Building a new online platform or medium is a precipitous climb; one simple move that turns out to be wrong can cause users to flock elsewhere in an instant. For this reason, it is extremely important for emerging applications to focus on the ways they can make changes to their user experience and how they can get to that treasured ‘Goldilocks zone’ – the place of utmost ease for users as well as advertisers.
Too Little Data
Snapchat’s potential for generating advertising revenue is still unknown, and we’ll probably have to wait until after it has been bought by another company to see its profit-making capabilities. Both Instagram and YouTube were ad-free until they were purchased, and many watching the market are thinking the same will happen with Snapchat.
One of the reasons that companies have been reluctant to embrace Snapchat as a medium on which to spread their brand is because the company releases so few metrics regarding the spread of the Snapchats coming from a user’s account.
Online advertising thrives on data — who is reading your message, how often, how is it being spread, and how (presumably) it is contributing to consumer behavior. This is the foundation upon which companies build their entire approach to advertising, yet Snapchat has been cryptic with this kind of data.
Whereas Twitter users can re-tweet and Facebook has the ‘like’ and ‘share’ buttons, Snapchat doesn’t havestatistically-verifiable information about how a particular message has spread.
Out-of-the-Box Branding Potential
Snapchat’s here-and –gone format may not appear to be made for advertising, but the ways companies communicate their brand and stay connected with their customer base is always changing. There may be many unexpected advantages to the format of Snapchat waiting to be discovered by out-of-the-box thinkers.
When the two-year-old startup turned down a reported $3 billion buyout from Facebook last November, many thought it was a brash move for CEO Evan Spiegel. However, Spiegel may be holding onto Snapchat because of a potential plan to expand it beyond its current capacity and set of uses — making it far more lucrative as a generator of ad revenue and perhaps worth far more than Facebook reportedly offered it. It appears that Snapchat has something up its sleeve with more advertising potential.
Various Ways to Monetize
There are a few ways Snapchat could generate income without filling the app with ads that turn users off to the experience.
One of these would be to charge users a small annual subscription fee. Many netizens prefer this kind of straightforward, voluntary approach, and with hundreds of millions of users and counting, the sky is the limit with the kind of profit subscriptions could turn.
Many companies, such as Taco Bell, Seventeen and the New Orleans Saints, are using Snapchat to keep their most loyal fans in the loop. But with changes, these could take the form of sponsored snaps that go out to a particular number of users, subscribed or not.
This would be a fantastic way to keep the app ad-free yet also highly profitable. If a company were to come up with a viral advertising scheme, the itinerant and fleeting nature of snaps makes them all the more appealing to fans of the brand. Companies could create snaps which revolve around some kind of interactive activity such as scavenger hunts or dance parties in a way that brings social media, the consumer, and the brand together in brave new ways.
Prepare for Snapchat’s Future in 2014
New and upcoming businesses can latch onto this kind of scheme as effectively as massive corporations, and with plenty of E-commerce solutions companies like the Jay group, users can go from unknown to heavy traffic during one good brain-storming session.
Snapchat’s future as a dependably profit-generating app could be meteoric or dismal, but it is apparent that they have big plans and that users have a lot to expect in 2014 from the popular app.
See also: How To Make A Great Social Media Marketing Plan