influencer monetization program to foster a bigger influencer presence, though many have noted that payouts favored influencers ranging from moderately conservative to far right, which hasn’t done much to appease brand safety concerns.