Snap Inc.’s post IPO success has been almost non-existent, but its latest earnings report changed a lot of that. An Android app redesign, a methodical reversal of a botched 2018 redesign, an emphasis on AR has led Snap’s share price to actually double in 2019.
All of those changes certainly helped Snap in its rebound, but none of that would have been successful without its users, especially teens. Snap now reaches “90% of all 13 to 24-year-olds and 75% of all 13 to 34-year-olds in the U.S.,” and according to Snap that’s more than even Instagram can claim. That number paired with a greater emphasis on making its advertising platform more sophisticated have made Snapchat a more attractive place for advertisers.
That’s where Snapchat’s success is coming from, but is that enough for the platform’s future?
2019 needs to be a big year for Snap, Inc. The company was once on the tip of every marketer’s tongue as the next big thing, but it’s had trouble since its IPO in shaking its user growth struggles. While Snap hasn’t been losing users on its core Snapchat platform, it hasn’t been able to grow users either. Its Q4 2018 earnings showed flat growth overall, which has led to the widespread notion that Snapchat isn’t the place to reach an audience. Instead, marketers are shifting their focus, time and efforts to other, larger players like Facebook and Google.
Last week, Snap worked to retake the narrative and establish a vision for its future at its first-ever Partner Summit, an event for developers, advertisers and content creators to see just what Snap has in store. Overall, Snap’s approach could be bucketed into two key areas: remove the necessity of users for scale and maintain camera leadership.
2018 was one PR black mark for Facebook after another, but at the end of the day, Facebook always delivered financially. Snap was a different story. Ever since going public, Snap has yet to have its Wall Street turnaround moment—a moment that Twitter has only just started to have.
The challenge Snap has that Twitter didn’t have to deal with, directly at least, as much is Facebook. Snap is in Facebook’s crosshairs as it looks to duplicate every feature that makes Snapchat unique from filters to Stories. There is no stone left unturned in Facebook’s efforts to borrow and steal from Snapchat’s playbook. Maybe Snap should be flattered. Through it all, the one thing Snapchat’s done well is it’s played its own game. While Facebook copies them, they innovate and differentiate their platform from everyone else’s.
Still, if Snap wants to make 2019 a very different year from a performance perspective, it needs to focus on three things: 1.) quickly expanding its user base, 2.) deciding who it wants its audience to be and 3.) appealing to advertiser’s hearts as much as their heads.
Snap has certainly made a name for itself as a camera company, but its latest push in the marketplace is all about commerce as the company looks to give advertisers more ways to use Snapchat to drive online purchases.
Snapchat’s had its share of troubles as of late. User growth has slowed. A botched rollout of an app redesign was met by frustration from its users. It's had to play catch-up in offering ad targeting and measurement solutions quickly, meaning it had months to figure out what competitors have taken years to.
The road for Snapchat has not been easy, and there’s little reason to think that will change.
But the picture for Snapchat is not dire. Snapchat has the one thing Facebook is dying to have. Cool factor. And that cool factor comes from Snapchat’s users—teens.
Snapchat came onto the scene with a promise to do things differently. It aimed to deliver users a platform that valued privacy above all else, and it aimed to offer a a service that wasn’t just another broadcasting platform feeding users content. Snapchat would instead be a messaging platform, focused on interactions between friends that disappear because after all, that’s how interactions IRL work.
It was a product welcomed by its users. It respected them, and it put users first like no one else had up until that point.
So what happened?