Twitter superapp? Here's why it makes sense
Elon is controversial. His strategy isn't — and it could create the very first web3 superapp.
Hello there! Welcome to my eclectic newsletter. My name is Ev, and I blog about technology and product with a dash of strategy and a pinch of trends.
In today’s issue: a quick (and speculative) take on why Elon Musk’s idea of the X superapp has legs.
Elon Musk’s words raised eyebrows when he shared a plan to turn Twitter into a foundation for his upcoming super app called X. US tech media responded with skepticism, arguing that the Asia-native super app strategy doesn’t fit the existing behavioral patterns of North American users.
The problem is, such thinking assumes Musk is betting on building a product for North American users. My contrarian take is that it’s not the case. Let’s break down why this might be so.
Demographics & Growth
First off, demographics. As of 2022, over 30% of Twitter users are based in the fast growing internet markets of Southeast Asia and Latin America. There, the comparatively young internet natives use superapps daily. (Source: Statista) The precedents set by Grab, GoJek Rappi and others proves that the superapp model works in those regions and could support large and profitable consumer platforms.
Speaking of growth dynamics, Twitter’s user base in Asia Pacific and Latin America grew 3% and 1% respectively in 2022 — compared to a -0.5% contraction in North America (source). The biggest takeaway from this is that Twitter is growing the fastest in regions where it could earn the lowest ad revenue per user. Considering the economic and privacy headwinds, effective monetization of this user base is only possible by tapping into direct P2P transactions and value creation, such as social commerce and payments.
User Generated Content
Leveraging Twitter, X will have what Grab and others were never able to create: the social layer powered by user-generated content. UGC offers one of the best ways to grow engagement within the product, thus creating growth loops that other super apps have to fuel through other means.
The best industry example of this is WeChat, and the second best is the Facebook Blue App which used the superapp patterns to introduce elements of social commerce and payments.
Here, Twitter’s performance in APAC and LatAm is also superior. For instance, its monthly time on site in Indonesia was 37% above the average time on site worldwide (source).
Outlier behaviors & experimental features
Some outlier behaviors of Twitter users already follow patterns that could be translated into a superapp design. Many of those behaviors are supported by the experimental features that Twitter rolled out over the past two years. What’s even more interesting is how widespread those behaviors and features are among the crypto-native crowd.
For instance, ENS domains have become extremely popular on Twitter. Used instead of names, they signal that — among many other things — a user accepts crypto. This behavior indicates a potential opportunity for crypto remittances embedded directly into Twitter. Twitter tips could provide infrastructure on-ramps for that.
Will X become a web3 superapp?
Earlier this year I made a case for web3 superapps, and my speculative hunch is that Twitter-powered X very well might become one of the most exciting consumer web3 projects of the decade. Musk is crazy enough to bet on consumer crypto, and if we look beyond the facade of weirdness, his ideas for Twitter — at least those discussed publicly — all point toward it becoming a massive ecosystem product.
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