So far, the year’s top business story has been the long-awaited Snap Inc. IPO. The company plans to go public next month in a $3 billion offering which could give it a market cap
of up to $25 billion. The IPO outlines how the company’s signature Snapchat product boasts 158 million daily users, who consume over 10 billion videos each day. Snap Inc. grossed over $400
million in revenue last year and is aiming for $1 billion this year.
The service is a particular juggernaut with teens and young adults. According to Christina Newberry,
nearly a quarter (23%) of its users are teens, and a full 37% are Adults 18-24. Looking at it a different way, comScore says about two-thirds of Adults 18-24 with a smartphone use Snapchat. The
product’s success with teens and young adults stands in stark contrast to the declines in viewership experienced by young-adult networks. According to Christopher Mims in The Wall Street
Journal, Nielsen measures a 37% decline in viewing among Adults 18-24 from 2010 to 2016. Suddenly, teen wolverines and high school show choirs aren’t as interesting to watch as disappearing
messages, short video “stories” and puppy face filters.
What can marketers learn from the Snapchat phenomenon?
- Short, skippable ads are more
engaging. In many ways, Snapchat has “cracked the code” on delivering ads that young adults actually pay attention to and enjoy. The ads are short (under 10 seconds); fun to
watch; tailored to the target demo and the content, and can be skipped if they aren’t of interest to the user. Snapchat serves three of these short ads in every 90-120 second
“story,” and charges less for ads that are skipped. Suddenly, those interminable cable-network commercial pods crammed with :30’s look like dinosaurs. So one of the keys to reaching
a generation with a short attention span is to keep marketing messages short, fun, tailored and skippable.
- Co-creation is powerful. Another powerful marketing
application of Snapchat is involving users in co-creation, through the use of innovative filters. Advertisers as diverse as Fox, Starbucks, L’Oreal, Budweiser, Taco Bell, Las Vegas and Trump For
President have paid to incorporate their brands into the “filters” that users apply to their pictures, which literally allow them to be spokespeople for the product, and send it out to all
their friends. As effective as a clever :10 promo can be, nothing can beat seeing a friend personally endorse and interact with a product. The more tools you give customers to co-create with a brand,
and the easier you make it to use those tools, the more customers will do your work for you in promoting your brand.
- Low pressure = high performance. Many teens
who use Snapchat do so not only for its privacy but also because the “stakes” there are so much lower. There are no “likes” on Snapchat as there are on Facebook. They
don’t have to perfectly stage, shoot and filter their photos as they do on Instagram. Their content can’t go viral and be mocked by strangers as it can on Twitter. Snapchat is a safe place
for self-expression, and it encourages (even demands) quick, impromptu, true-to-life posts. As teens complain more and more about increased pressures around school, jobs, activities, college
admissions, changing societal norms and the political climate, it’s a relief to have one place where they can just be themselves among friends. The tenets of Snapchat lay out a set of best
practices for any marketer providing a forum for teen customers through an app, website or social media channel.
While few brands can grow from nothing to $25 billion in a
little over five years, every brand aimed at teens has a lot to learn from the Snapchat phenomenon.