Blink and It’s Gone - If someone offered you three billion dollars right now, do you think you would be able to turn down? I’ll give you a moment to think about it…of course you wouldn’t. Well, for a group of college buddies from Southern California, this may have been one of the smartest decisions of their life.
In November 2013, the mobile application Snapchat made international headlines by turning down a three billion dollar offer from social media juggernaut Facebook. Most people in the industry thought that Snapchat’s creators, Evan Spiegel and Bobby Murphy, were insane when they turned it down since the app has no direct revenue stream. But this seemingly foolish decision may soon pay off for the Stanford University graduates. It was announced on Wednesday that Snapchat is in talks with investors from the Alibaba Group, China’s biggest e-commerce company, for a round of financing that could value the company at $10 Billion, roughly 3.3 times more than Facebook’s original offer. The deal is far from finalized, but it could make sense for both parties involved. Snapchat has failed to gain any traction in the populous Asian market, while Alibaba has seemed to miss out on the popularity of mobile messaging. A partnership between these two unlikely allies could help solve each other’s problems.
This possible investment has once again thrust Snapchat front and centre in the news, which makes it a great time for Sports Brands to a serious look at how Snapchat could be used to help market their organization.
I’m sure most readers are avid Snapchaters, but for those who aren’t (read: Blackberry users), I have put together a quick little intro course on Snapchat basics. Snapchat is a real-time, ephemeral, photo messaging app which is extremely popular in the 13-25 year old demographic. Users can send photo or video (up to 10 seconds) snaps to their friends. The users can personalize their message by overlaying text, using filters, or drawing on them with the pen tool. The novelty of Snapchat is that the messages disappear after ten seconds, and can never be seen again (Snapchat alledges).
Why not screenshot the picture you ask? This is a big no-no in the Snapchat community and has become an unwritten rule (users will be notified if someone has screenshotted one of their snaps. This element of secrecy makes the trading of snaps feel quite personal…sometimes too personal. One of the newest features “Stories,” may also be the reasons that Snapchat has recently become a popular marketing tool. The story feature allows you to create a set of snaps that can be watched by your followers an unlimited amount of times for up to 24 hours after their posting. There are many other intricacies of Snapchat, but I will let you find them out yourself.
Now that we all have a greater understanding of Snapchat, I can now discuss the opportunities that it creates for brands:
It is New
Snapchat has been up and running since 2011, but really hit its stride in 2013, when it seemed to always be in the news (some good, some bad). This lack of history means that few things have been tried before on Snapchat, which leaves a lot of room for experimentation and innovation. The potential of Snapchat has yet to be unlocked yet, but when over 400 million snaps are being sent out each day it is definitely something that needs to be taken seriously.
It creates a personal connection
On Facebook or Instagram a follower may just scroll past a brand’s posting, but on Snapchat the consumer has to actively hold down the screen, giving you their undivided attention. For a demographic who is known for having a short attention span, this application is perfect. Some people may skip over a video on Facebook if it is longer than two minutes, but who doesn’t have time for a 10 second snap. For professional sports teams it allows them to showcase the individual personalities of their players. During the 2014 NBA Draft the NBA used their account to show players arriving, which is usually behind closed doors. It’s a great way to create a more interactive relationship with the consumer, something that all brands are always looking for.
It reaches a younger demographic
In the all important college student demographic, Snapchat is running rampant. A staggering 23% of Americans aged 18-29 are using Snapchat on a regular basis. While this may not benefit a brand that caters to an older crowd, it is perfect for one trying to capture Gen-Y dollars. It is also still growing, Snapchats user base grew 67% between December 13’ and May 14’, which makes now a perfect time to get into the Snapchat game.
How brands are currently using it
While not many brands have taken advantage of Snapchats vast audience, there are a couple early adopters in the sports world who are attempting to increase their fan engagement. Here are just a couple examples:
Chat Sports, an online ticket retailer, holds Snapchat giveaways to increase their following. Their first promotion gave followers a chance to win tickets to a local sporting event. To win the tickets, the users had to convince 5 friends to add ChatSports on Snapchat and then send in a snap with the friends name and #gimmetickets. Only 150 people responded, but for a larger company this could be a great way to break onto Snapchat.
New Orleans Saints
The Saints, along with the Philadelphia Eagles were two of the first professional sports teams to test out the app. Both organizations utilize the story function of the app to create a behind the scenes narrative. It allows fans the opportunity to go behind the scenes, participate in contests, see video shout outs from players. In the age of the 24 hour news cycle, it is a great way to maintain contact with fans in a new way.
There have been some NFL and NHL teams to join snapchat, but from a league standpoint, the MLB and NBA are the only ones to have accounts. The MLB joined Snapchat in February during their annual spring training. They were interested in the platform since it was so popular among their following, and they believed it would allow them to reach a more youthful demographic. Their account is very laidback and often features lighthearted snaps from players and stadiums around the league. It gives them the opportunity to showcase the personalities of the players, and create a personal connection with the game.
With every new social media platform there is always the question of how can this be monetized, and how can marketers use it to help their brands. It seems that brands have been able to find a way to help their brand perception, but are still looking for the golden ticket of how to increase revenue through the platform. With over 400 million snaps being sent back and forth each day, I’m confident that someone will be able to unlock this $10 billion dollar question.