By Sarah Whitty
I’ve sparked many arguments at dinner parties with my hypothesis that Snapchat was going to struggle soon. And when I watched a Trend Hunter webinar where Jeremy Gutsche discussed three ways that disruption happens in the market place, I couldn’t help but note the similarities with my perceptions of Snapchat.
One, a competitor grows in a niche, innovative way. Two, a partnership, acquisition, or sale takes place. And three, a small competitor enters the market and nobody bothers to worry about them. Snapchat seems to fit quite nicely into that third description!
Gutsche also discussed 3 types brand self-perceptions that can lead to their rise or fall and once again, the relevance to Snapchat’s situation was perfect.
- Companies that identify as Paranoid: Zara, creates 11,000 dresses each year because they are doing everything they possibly can to keep everybody happy.
- Companies that identify as Troubled: When Domino’s pizza admitted they were troubled, they re-invested money in their product and saw great results.
- Companies that identify as Doing Well: Companies that ‘think’ they are doing well are more likely to be protective, repetitive, and complacent. I can’t help but think that Snapchat fell into this third typology of ‘thinking’ they were doing well such that they fell into a state of complacency and left room for competitors to rise and outdo them.
You have to wonder though, where specifically did Snapchat go wrong? They were themselves a disruptor, a small competitor that nobody bothered with, and now they are struggling to make money. What happened? Avtar Ram Singh, Head of Social at Publicis in Singapore has his own theories about Snapchat’s struggle which I’ve very briefly summarized here. (Read the entire post here.)
- The Snapchat experience is limited, and one-dimensional: The Snapchat app drives only short conversations that are only maintained once transferred to another app where message history is maintained.
- Good content is expensive: Unlike Facebook and Twitter, which can share content, Snapchat requires unique content. And this costs money.
- Snapchat lacks metrics: Snapchat failed to launch a user-friendly, self-serve ad tool soon enough that would track more than just total views, story completion rates, and screenshots. They held themselves back.
- Clones are doing it better: Instagram Stories launched in August 2016 and Snapchat’s growth slowed by a massive 82%. Need I say more?
- Snapchat didn’t play the influencer game well: Snapchat stars have seen their daily viewer rates drop significantly and some Snapchat influencers (e.g., Michael Platco) were warned to “follow the rules,” all while competitive social media platforms expertly cultivated their influencer relationships. Snapchat was certainly not building positive relationships.
- The signals from Snapchat do not inspire trust: Since their IPO, Snapchat has not provided any numbers to inspire much confidence amongst the business folk, or the marketing community.
Snapchat faced a number of marketing challenges but without a clear strategy for growth and innovation, they are suffering the consequence. The moral of this story is, no matter how successful your company is, it is never ‘too big to fail.’
“Success breeds complacency. Complacency breeds failure. Only the paranoid survive.” – Andy Grove