What’s In Store for Snapchat’s Future?
By Alyssa Ray
Recently, Snapchat has reportedly turned down a monetary offer of 3 billion dollars from the social media mogul, Facebook. Snapchat was founded back in 2011 at Stanford University. The mobile application has become extremely popular amongst the millennial generation, where users can send brief images where you can draw or add text. The application itself is free to download and features no form of advertisements.
Facebook, who went public in 2012, purchased Instagram to expand its user base. After Facebook copied similar features from the popular application, it eventually purchased Instagram right before the company initial IPO offering. Instagram walked away with nearly $1 billion dollars in stock versus the $3 billion dollar offer to Snapchat. So one might ponder, what would Facebook gain from the acquisition of Snapchat.
In a recent article for AdAge, David Berkowitz stated, “There are two problems Snapchat has with advertisers. One is a perception gap. The other is a values gap. The former can be remedied; the latter can’t if Snapchat stays remotely true to itself.” With this in mind, it is hard to imagine a world where Snapchat can transition into a position where they can make money. Snapchat has had a reputation of being utilized as a form of sexting in teenagers, making it an undesirable outlet for advertisers. In addition, the consumer mind sight is important to keep in mind. Many view Snapchat as an extension of texting, thus, the impeding presence of the advertisers would be undesirable for many of the consumers. Finally, if Snapchat was to begin charging for their application it would be contrary to their brand image.
Should Snapchat have accepted the deal with Faceboook? What do you think?
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Sources:
http://adage.com/article/digitalnext/snapchat-ads/245265/
