Business lessons from the rise and decline of Threads app

Last month, Meta – the parent company of social media platforms like Facebook, Instagram and WhatsApp – added a new social network app to its rich portfolio, Threads. The new platform recorded remarkable success on its first day and rose to become the first social media network to register a million subscribers within the shortest time possible. Recently, according to data tracker reports, Threads is witnessing fewer daily users after generating so much interest in the first few days of installment. Here are a few business lessons that can be gleaned from the sharp rise and decline of the Threads app.

Don’t be fooled by the hype
When a company is about to launch a new product in the market, there's always hype surrounding it. Everyone will want to experience it, especially if it is innovative or promises to be an industry disruptor.

But, what if the hype that accompanies the launch doesn’t last? Threads has taught us that just because customers beat a path to your store door after the launch doesn't mean you should prepare for large profits. Building a brand and customer base takes time. Remember, the customers may have been enticed by low pricing compared to what the competition is offering for the same. And after sampling what you have to offer, you may never see them again. It’s not a surprise that many quickly realised that, at the end of the day, X or formerly Twitter, remains king.

Keep your intentions pure
X CEO threatened to sue Meta, and those who were keen may have observed that Threads had features mimicking X interface. If you think you can model your business on that of an existing one with hopes of dislodging it from the market, and 'inheriting' its customer base, think again. By doing this, you will be confirming that you are not in market to address a need or fill a gap, but to compete with an already established market leader.

Things might get even worse if you employ unethical means to drive the established ‘rival’ out of the market. Locally, there are many examples of entities that went down this route, with no success. Who remembers G-TV and Kwese TV, broadcasters from Southern Africa who exited the market shortly after launching as rivals of DStv, leaving customers with unusable decoders? The same thing happened with South Africa's Castle beer. When former US president Donald Trump launched his Truth Social, an app designed to offer alternative news from what mainstream media reports, how far did it go?

Be creative or original
Don't try to copy and paste another person's business model because you want to tap into their success. Doing that will mean you have nothing new to offer. Do you know their journey? What did they go through to be where they are today? It pays to be creative and original in everything. You never know, taking that less trodden path could lead you to unique success. It is common in a market, that when someone finds success in snail business, five others will establish a similar entity to try and tap on the former’s customers. Instead of trying your hand in the same business with the intention of competing, think of something else that can supplement the successful business you have identified.

Focus on building loyalty 
When that hype after product or service launch is over, how do you know you have a reliable client base? Do you have what it takes to attract and retain customers, and to build loyalty among them? Take the example of local telco companies. Telkom Kenya would perhaps be the market leader today in telephone services, but its failure to innovate when mobile phones made an entry in the market cost them. While the company was sticking to pay phone booths as its core business strategy, new entrants came with better strategies and the rest is history. The question to ask is, how will you attract and maintain customers with your product or service? Building a brand from scratch is not easy, and neither is establishing customer loyalty. But it is possible.

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