The copied becomes the copier
After years of being the victim of "borrowed features" now it's Snapchat that's doing the borrowing. Snapchat's new product Spotlight is aimed squarely at competing in the short-form video space where TikTok is having so much success.To encourage creators to join Spotlight, Snapchat is using a not-so-subtle carrot. For the rest of the year they will share out $1m every day to creators who make the most viral videos.
That sounds like an enormous amount to give away — but because Snapchat has become increasingly efficient at monetizing its user base, it's actually a reasonable bet. Assuming they run the campaign until the end of 2020 (roughly 35 days worth), that's only $35m on revenue that will very likely exceed $2bn this year.
If Snapchat is able to draw some top creators to Spotlight it may be able to launch the most credible competitor to TikTok so far. Facebook's attempt, Reels, reportedly isn't doing well. Maybe Snapchat can succeed where Facebook has not? I think so.
Snapchat created the new feature after realizing that videos created with the Snapchat camera were regularly going viral on other platforms, such as TikTok and YouTube, because creators had little opportunity to grow their audience on Snapchat itself.
Spotlight will be a major change to how Snapchat users find content on the platform. For users, it will be reminiscent of TikTok’s “For You” page. But behind the scenes, Snap’s philosophy is very different. This is the part that I like the most. Users must explicitly decide to post videos to Spotlight, but by default, their profiles will be obscured – a move which allows creators to dabble in content creation without running the risk of unwanted attention. This is great because before Spotlight, users could only see snaps posted by friends or by publishers in the Discover tab — there was no "going viral on Snap." Many creators want it to stay that way.
That anonymity also lets Snapchat promote the feed as a meritocracy: one where previous fame counts for little. This is the genius in Snapchat's philosophy. The videos users see in their Spotlight feed won’t be affected by who they follow on the platform, and a new post from someone with millions of followers faces exactly the same hurdles as a first-time video from a new user in reaching the higher tiers of viral fame. That approach will prevent famous users from coasting on mediocrity, as well as encourage normal people to produce the most entertaining videos they can.
I am invested in SnapChat and will stay in for the long term. Over the past two years, Snapchat has become more and more efficient at attracting advertisers who were potentially looking for an alternative to spending on Facebook or Google. That progress, plus a return to growth in its user base, has reinvigorated investors and sent the company's market cap up 10x in the past 2 years. I think that will continue.
That sounds like an enormous amount to give away — but because Snapchat has become increasingly efficient at monetizing its user base, it's actually a reasonable bet. Assuming they run the campaign until the end of 2020 (roughly 35 days worth), that's only $35m on revenue that will very likely exceed $2bn this year.
If Snapchat is able to draw some top creators to Spotlight it may be able to launch the most credible competitor to TikTok so far. Facebook's attempt, Reels, reportedly isn't doing well. Maybe Snapchat can succeed where Facebook has not? I think so.
Snapchat created the new feature after realizing that videos created with the Snapchat camera were regularly going viral on other platforms, such as TikTok and YouTube, because creators had little opportunity to grow their audience on Snapchat itself.
Spotlight will be a major change to how Snapchat users find content on the platform. For users, it will be reminiscent of TikTok’s “For You” page. But behind the scenes, Snap’s philosophy is very different. This is the part that I like the most. Users must explicitly decide to post videos to Spotlight, but by default, their profiles will be obscured – a move which allows creators to dabble in content creation without running the risk of unwanted attention. This is great because before Spotlight, users could only see snaps posted by friends or by publishers in the Discover tab — there was no "going viral on Snap." Many creators want it to stay that way.
That anonymity also lets Snapchat promote the feed as a meritocracy: one where previous fame counts for little. This is the genius in Snapchat's philosophy. The videos users see in their Spotlight feed won’t be affected by who they follow on the platform, and a new post from someone with millions of followers faces exactly the same hurdles as a first-time video from a new user in reaching the higher tiers of viral fame. That approach will prevent famous users from coasting on mediocrity, as well as encourage normal people to produce the most entertaining videos they can.
I am invested in SnapChat and will stay in for the long term. Over the past two years, Snapchat has become more and more efficient at attracting advertisers who were potentially looking for an alternative to spending on Facebook or Google. That progress, plus a return to growth in its user base, has reinvigorated investors and sent the company's market cap up 10x in the past 2 years. I think that will continue.
Disclaimer: This post is merely my own assessment and is not an investment recommendation. For professional advice, seek input from a licensed investment advisor.
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