While Snapchat has the following and growth metrics that would be sure to make most app developers jealous, it does have one problem: it doesn’t appear yet to be making any money.
For the investors behind Snapchat Inc., monetizing the incredibly popular app is no doubt a priority.
But how will this be done? Likely a combination of sponsored content and data-driven advertising. Snapchat by its own admission has 30 million users, 50% of those are aged 13-17, and as they send over 700 million photos a day Snapchat gathers all kinds of data on them. Crunched into something marketable, Snapchat could easily prove the worth of its $10 billion valuation.
Every piece of content users view is triggered by pressing and holding the screen, meaning people have to consciously engage with content while using Snapchat,” reads the deck. “When people share, recipients pay attention, knowing content can’t be viewed a few days later.”
Looking through Snapchat’s pitch deck, first obtained by Digiday, and one sees that Snapchat’s reported engagement metrics are flooring. Between December 2012 and October 2013, Snapchat has grown from a 50 million snaps-per-day operation, to 700 million sent October. Users now open their Snapchat app an average of 14 times per-day.
But many that aren’t in Gen Z are left wondering what exactly the purpose of Snapchat is. They understand the self-destructing message functionality, though the pivotal question remains: “but why?”
Snapchat, for its part, tries to answer that question with the Silicon Valley buzzword language it knows best: “At Snapchat, we’re bridging the gap between the digital and real-world, and we’re just beginning.”