Will Advertising Be The End For SnapChat?

Will Advertising Be The End For SnapChat?
With Chris Arter and Ken Wisnefski


With their ephemeral messaging, SnapChat quickly became the social media messenger of choice for younger generations.  But last year with the release of the Stories feature, which allows users to post a string of videos and photos that stay live for 24 hours, SnapChat is shifting its previous image of merely being a messaging app to becoming the video app optimized for mobile.  In an effort to monetize SnapChat, CEO Evan Spiegel announced last Wednesday that people using the Story feature will soon start seeing ads.  I sat down with Ken Wisnefski, CEO of internet marketer WebiMax, to discuss the impact of advertising on SnapChat.



Chris Arter: What are some things that advertisers should consider with regards to utilizing SnapChat to market their products?

Ken Wisnefski: As of right now, SnapChat is almost exclusively utilized by the younger demographic. With this in mind, only certain types of products will really perform well via SnapChat. Advertisers like McDonalds and Taco Bell have leveraged SnapChat quite well to promote their brand through various promotions geared exclusively towards this platform.

Arter: Which businesses should advertise on SnapChat and which businesses should not?

Wisnefski:  Business to consumer based companies are best suited for this, especially ones that cater to high school or college aged consumers. Etailers and Retailers as well as fast food companies are the ones likely to see the most overall benefit as well as promotion of movies and TV shows aimed at that generation will see value from SnapChat.

Arter: According to Snapchat, Stories have overtaken Snaps as their most popular content.  Do you think the addition of ads will have an effect on that ratio?  Will the addition of ads “turn-off” a lot of their user base?

Wisnefski:  Ask MySpace what ads will do to your platform. At the end of the day, trendy platforms like SnapChat start to lose their cool once more focused advertising begins to interfere with user experience. Like anything else, if done effectively, they could be viewed as a common nuisance that all digital media now has more of. If overdone, it could turn off its audience pretty quickly and watch them move to a new platform.

Arter: What effect do you think this will have on other social media networks?  Do you think companies will shift their ad spend away from other social media networks like Facebook and Twitter?  Should they?

Wisnefski: I think Facebook is seeing good return from advertisers shifting ad budgets away from Google’s paid search programs while Twitter has struggled to really be effective in monetization. I could see some more budgets being utilized towards SnapChat as it has gained some real notoriety as of late, but I feel that budget likely is pulled away from traditional media or potentially from Google…I don’t see budget being pulled from Facebook to migrate to SnapChat at this time.

Arter: Recent reports of SnapChat’s valuation put it upwards of $10 Billion.  What is your opinion of that valuation?

Wisnefski: I love to see companies get these sort of valuations, but it is all based on future growth and value. I think that sort of valuation is excessive and likely very difficult to truthfully achieve. Do I think that it is a viable platform, I do, but I worry that as sites like Yik Yak and others that pop up become cool, that SnapChat users will just migrate away from the platform onto the next big thing. I see this sort of platform hopping as something we will see more of in the future. Being aware of the next hip app will be sort of a status symbol.

Arter: What does the future look like for SnapChat?

Wisnefski: I have concern that with the onslaught of new social media apps popping up all the time. SnapChat loses its cool factor as it tries to go from an up and comer to a sustainable business. I think that Evan Siegel, the co-founder of SnapChat is going to regret not taking that huge multi-billion dollar offer from Facebook. I think in two years, SnapChat will be as irrelevant as an 80’s sitcom, Alf.  I can guarantee Alf would have taken the $3 billion Facebook was offering.

Kenneth Wisnefski is a web entrepreneur on his 3rd successful startup. His previous two, VendorSeek.com and ImpactDirect both sold in 2008.  His current company, WebiMax (founded in 2008) works with over 600 clients providing Social Media Marketing, Search Engine Optimization, Website Design and Development, Paid Search, E-Commerce, and Search Engine Marketing.