Supposedly Snapchat’s CEO Said Snapchat Isn’t for “Poor Countries” (Like India and Spain)?

My Thoughts: Maybe I’m naive, but I seriously doubt these allegations. And even Spiegel did say this, it was years ago and he was really not much more than a kid (hell, he’s only 26 now).

Let’s stop crucifying people for mistakes they made in the past. And even moreso, let’s stop rounding up our mobs around what at the very most is unsubstantiated hearsay.

I don’t know if the guy said it or not. If he did, it was dumb – but it’s not like it’s a representation of the company itself. He’s entitled to his own opinion, as stupid as it might be.

Besides, if Spiegel really is an idiot like these allegations would allude to, chances are he’ll make a more public mistake soon enough.

Snapchat maker Snap Inc. is denying that its CEO, Evan Spiegel, once said the app was “only for rich people” and he didn’t “want to expand into poor countries like India and Spain.”

Source: Snapchat denies CEO said app was ‘only for rich people’ and not India – Business Insider

Teens Are Leaving Smaller Social Networks – Moving Primarily to Snapchat and Instagram

My Thoughts: It was only a matter of time before more of the social networks died off and even teens started to congregate amongst the larger ones. While it’s true that teens like to be “rebellious” and go places where the “grownups aren’t,” they also do want to be where others are – as a social network isn’t worth much when there aren’t any other users on it.

It’s kind of like eBay in that regard – sure, other auction sites can and do exist, but if you want to be in engaging with the most people, you go where they people are. Plus, as these larger networks continue to drive user growth and revenue they are able to reinvest that capital into the network platforms themselves, making them much more valuable of destinations for the users.

Today’s social networks are a far cry from the scrappy startups they were just a decade ago. Today they are multi-billion-dollar companies with massive R&D and marketing budgets, which are in turn causing the smaller networks to be less attractive. After all, who wants to invest their efforts into maintaining a presence on a social network that has less features and fewer users – especially when all the coolest features just get copied by the big guys eventually anyway?

Teens are consolidating their social network activity around four main social networks: Snapchat, Instagram, Twitter, and Facebook and have stopped using smaller ones such as Kik or Tumblr, according to a new survey from investment bank PiperJaffray.

Source: Teens are dropping smaller social networks in favor of Snapchat and Instagram | Business Insider India

Snapchat Users Are Very Likely to Watch a Brand’s Entire Story, Report Shows – Adweek

My Thoughts:

Seriously? An 88% completion rate on brand story video? That’s ridiculously high – and even more proof that SnapChat is turning into the place to be for digital marketing and storytelling.

I’ll have to dig in to this more. The issue I always have with SnapChat is the difficulty in discoverability. Might be time to dive back in and see how things have changed.

When Snapchat users viewed a brand’s story, they watched the entire story nearly 88 percent of the time.

Source: Snapchat Users Are Very Likely to Watch a Brand’s Entire Story, Report Shows – Adweek

Snapchat’s Biggest Risk Is Ingrained in Its DNA

Earlier today I was talking to a colleague about valuations (and overvaluations) of a lot of tech companies, and in particular how the “get users at any cost” model appears to finally be showing some cracks (which make sense, since the whole concept of monetization has never been realized by most of them). Naturally, discussion veered to some of the hotter platforms out there now, including Snapchat.

I’ve been using Snapchat myself for a month or two now, after seeing my wife become addicted to it a few months earlier and finally giving in to see what all the fuss is about. My colleague has used it in passing, but it hasn’t caught on for him. Given that we’re not the demographic who’s using Snapchat the most, we turned our discussion away from “why is this popular?” to the more pressing question: “why is this worth so much, and how do they ever plan to make this profitable?”

Of course, Snapchat has been rolling out quite a few features lately that can bring in money – the most promising of which I think is their sponsored filters/effects. So they’ve got their eye on profitability, or at least some sort of revenue stream – and they’re doing it in ways that actually make sense as part of the platform rather than just sticking ads into people’s streams – but this brought up a much more important question. Is the lack of advertising and the lower usage of Snapchat by the “older” demographics part of the reason for its popularity? Is Snapchat so popular with the younger demographic due in part to the fact that they feel its a kind of club of their own?

If that’s the case, it’s entirely possible that as advertising and monetization move in, and as Snapchat becomes used by all the “grown ups” out there, the current large userbase might bail. It’s also possible that they will stick with the platform due to the inertia they’ve made in it, much like how Facebook users have stuck with Facebook as they’ve gotten older. In other words, Snapchat may not always be popular with the “younger” demo, but instead that younger demo may become accustomed to having Snapchat as part of their lives and its usage demographics will shift as the users shift. Same user group, different demographics over time.

The problem with this though is that Snapchat has a very serious risk that is built directly into the DNA of the product. By its very nature of “auto-deleting” posts after view, or even only having rolling windows of 24 hours for stories, Snapchat’s value only lies in the current space in time in which it exists. Over the course of a year, someone may engage with the platform thousands of times, but none of that has any historical record or value. Basically because you can’t go back and see what you did six months ago, your investment into Snapchat holds no value to you.

This is where platforms like Facebook have built up such resilience to customers simply abandoning the platform. With Facebook you have a historical record, like a virtual scrapbook, that you can go back in time and view. Throughout the time you’ve spent interacting and sharing you’ve built up a history that includes major amounts of data and information, all of which you would in essence “give up” if you were to abandon Facebook. Instagram is similar with its photo timelines, and Twitter with your tweet history. Snapchat has nothing of the sort. Yes you might build up a bunch of connections, but those are easily transported to a new service.

A good comparison from an e-commerce / tech perspective would be to think of switching analytics providers. If you’ve spent the last 10 years gathering your data into Adobe/SiteCatalyst, you have a lot of information (a vested interest) in the platform. Even if Google Analytics is better and cheaper, the cost of switching is huge because you lose all the information you have stored there (ignoring data exports, of course). The point is, all that data and historical interaction is of great value. An analytics platform that only told you what happened in the last 24 hours would be susceptible to major churn when something else hot comes along – and Snapchat is in the same boat here.

I don’t think Snapchat is anywhere near the end of its days – in fact I think it still has a lot of room for growth. But there’s a big risk built in to the way they work that makes them much more at risk than any other major platform in memory in that they have really no investments from their users that can be leveraged for continued brand loyalty.

The good thing is that with this risk, they will be required to continually innovate to keep users engaged. But once the new hotness comes into town, the exodus could be like nothing we’ve seen before (even counting the death of MySpace).