Is Snapchat Worth the Headache?
Snapchat
is a monster. According to the social media giant, over 166 million people
use the app every day to connect with their friends and explore curated content
from top publishers. Snapchat users also spend an average of 30 minutes on
the platform daily.
Probably
the most mind-boggling stat is that Snapchat reaches 45% of all 18 to 24
year old social media users in the U.S, according to e-Marketer.
So shouldn’t advertisers be running to the
platform?
They
haven’t, and Snapchat’s recent financial woes reflect that: After filing for their IPO in
February, they missed their Q1 target of $158 million, with reported revenues
of just $149.6 million. Taking into account that $149.6 million in revenue,
Snap reported a net loss of more than $2.2 billion.
After
their Q1 report, stock in Snapchat's parent company Snap Inc. plummeted
some 23% in after-hours trading, declining to $17.64 per share. It’s currently
trading below $13. Snap's expected to release its Q2 earnings report later this
week (August 10th).
One of the
biggest reasons for their financial struggles is because Snapchat makes it
tough for advertisers to market on their platform.
First,
they lack detailed statistics for advertisers to maximize the effectiveness of
their ads. Snapchat uses third party solutions, like Data Cloud, TUNE and Moat,
which only give basic information; like the number of people that watch a video
and for how long. They desperately need click through and completion stats.
Until recently, they
didn’t allow much targeting data for agencies and advertisers, which means
they’re casting a wide net, hoping to reach the right customers.
If you
want to get your professionally produced content in Discover, forget it
- Snapchat requires literally months’ worth of content to be submitted to
prove that you can produce high quality video on a regular basis.
It’s also
a lot of work for advertisers to create content for Snapchat. Because
advertisers usually aren’t repurposing their content - as they would on
Facebook or Instagram - there is a ton of waste. To make things even tougher
for advertisers, Snapchat has, thus far, been super protective of the creative
process of their ads. Who wants someone looking over their shoulder when
they’re trying to make something?
Not
playing nice with influencers is also a common gripe. According to a
recent Dig day article,
“When an influencer who grew frustrated with
the platform told a Snapchat product management executive that she was thinking
of leaving Snapchat, the executive point-blank asked her to, saying, ‘Snapchat
is an app for friends, not creators.’ Because of that hard line stance,
influencers are taking their massive followings and leaving the platform.”
Competition
has also slowed Snapchat’s user growth. Facebook and Instagram have copied some of
Snapchat’s core features, including expiring video and geofilters. Instagram
Stories now boasts 250 million daily users,
surpassing Snapchat’s 166 million. Zuckerberg and Co. seem on a mission to
crush Snapchat - and based on the latest numbers, they
look to be on track to do just that.
So is it
even worth it for brands to use Snapchat?
Short
answer is 'Yes'.
As per Nick Cicero, CEO and
Founder of Delmondo, a social
video analytics company and creative studio which produces both organic content
and Snap Ads for brands like Marriott Rewards, Mike’s Hard Lemonade,
NASCAR and the UFC:
“There’s still a large, highly engaged, and
interactive audience on Snapchat, and a sizable audience that you can’t reach
anywhere else. So for advertisers, still looking to reach consumers under 25,
there’s a massive amount of time still spent on Snapchat interacting with
friends, chatting and consuming stories,”
So,
is Snapchat worth the effort? Absolutely - if that's where your audience is,
that's where you need to be.
But, is it
a pain to create expiring content? Yes. Is it almost impossible to get
discovered organically? Yup. Are Snapchat's search and discovery tools terrible? No
question.
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