On March 2, 2017, life was looking quite bright for Evan Spiegel, Snapchat’s founder and CEO.
His company (Snapchat’s parent company) Snap Inc, went public opening at $17 a share. That day, Spiegel made a cool $272 million from selling 16 million of his shares, his company was speculated to become the first real contender to Facebook, and he was engaged to Miranda Kerr.
All of this isn’t to say that Spiegel’s accomplishments aren’t still incredible. The 27 year old is still doing exceptionally well for himself, having founded a billion dollar company before he was 30, a net worth of over $3 billion. However, the bright future Snapchat’s investors bought into back in the spring of 2017 doesn’t look so fruitful in light of the success Instagram Stories has enjoyed.
Instagram stories have been around since August 2016 and have been growing users ever since. They announced in November of last year that their daily active users number hit 300 million, far surpassing Snapchat’s 178 million active users. Having added their own rendition of many features that made Snapchat popular, such as augmented reality filters, Instagram is able to offer mostly everything Snapchat does, but with the added benefit of a larger reach for your posts.
Snapchat’s largest problem has always been monetizing it’s platform: it has the attention of an extremely valuable audience (Gen Z) but doesn’t seem to know how to turn a profit. Knowing all this and taking into account Snap Inc.’s failing stock price, has Snapchat peaked?
Let’s look at who is currently using each platform.
Who is on Instagram Stories vs Snapchat?
Instagram Stories boasts 300 million daily active users (DAU), 68% of which are female. 59% of internet users between the ages of 18 and 29 use Instagram and 33% of internet users between the ages of 30 and 49 use Instagram.
Which user bases are growing fastest and how?
Looking at the metrics, Snapchat’s growth has slowed since Instagram launched stories, and because Instagram has a larger active user base, they also have a leg up on attracting advertisers and continuing to successfully monetize the platform. Snapchat’s highly valuable audience is nothing to scoff at.
If Spiegel is able to find a way to make Snapchat profitable (which analysts think is unlikely until 2020) then we could begin to see the tide turn for the social platform.