I know in the past two weeks everyone has been talking about Snapchat and the ways in which they are trying to introduce new ways to advertise on their platform. What interests me, however, is why Snapchat is fast-becoming the gold rush of the millennial age.
Yes. It is true that Snapchat, in terms of growth, are not doing so well. In fact, they missed their Q1 financial target by $158 million and took a net loss of more than $2.2 million. After the release of their Q2 financial report, you can see Snapchat has had another $2.6 million loss due to the failing of their shares. However, what was also interesting was that Snapchat reported an increase of 21% (173 million) in daily active users of their app, which is more than what Instagram can boast.
So the question is, if Snapchat users are increasing every quarter why are they dropping money like it’s hot?
Well, the answer is that Snapchat holds too much control over what advertisers and companies can do on their app – talk about Kim Jung Un. Snapchat is a great platform full of untapped potential and great in many ways to reach into the mindsets of users under 25. Since we spend more time on Snapchat than we do sitting on the toilet, this is the platform worth a lot of time and effort to the right company.
We are so easily influenced by what we see our friends doing, buying, eating, drinking that Snapchatters are 55% more likely to buy things we don’t actually need than non-Snapchatters (those who don’t snap on the daily). It is also where the “early-adopters” are highly concentrated, as the platform compromises of millennials who actively try new things for the sake of it.
When you take all these things into consideration, from a marketer’s perspective this is where the gold is. While Snapchat shouldn’t free up their control to let advertisers do whatever they want (#YOLO, is that still a thing?), they should, however, allow more freedom for content creation to companies. This young audience Snapchat possesses, marketers just can’t reach through TV advertising, Facebook ads and Instagram altogether.
If Snapchat is where it’s at, then shouldn’t we let the rest get in on it too? Or from a consumer point of view, are you done with ads altogether? Let me know your thoughts in the comments below!