What can you say about your product in 10 seconds? If you don’t know, it is time to figure it out. Ten seconds of 100% customer engagement is the secret sauce behind the rise of the popular social network, Snapchat, which is now reportedly valued at $19 billion. Snapchat CEO and Co-Founder, Evan Spiegel, recently confirmed the company has plans for an IPO. Just two years ago Snapchat turned down a $3 billion acquisition offer by Facebook and since then, the social network has continued to grow rapidly. A $19 billion valuation would make Snapchat the third most valuable tech start-up that is not publicly traded.
So why is Snapchat worth $19 billion? They are a social network that provides companies with a platform to capture the attention of one of the most difficult demographics to reach, Millennials, through a very finite amount of content. It is estimated that the average person is exposed to 5,000 ads a day and the Millennial generation (ages 18-34) is notorious for being difficult to target and address through traditional marketing efforts. How does a company best cut through that noise to reach Millennials? Simple, fast, and engaging (SFE) content is the best route and that is exactly the opportunity that Snapchat provides for companies. It is only a matter of time before companies and other social networks catch on and realize that their target markets no longer have time for lengthy and drawn out advertising.
If you are unfamiliar with the way Snapchat works, a user must hold their finger down in order to view a picture or video, and continue to hold their finger down for the entire 10 seconds, if they wish to continue watching. Read again: 100% engagement. Joanna Coles, editor-in-chief at Cosmopolitan says her channel on Snapchat gets two million views per day and viewers read every single story. It is almost impossible for a social media or advertising platform such as Facebook, Twitter, or even traditional media like television commercials to even get close to 100% engagement. In traditional advertising, you can measure how many people “watch” a commercial, but the large majority of those people “watching” aren’t really engaged. Snapchat can engage consumers and measure that engagement by tracking how many seconds they watch your ten second video (measured by when they lift up their finger to stop watching). Snapchat isn’t the end all and be all of marketing, but having the SFE content ability makes Snapchat one of the most powerful advertising platforms available and other social networks and advertising mediums should start to take notice.
In 2015, Millennials are projected to take over Baby Boomers as the largest living generation and currently represent $200 billion in purchasing power. Companies need to learn how to communicate with this demographic across all advertising platforms by grabbing their attention and quickly sending their message while the consumer is engaged. Snapchat’s new and fresh approach to social media has helped drive the company’s valuation from $3 billion to $19 billion in only two years. So what can you say about your company in ten seconds? $200 billion in purchasing power depends on it.