Snapchat is an augmented reality (AR) video messaging application created by Evan Spiegel, Bobby Murphy and Reggie Brown when they were students at Stanford University. Using the application, users can take photos, record videos, add text and drawings and send them to a controlled list of recipients.
The platform has a reported value of $15 billion with a majority of its usage been seen in teenage markets. In its origins, Snapchat was one of those outliers that where not expected to make it given the highly competitive nature of the social media industry.
Given its rise in popularity, what does it mean for the entrepreneur in an emerging market such as South Africa?
Despite the exciting numbers SnapChat enjoys and the media coverage that comes with it being the new kid on the block, Snapchat, in terms of the South African market does not see the normal uptake it enjoys in other established markets. The main barrier of adoption in South Africa and in Africa can be traced purely to the aggressive growth strategies already being pursued by the bigger social networks.
Taking on the Big 4
Whatsapp, Twitter, Facebook and YouTube due to higher mobile penetration and more flexible data plans being offered by telcos are seeing an increase in trial and use. Given that Whatsapp, Facebook and YouTube’s benefits are beginning to only be experienced in Africa on a macro level, a small contender like Snapchat cannot easily penetrate Africa. The Share of Voice (how much a brand or product is talked about compared to its competitors) and awareness alone that the aforementioned brands enjoy is formidable and creates a huge barrier to entry.
These social networks still remain aspirational in a market that is still fraught with feature phones that give a minimalist experience. Snapchat, even with all its unique features, cannot compete in Africa where scale is valued more than anything else.
“Small to medium enterprises are still struggling to fully utilize the big four social networks effectively to get return on investment “
With urbanization increasing and region-to-region migration as well, the need to stay in contact with family remains pivotal. A person would rather opt into a platform that is enjoyed by the bulk of their family than opt for one that is elite. Teenagers in emerging markets as well are only beginning to access these social media platforms and are realizing their benefits such that Snapchat is lost in the noise that the big four currently make.
Should you care about Snapchat?
In short, Snapchat is a platform worth watching, however, it is one not really worth investing in this first quarter of 2016. Small to medium enterprises are still struggling to fully utilize the big four social networks effectively to get return on investment adding a fifth one to the matrix is only adding another layer of complexity to digital strategies that are currently failing to aid the SME gain access to customers so that their cash flows can improve.
The below graphic gives a small reflection of the current digital landscape. As shown by the numbers below it is evident that Snapchat remains an outlier in Africa, one of course that we still continue looking at.
Brave Insight
Although Snapchat is not one of the social networks to invest in this first quarter, there is something to be said about its story that is worth learning from.
Snapchat went through many failings before it finally got it right and central to them getting it right was the key insight that they arrived upon. In spring 2011, Reggie Brown, one of the co-founders said, “I wish these photos I am sending this girl would disappear.”
Soon after, Evan Spiegel had heard about the idea and was jazzed about it and there began the story of Snapchat. Their story illustrates to us that a brave insight should be the key determinant for any business entering into any industry. As an SME, one should ask themselves what key insight do they have about the market before they even begin to dare to enter the market.
About the author: A behavioural economist with a focus on digital strategy, Tavonga Musingarabwi is currently a digital strategist at marketing and advertising agency, Aqua. He has over a decade of experience in both traditional marketing as well as new media marketing. He has worked with many brands pertaining to their Digital presence and sees a future whereby Africa can truly utilize and harness the power of technology. Musingarabwi has also successfully helped South Africa in it’s bid for the Commonwealth Games of 2022.
