Snapchat is throwing a bunch of changes at the wall, hoping one will be stick and help the company attract new users.
The social media platform has seen stagnant user growth, and execs have watched as Instagram and Facebook have copied some of its most popular features. Now the platform is working with other apps, adding video games and augmented reality features and a new ad network to convince investors and consumers alike the brand has staying power.
The announcements were made at Snap’s recent “partner summit,” the first of what the company says will be an annual gathering.
Snap made a slew of announcements, including a new ad-supported gaming platform, at its first partner summit Thursday as it casts a wider net for ad revenue. Although the announcements also included a new ad network, advertisers say the real compelling opportunity is in gaming.
Snap has proven popular with its young audience. Onstage Thursday, CEO Evan Spiegel claimed the company reaches 90 percent of 13-to-24-year-olds in the U.S. But what has been less clear is how Snap’s revenue will grow as its audience growth has sputtered.
One way is trying to get its users to use the app even more, which gaming should help with if executed right. The mobile games market was expected to hit $63.2 billion in 2018, according to research from gaming, esports and mobile market analytics firm Newzoo. Snap’s market cap had risen by about $600 million Friday to about $15.5 billion.
Analysts say the changes are aimed at convincing users and advertisers that the app has a broader appeal.
So what’s the motivation behind building these features? Well, Snap clearly wants you to open its app more often; and it’s trying to trick you into doing that by letting you use its new camera functionalities for anything and everything you see.
But if you’re deep into the Instagram story world, it’s unlikely that you’ll use Snapchat for just these functions. Besides, Instagram’s already testing its own set of new AR-based features.
The changes suggest the platform’s executives are rethinking its basic brand position.
The Next Web continued:
These new features indicate that Snapchat’s gradually moving away from its ‘camera company’ ethos, and indulging more into content play. Also, as TechCrunch noted last night, it’s sharing notable functions like stories and lenses with other apps to stop copycats from springing up – something that’s played a huge part in stagnating Snapchat‘s growth in past few years.
In its Q4 2018 quarterly report published in February, Snapchat announced that its Daily Active Users (DAUs) were stable at 186 million – same as it’s Q3 userbase. As per a study published by Piper Jaffray last year, Snapchat‘s even lost the first place as an app of choice amongst teens in the US to Instagram.
With its plateaued userbase in the US, the company’s shifted focus towards India where they’ve launched localized Discover section in four languages, and partnered with cricket teams to draw more people to the app.
Marketers hope the changes indicate the Snapchat brass has finally figured out its niche.
The day before Snap’s Partner Summit on April 4, a Snap exec said that the company’s hope is that the event would provide a more cohesive vision of what the company is. And it appears to have worked. After hearing that Snap is introducing an in-app gaming platform and new augmented reality features to Snapchat, agency execs came away from the event feeling like they had a better grasp of how the app differentiates from other social platforms. “Snapchat is really about fun more so than any other platform or competitor. They’ve figured it out,” said Noah King, svp and group director at Socialyse.
“They’re starting to put together the story of who they are more so than before. It’s about the camera and creativity. That has been a narrative that wasn’t for me as solidified before. When we’re talking to clients about platforms, we need that soundbite,” said Meghan Myszkowski, vp and head of social activation for North America at Essence.
Many marketers note the continued difficulty of selling Snapchat to clients. The platform has stiff competition and faces a lot of work to find new ground for attracting users and advertisers.
Being able to reframe advertisers’ perceptions is important given Google’s and Facebook’s continued dominance of digital advertising and advertisers’ burgeoning interest in other social platforms like TikTok, Reddit and Pinterest. Additionally, if Snap is able to not only grow its business with existing advertisers but also attract new ones, that would give the company the type of broad advertiser base that has helped Facebook’s and YouTube’s advertising businesses to weather the storms surrounding their products.
Snap’s advertising business has been somewhat mired in advertisers’ struggles to understand the app, given that middle-aged marketing executives are not exactly Snapchat’s audience. “Every brand I work with goes, ‘What is Snapchat?’ They don’t get it because they’re not on it. That’s the biggest hurdle for more brands to get on it,” said one agency exec who asked to remain anonymous.
Some marketers think the changes offer promise.
Allowing people to cross-post their Snapchat Stories to apps like Tinder and Houseparty could be a way for Snapchat to bring new or former users into the fold. “It is an opportunity to advertise the platform and have people say, ‘That’s cool content. I want to come back to Snap, or I want to open an account for the first time,” said James Chanter, senior partner at GroupM’s m/SIX.
Similarly, Snap Audience Network could extend Snap’s addressable audience beyond the 186 million people that use Snapchat daily to include less frequent users who may be found in other apps. “Snap does appear on our media plans where relevant and where we want to reach a specific audience. But what Audience Network does is it has a potential to blow that out,” said Chanter.
Snapchat’s new strategy also is intended to preempt copycats.
But Snapchat’s new strategy is a rallying call for the rest of the social web that’s scared of being squashed beneath Facebook’s boot. It rearranges the adage of “if you can’t beat them, join them” into “to beat them, join us”. As a unified front, Snap’s partners get the infrastructure they need to focus on what differentiates them, while Snapchat gains the reach and entrenchment necessary to weather the war.
Snapchat’s plan is to let other apps embed the best parts of it rather than building their own half-rate copies.
Why reinvent the wheel of Stories, Bitmoji, and ads when you can reuse the original? A high-ranking Snap executive told me on background that this is indeed the strategy. If it’s going to invent these products, and others want something similar, it’s smarter to enable and partly control the Snapchatification than to try to ignore it. Otherwise, Facebook might be the one to platform-tize what Snap inspired everyone to want.
What do you think of Snapchat’s latest changes, PR Daily readers? How will you be using the platform in the coming year?