Why I was wrong about Snapchat being dead
The following is not meant to be investment advice.
A few weeks ago, I logged into Snapchat. It was my first time in two years. I used to really like the app back when I was in high school and early college, but I stopped using all my social media accounts back in 2018. I got back on most of them a few months ago, but I didn’t really see the point of Snapchat anymore. I used to use Snapchat Stories a lot, but now I could do the same thing on Instagram.
I decided to give Snapchat another shot just out of curiosity. For a few minutes after I redownloaded the app, I regretted the decision. The app’s user interface looks terrible. I also noticed that fewer people were posting Stories than 2 years ago and that some of my friends stopped using the app entirely.
But after a few hours, I remembered why I liked Snapchat so much in the first place. Sending photos and videos are a great way to connect with people. Even if you’re staying socially distanced, you can still feel like you’re in touch with your friends.
I’m definitely not the only person who’s using Snapchat to stay connected. Even though their app looks like shit, the company’s been doing pretty well recently. In the past year, Snap Inc’s stock price went from $15 to $39. It’s a big change considering Snapchat looked like it was in trouble two years ago.
Why it looked like Snapchat might die
Back in 2013, Mark Zuckerberg realized that Snapchat was a threat to Facebook. So he tried to buy the company for $3 billion. When Snapchat’s founders declined the offer, Zuckerberg decided that he would instead destroy them by copying their best features.
Facebook first tried releasing a couple of different standalone apps that were pretty much Snapchat clones. Both of them failed pretty quickly. Facebook then tried experimenting with disappearing posts and profile pictures, which nobody used in beta tests. But Mark Zuckerberg didn’t become a billionaire by feeling normal human emotions like shame, so he kept going.
Finally, the company decided to introduce Instagram Stories, a blatant ripoff of Snapchat Stories. This time, the plagiarism actually worked out really well for them. By 2019, 500 million people were using Instagram Stories daily, which at the time was more than double the number of people who were using Snapchat daily.
On top of losing users to Instagram, Snapchat had a really unpopular app redesign in 2018. Snapchat CEO Evan Spiegel decided to put stories from users and stories from brands in two separate places. Most people found this confusing. As a result, Snapchat actually lost users that year.
It looked like Mark Zuckerberg had Snapchat in a chokehold. When a social media company stops being cool, it can die pretty quickly just like YikYak or Myspace. If Snapchat wanted to stay alive, it needed to make moves fast.
How Snapchat stayed alive
When it saw users leaving, Snapchat rolled back their redesign and put brand and user stories back in the same place. The company also decided to invest in what it’s best at.
Usually, your Snapchat friend list is made up of the people you’re close to, while Instagram is pretty much all the people you’ve ever met. That means that there’s more room to be your real self instead of feeling the need to flex.
Like I mentioned at the beginning of this article, I really don’t think any other social platform keeps you connected with your real friends the way that Snapchat does. If you’re all in different places, seeing what your friends are doing through a video makes you feel like you’re actually with them for a few seconds. That’s a big deal in a time like this when people are struggling with loneliness.
In the past couple of years, Snapchat has invested heavily in mobile games like Bitmoji Tennis that you can play with a group. The company also introduced filters like “gender swap” which allowed you to show your friends what you would look like as the opposite gender. As a result of these changes, Snapchat’s user base started growing again, going from 190 million Daily Active Users at the start of 2019 to almost 250 million Daily Active users today.
How Snapchat got more ad money
Snapchat has also taken some big steps forward in offering advertisements to businesses. Last quarter, Snapchat made $678 million in revenue, up from $446 million a year earlier. While it’s still not a lot when compared to Facebook, it’s great for an app that looked like it was dying less than two years ago.
While marketers might reach more people with Facebook and Instagram, Snapchat’s ad offerings can help them engage possible customers in interesting ways. If you’re a small business looking to promote your store on Snapchat, you can use a location-based geofilter. If you’re a big brand looking to raise awareness, you can reach users with a custom lens. And if you’re too lazy to figure out how to do either of those things, you can just put up an image that promotes your business and make it a Snapchat Story ad.
There’s another factor that’s helped Snapchat’s ad business in the past few months. Recently, lots of big brands like Coca-Cola and HP have boycotted Facebook over civil rights issues. Many of these companies chose to spend their marketing budgets on Snapchat ads instead. With more and more controversy surrounding Facebook as we get closer to the election, we might see even more companies choose to go Snapchat.
In conclusion
I still think Snapchat’s user interface looks absolutely disgusting, but I guess the stock price proves that it really doesn’t matter. Say what you want about the app, it’s still a great way to connect with people during quarantine, and advertisers are starting to recognize that.
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Originally published at https://sundayspecial.substack.com.
