Musk, Trump, Twitter, and New Media Math
Looking at the Tesla CEO’s offer to buy Twitter through the lens of AQ (Attention Quotient) makes his real motives clear.
Before we get to today's main topic, some miscellaneous goodies...
PBS News Hour profiled the incredible young guitarist Yasmin Williams. I’ve been happily streaming her music ever since.
I love the Muppets! Here’s a 1970s snippet featuring Jim Henson and Frank Oz improvising as Kermit and Fozzie.
You’ll need a snack to keep your blood sugar up while reading, but don’t miss Benjamin Wofford’s epic profile of Joel Kaplan, Facebook’s head of policy, in the latest Wired. (subscription required)
Adam West once described this sequence from the 1960s Batman movie as “an aria of frustration.” Cracks me up every time.
This week’s Bradism: You’ll get more done if you don’t care about getting credit.
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On to our top story...
Musk, Trump, Twitter, and New Media Math
It’s a good thing for the commonwealth that Elon Musk was born in South Africa; that fact bars him from seeking the U.S. presidency. Otherwise, it’s a sure bet that he’d run as a third party candidate in 2024. He’d win, too. Musk understands the media better than all but one other person.
That one other person is Donald Trump.
Don’t get me wrong: I am not a Trump fan. I loathe the man and think that he was the worst president in the history of this great country. But I recognize that Trump is the greatest marketer the world has seen since the early Catholic Church (in its world domination days before the Protestant breakaways).
Musk is a better person than Trump across nearly all criteria:
Trump inflates his net worth (he’s a fake billionaire); Musk is the world’s richest individual
Trump’s products are terrible and fail; Musk makes best-in-class products (disclosure: I drive a Tesla 3; it’s the greatest car I’ve ever had)
Trump makes the world smaller and worse; Musk creates technologies that make the world bigger and better, even planning to take humanity to Mars
Trump famously doesn’t read; Musk reads voraciously
Where the two men are the same is when it comes to playing the media like Joshua Bell plays his Stradivarius: they are virtuosos.
In a column a few years ago, I posited a new metric for attention called AQ for Attention Quotient.
If IQ (Intelligence Quotient) measures raw intellect and EQ (Emotional Intelligence) measures self-awareness and empathy, then AQ measures how much raw attention an individual can pull towards him or herself.
Most people measuring attention act like pollsters, weighing both positive and negative attention, then seeing on which side there’s more. If there’s a net positive, that’s good. Net negative is bad. A score of 15 positive and 10 negative equals five positive.
Both Trump and Musk understand that such an approach to attention is nonsense. Attention is attention. 15 positive and 10 negative equals 25 units of attention. The sheer amount of attention is more important than the valence of any individual unit of attention.
Musk is neither a narcissist nor an adolescent.
Recently, a wrongheaded meme has been circulating that I think of as the “that crazy Elon” story. On the Pivot Podcast (my favorite) Scott Galloway frequently talks about Musk as an adolescent with a pathological need to be in the news every 48 hours. A Thursday Atlantic article by Renée DiResta, “Elon Musk Is Fighting for Attention, Not Free Speech,” describes Musk as an internet troll. This is wildly wrong.
Musk is not an attention whore. He is not a narcissist. He is not a troll.
He’s merely shameless. Or, if he does experience shame then—after years in the public eye and what was already a high degree of eccentricity—he doesn’t experience shame like a typical human. This is a man, after all, who named one of his children “X AE A-XII.”
To paraphrase Oscar Wilde, if you are shameless, then you don’t care what people are saying about you, only that people are saying something about you.
But why does Musk want people talking about him? It’s not about Twitter.
Musk does not want to own Twitter.
Musk made sure his ownership stake in Twitter stayed below the 10% threshold where he would have to follow a more stringent set of disclosure rules. He declined a board seat because the fiduciary rules of board membership would have constrained his ability to Tweet freely.
His $54.20 per share first and final offer was smack in the middle of Twitter’s 52 week range of $31.30 to $73.34, so investors were guaranteed not to take it seriously. There was no premium.
By making a bad offer (which he probably can’t afford anyway) this week, after refusing a board seat last week, after revealing his stake in Twitter the week before, Musk managed to dominate the business news cycle for the last three weeks. Again, why does Musk want people talking about him?
He wants to sell more cars.
The timing of Musk’s great Twitter flirtation isn’t an accident.
Tesla’s lead as the most successful luxury EV brand is big, but it’s starting to atrophy. The Cadillac Lyriq is nearly here: dealers will take orders in less than a month, and the car started production ahead of schedule.
Meanwhile, Elon Musk has Hoovered up a ton of attention that benefits his luxury EV brand.
Outside of the Lyriq, if you search “luxury EV” you’ll quickly find a number of alluring non-Tesla models already available, with dozens more coming soon.
Where Tesla was previously one of a kind, it is now one member of a large consideration set. Tesla now has to compete in a new way.
In How Brands Grow, marketing professor Byron Sharp argues that brand growth is driven by two simple things: salience (how thinkable a brand is) and ability to purchase.
Just by flirting with an acquisition of Twitter, Musk has made Tesla much more thinkable. He earned hundreds of millions—possibly billions—of dollars in free media, getting coverage from all the major media companies and a seemingly infinite number of tweeters and bloggers.
Meanwhile, Musk’s yes-but-then-no offer has put Twitter into play for acquisition by somebody else, which would make his stake in Twitter more valuable, so he’ll earn money from the exercise.
That isn’t narcissism. It’s good, strategic business.
Thanks for reading. See you next Sunday.
Brad, agree with one possible small twist/addition to your theory: what if Musk understood his customer and the car buying demographics. Let's assume he's wrapped up the primary target market for luxury EV cars. He most likely has pricing leverage vs competitors, and he's launching a truck. Where are his new customers going to come from? Remember when MAGA crowd was blocking access to EV stations? Remember when they were keying Teslas? Strong possibility he knows if he can curry favor with the 50% of this country who previously hated him, he can compete on price, and he's got pickup trucks to sell, MAGA is the most lucrative market for Tesla the next 10 years. AND, by nature of the way in which he's doing it, he jumps from last to first place with this crowd. Before the shtick, 0% chance they're ever buying a Tesla EV. Now, I'd say Tesla would he their #1 choice. Not to mention, at the moment, he's got 0% penetration so if they start buying, he wins and becomes even wealthier.