It wasn’t all that long ago that so-called ephemeral messaging app Snap (nee SnapChat and SnapChat is less private than you think, as we know) hit the zeitgeist, and quickly seized a sizeable share of one-time Facebook users – especially the younger ones. Now, as Business Insider notes, Snap is working on an IPO for March that would value the company at $25 billion, and “…as part of Snap’s evolution, it’s become an increasing threat to Facebook and Instagram in terms of both attracting younger users and chasing ad dollars. A Nielsen study from September 2015 showed that the company was reaching 41% of all 18- to 34-year-olds.
“That number is likely higher now. A recent eMarketer study said that Snapchat will have reached 58.6 million people in the US, or 31.6% of social media users, by the end of 2016.”
And to think that founder Evan Speigel was considered non compos mentis for having turned down a $3B offer from Facebook just a few short years ago, although as we ourselves reported back in 2013, “right or wrong, Snapchat skated to where the puck is going.”
Which seems to be part of the company’s DNA. Snap recently unveiled Spectacles. Said Recode, Snapchat’s camcorder goggles are creepy cool and kind of brilliant. Despite the fact that they are both cool and affordable ($130), comparisons were drawn to the failed Google Glass. But as Recode observed, “Glass, a too-serious attempt to put a computer on your face, looked ridiculous in a bad-taste, cyborg way. It introduced a creepy privacy violation — a face-mounted camera that you, as a bystander, couldn’t control — with poor explanation. Its early adopters, “Explorers” who spent $1,500 for the privilege, were derided as “Glassholes,” widely mocked, and sometimes abused. The whole thing came across as a poorly planned embarrassment… Spectacles look like a funny, laid-back play on designer sunglasses. They’re cheap enough to be an impulse purchase for many, or a reasonable gift. He’s positioning them as a “toy.” A leaked video suggests they light up very obviously when shooting, though the subtle recording is still a potential privacy issue.”
That comes with the territory and time will tell – Spectacles will not be available until December – but the comparisons should pretty much stop there. Snap knows its customers/audience: Google Glass is the Borg; Spectacles are the ‘Burg (as in the cool kids whose stomping ground is Williamsburg).
Snapchat first showed up at a time when Facebook pretty much was thought to have owned social media, game over. Did the world need another social network/messaging app? No, if you view tech vertically rather than through the perspective of addressing the needs of the end users, and guess so, considering the valuation of Snap’s impending IPO. What to speak of the fact that Snap pretty much ate – and is continuing to eat – at least part of Facebook’s lunch. Says Business Insider, “Snap has told investors that it expects to make between $250 million and $350 million in advertising revenue this year, according to The Journal. A recent eMarketer report predicted that the company will near $1 billion in revenue in 2017 — meaning a $25 billion IPO would be priced at 25 times its projected revenue numbers….This would be the largest public offering for a tech company since Alibaba went public in 2014 for $168 billion.”
Zuckerberg is obviously keeping a close eye on the company – as well he should, but forest through the trees: Mark Zuckerberg and Evan Spiegel are two very different kinds of leaders, Zuck being as predictable as Spiegel is unpredictable. The latter’s strength is in knowing his audience, while the former takes a Mack truck approach. All well and good, until a Snap – and an Evan Spiegel – come along. How closely an eye is Zuck keeping on his competition? Facebook “Messenger Day” is the chat app’s new Snapchat Stories clone, says TechCrunch. In other words, Facebook is not innovating, it’s cloning/stealing, or as some wag or other might put it, going back to their roots.
In an industry where valuations are based largely on somewhat fickle eyeballs as much as anything, no one stays on top forever and good idea to never lose sight of your audience. Even better if you can put a smile on their faces, and keep them coming back for more. As Shelly Palmer says, “Evan Spiegel is a product designer’s product designer. And his attitude about getting Spectacles to market quickly “because it’s fun” should be an object lesson for every CEO.” Zuckerberg may have the eyes – at least for now. But make no mistake about it: Evan Spiegel has clearly got the balls. Onward and forward.