Last year, social media app Snapchat shocked the world when a Wall Street Journal article revealed that the company rejected a $3 billion acquisition offer from Facebook. Snapchat CEO Evan Spiegel told Forbes that he thinks trading for the short-term “isn’t very interesting.”
Following the release of a new report last week it could finally shed some light as to the app company’s long-term business model: the millennial generation.
According to data published by comScore, Snapchat is now the third most popular social app among millennials – those aged between 18 and 34 – and the company has one-third penetration on these individuals’ smartphones just behind Facebook (75.6 percent) and Instagram (43.1 percent).
This data means that Snapchat is more popular among the millennial demographic than Twitter (23.8 percent), Pinterest (17.9 percent), Google+ (18 percent), Vine (10.7 percent) and Tumblr (6.3 percent). This finding could prove that Snapchat is betting its long-term success and valuation on this age group as well as the future generations who are savvy with tablets and smartphones when they’re toddlers.
Tech experts say that what is even more astonishing is the fact that the disappearing photo app maintained a userbase of only 12 percent in Nov. 2013 when the news first began circulating that it had turned down Facebook’s offer.
Here is what comScore concluded in its report:
“Long term success in the social media sector is no given, and there are certainly several examples of companies that have both ascended into the stratosphere of successful tech companies and of ones that are no longer relevant. Achieving critical mass is an important step in eventually reaching the winner’s circle, and with Snapchat currently at 18 percent penetration among smartphone-using adults it would appear to be right in that sweet spot. If usage begins to accelerate significantly from this point forward, who knows how big it can eventually get?
Snapchat is an application that allows users to share photos, videos and messages with a list of recipients but a time limit is placed on how long they can be viewed, which is usually between one and 10 seconds.
CivicScience’s InsightStore released the findings from a different survey and discovered that 14 percent of overall consumers have used Snapchat. Furthermore, Snapchat users are mostly 24 years old and under, female, residing in households with incomes less than $25,000 and still living with their parents.
It is also believed that these users are immensely influenced by both their peers and social media, which is why Snapchat has become popular among brands like Beats by Dre, Urban Outfitters and H&M.
“Many of these brands are more younger-leaning, but the data is interesting to see which brands over-index the most among this app’s fan base. Apparel and accessories certainly bubble to the top and are categories well-suited for an app based on image sharing,” the research institute said in the report. “We also found it interesting that the Snapchat fans overall had higher favorability for most of the luxury or higher-end automotive brands. Many of them may not be in the market to buy a luxury car, especially with the majority (59%) earning under $75K per year, but they might be a compelling group for purchases as they get older and draw a higher income.”
With so much talk that the social media industry is in a bubble, is Snapchat a perfect illustration of this assertion? If the bubble does burst then Snapchat may become just like its app’s function: disappear.
