By Adam Fraser
Interesting times for the golden boy of social media Snapchat.
The new kid on the block has enjoyed rapid growth via a very targeted millennial audience – quickly becoming the cool nightclub that your parents don’t hang out in.
Facebook recognised its potential a while back, rumoured to have bid $3bn to acquire Snapchat in 2014. Founder Evan Spiegel chose to go it alone, a move which seems to have paid off financially with the recent lodgment of a prospectus to IPO at a market cap of rumoured to be around $25bn.
However the competitive environment is adding significant pressure to Snapchat’s user growth and engagement levels. In particular Instagram launching its own Stories product has allowed its user base to enjoy many of the features embedded in Snapchat without actually having to up roots and move over to the platform.
A piece in TechCrunch details a number of anecdotal stories from agencies and influencers about the material decline in views and engagement on Snapchat since Instagram launched its Stories product in August 2016. Imitation is flattery – there really isn’t a lot of difference between the 2 products and Instagram has seen great success since it’s release of this feature.
With Facebook messenger also adding (imitating) features that began on Snapchat the walls are closing in somewhat on Snapchat’s various points of difference.
In light of this it’s perhaps no surprise to see Snap inc (not Snapchat) that has registered for an IPO. Labeled a camera company pursuant to its recent Spectacles release, is Snapchat preparing to pivot into any or all of branded products, AR and VR?
Given the fickle nature of social media users this may be no bad thing. Still a social media messaging platform at its core, Snapchat is clearly backing a few different horses to deliver growth as a listed company.