Over the weekend Snapchat rebranded to Snap Inc, the move was engineered to reflect the startup’s wider ambitions and coincided with the launch of its new product, Spectacles.
The name of the messaging app remains unchanged, and the brand refresh will only affect its parent company, with chief executive Evan Spiegel noting this will make it easier for users to search for "the fun stuff and leave Snap Inc for the Wall Street Crowd".
Taking to the stage yesterday (26 September) at Ad Week New York, Snap I chief strategy officer Imran Khan explained the decision and also unveiled some fresh statistics about the app’s users in a bid to woo advertisers.
Adweek reports that during his speech, Khan told marketers that the rebrand was designed to show that the firm is "bigger than just one app".
"The biggest misconception that I hear about Snapchat is that Snapchat is just another social media company," he continued.
Interestingly, Snapchat’s first foray into products beyond its core offering comes in the form of a pair of Spectacles – a pair of $130 Google Glass-style sunglasses with an embedded video camera. Commenting on the launch, Khan said that Snap Inc believed that "reinventing the camera" was its "greatest opportunity" to improve how people live and communicate.
Boosting confidence ahead of a potential IPO
Given the popularity of Snapchat’s Lenses – augmented reality overlays that add real-time special effects to selfies – it’s been long rumoured that the upstart had plans to expand into the AR space. However, while the creation of Snap Inc will indeed boost the its hardware ambitions, it’s also likely that that rebrand is part of an attempt to avoid the pitfalls of having a business model too dependent on advertising as it gears up for an initial public offering (IPO).
Up until about six months ago it was difficult for marketers to make a business case for Snapchat, but the messaging service has massively improved upon what it can offer to advertisers. It recently announced plans to streamline its formats and opened up its API to spark more interest; and while this is good news for brands, even Snapchat is wary about the impact it could have on the user experience, and has promised to tread the line with vigilance. Snapchat offers several different action-orientated ad units to advertisers, including Sponsored Geofilters, Sponsored Lenses and its vertical video product Snap Ads, which Khan yesterday cited as "the best mobile video ad product in the marketplace".
When it rolled out these new features a few months back, the messaging service assured its 150-million strong base of Snapchatters that it would "careful" about how many ads they would see, capping the maximum number of skippable video spots displayed between users' Stories to three promotions per-day upon launch.
While Spectacles provide video options that could prove attractive to brands in time, Snap Inc's move to diversify its product portfolio comes as the rumour mill goes into overdrive about the company's desire to go public.
Sources close to the company alleged a few weeks ago that the messaging app has been in conversations with people in the financial world about filing for an IPO as early as the end of this year, and its advance into hardware could boost confidence among potential investors.
Eyes on screens
During his Adweek slot, Khan gave marketers a bit more insight into the Snapchat's userbase. He said that over 60 million of its daily users come from the US and Canada, about a third of what Facebook boasts in the region (175 million). This follows on from comments he made at Dmexco earlier this month that 50 million are based in Europe, meaning the States, Canada and Europe make up 110 million of its 150 million subscribers.
While these latest stats might pale in comparison to Facebook's monopoly on the social media market, Snapchat is not far behind its 10-year-old rival Twitter, which doesn't reveal numbers for daily active users but has 66 million monthly US users.
Khan went on to say that two-thirds of Snapchat users create daily content within the app, and that the average person spends 25 to 30 minutes within its walls. This is key as time spent is becoming an increasingly important metric for marketers, who are demanding transparency on the issue, especially in light of Facebook's recent "miscalculation" which led to brands being given inflated video view timings by the social behemoth.
Finishing his talk, Khan said: "If you takeaway anything, I fundamentally believe we are just at the beginning of our innovation cycle, and I'm really excited to bring many new great products to our advertising partners in the next five years."