With roughly 26 million users and a stronghold in the college-aged market, could Snapchat become the newest giant in mobile advertising? After rejecting multiple $3 billion offers from Facebook, we can only assume that the photo and video sharing application has something (profitable) up their sleeve. Well, advertisements can be a huge source of revenue, just ask Facebook, but should Snapchat follow suit?
Snapchat, which was released in September of 2011, has ballooned to roughly 26 million users. These users, who are mostly Millennials, exchange a total of approximately 400 million “Snaps” per day. In other words, this app could be the gateway to millions of eyeballs each day. What company wouldn’t love that type of exposure?
Additionally, Snapchat added a new feature which prolongs the life of a snap to 24 hours. Snapchat Story allows users to document the events of their day in a fluid photo-stream. These stories can be viewed an unlimited amount for 24 hours, after which they will disappear. This new venue for uploading snaps could be the answer for advertisers trying to circumvent Snapchat’s disappearing act.
Brands have already begun experimenting with both “traditional” snaps and Snapchat Story. Taco Bell recently sent followers a direct Snapchat message promoting their new product, the Beefy Crunch Burrito. McDonald’s took a different approach—posting a Story. It’s still too early to decide if either approach was truly successful.
Here’s the simple truth about Snapchat, its users find comfort in privacy. In a world where your Facebook and Twitter profiles can become factors in your job search, people—specifically young adults—are searching for a way to escape the spotlight. Employers cannot see the drunken Snaps you sent at 4am, or the scandalous videos that you “snapped” from the beach. Those are gone forever. But what does this mean for potential advertisers? Essentially it means that entering a forum championed for privacy could be supremely uncool. Advertisements on Snapchat would be like someone cracking open your diary and sharing it with the whole wide world. User’s sense of privacy would be compromised.
Advertisers should also be aware of a measurement problem. Facebook and Twitter have both implemented features which are measurable and traceable, figures that advertisers can point to in client meetings and cite. Tracking how many “Likes” or “Retweets” a post gets is elegantly simple, it proves to a company what its consumers want to see. Snapchat lacks comparable measurements thus; clients would be left in the dark.
There’s no question that Snapchat’s users are an untapped resource in mobile advertising; however, the app is fundamentally wrong for advertisements. The risk of invading user privacy is incredibly high and the metrics for measuring effectiveness are not in place. For now, we can only wonder why Snapchat declined a $3 billion offer.
How would you react if one day you opened Snapchat and it was teaming with advertisements?