The Future Of Snapchat

Snapchat took the Internet by storm yesterday, announcing animated lenses that distort users’ faces and add content and filters.  The filters looked identical to those of a company I remember seeing on Kickstarter about a year ago called Looksery. There are a few reports of Snapchat acquiring Looksery for $150,000,000 dollars. Looksery raised $40,000 Kickstarter last year and got acquired for 150 Million this year - let’s hope that's a trend that works out for FEAT Socks too.

Along with the video effects update, Snapchat also announced its first in-app purchase.  4 years after its' inception in 2011, Snapchat is finally trying to monetize their users*. For 99 cents, you can buy 3 Snap Replays. A Snap Replay does exactly what it sounds like, allows you to replay someones Snapchat before it disappears forever**. Users are given 1 replay a day for free, and I'm probably the only one out of my 300 Snapchat friends who actually uses it.*** Practically every time I replay a snap I get a text within 5 minutes saying "Why did you replay my snap?"  Using the replay feature is not a social norm, and I get called a weirdo almost every time I do it. No one is going to pay for replays! No one uses replays. None of the users are talking about this, because all they can think about is puking out rainbows, but after my rainbow came out of my mouth, I started thinking about other things.

What other in-app purchases could they do?

Whenever I think about this question, I think about what I would actually pay for, here are a few thoughts:

1)  See who views your story. After you post a story you can see who has viewed it. I have 300 friends on Snapchat, and whenever I am scrolling through my story looking at who watched it, I only really look for about 5 names - ex-girlfriend, friends the snap relates to, girl I think is really cute, and best friend. If Snapchat only let me see the 10 most recent people that viewed my video, but allowed to pay something like $1/month per person, to permanently see if that person viewed my story or not, I would pay for a few subscriptions of that.

2) Lists. When I take a Snapchat of something that relates to a certain group of people I want to be able to send it to them easily. Example: If I see something funny that relates to my fraternity from school, I want to send it to my 50 fraternity brothers I have on Snapchat. Right now, I have to scroll through all my friends and choose them one by one, and sometimes that takes up to 5 minutes. I would pay $5/ month to turn my contacts into list, and be able to group them. So I could add all my fraternities brothers into a group and click that group to send an individual snap to all of them. I would pay to have groups for my Fraternity brothers, my college friends, my work friends, my high school friends, etc.

3) Replays. Haha just kidding.

There are a ton of other in-app purchases I have written down, but I am not going to bore you with all of those. Here is one last crazy idea though before I wrap this post up.

Users will be more inclined to make in-app purchases if they weren’t using real money. Users can make money on Snapchat watching advertisements. What if Snapchat allowed you to enter your age, location, interests, and all the other information advertisers covet? Then you have the option of watching different branded content from companies who targeted you. Make it as if you are watching a story, but you aren’t allowed to skip forward. If you watch the whole segment, you are rewarded with money (Money that you can’t cash out, but can use towards in-app purchases).  

Who Wins?
Snapchat- They would charge the advertiser something like 5 cents per 3 minutes of their ads watched, and pay the users 3 cents per 3 minutes of ads watched, and make money off the margin. Because it is optional, they are not diluting the user experience at all, in fact they are enhancing. The users will start becoming comfortable and more dependant on in-app purchases, and more willing to spend money on the app. Snapchat could then charge higher rates for advertisers, lowering the volume of ads available for the user to watch, forcing the user to reach into their pocket to buy the in-app purchases they have grown to love.

User- They are getting free money, and ability to use premium features for free. It is 100% optional, not affecting the experience of those not interested.

Companies- A low cost, innovative way to advertise to targeted demographics.  They could set their budget, and bid for the demographic and know how many views they would get. Example: They could set their budget at $100, the bid for the 21-24 year old demographic in San Francisco could be 10 cents per every 3 minutes viewed. So they know they will reach 1,000 21-24 year old who will watch their full 3 minute video, then their video would disappear, and the user will be left with a call to action button.

Thanks for reading my two cents on Snapchat, feel free to leave your thoughts in the comments.

*You can say they have monetized their users in the past with the different sponsored stories and advertisements, but this is their first attempt to get money out of their users pockets.

**I got to met Evan Spiegal a few years ago at a conference at MIT. When I asked him if the snaps actually delete forever, he said, and these aren't his exact words,"They get buried so deep in the server that they are practically impossible to recover." Not permanently dissolved into the ether, a la Mark Cuban's Cyber Dust.   Read more about it here

***Because with I am the guy who uses every feature on every social media because I love testing and exploring with the platforms.