[tyleraldrich]

Perhaps there isn't just a good way to weave advertising into an app originally designed to send ephemeral pictures to friends? It seems like that's the real reason Snaps fate was preordained, and has nothing to do with Google/FBs ad empire.

[IBM]

I'd believe that if advertisers weren't shifting their budgets over to Instagram Stories at Snap's expense [1][2].

[1] http://markets.businessinsider.com/news/stocks/snap-stock-pr...

[2] https://digiday.com/marketing/scale-matters-advertisers-opti...

[tyleraldrich]

Instagram and Snapchat share exactly 1 feature ("Stories"), so I really don't see how this shows that Snapchat is failing due to Google/FB monopoly, and not due to the reason I listed above.

Instagram is more analogous to Twitter, and I assume advertisements occur both within the "Stories" and the newsfeed - this seems much more favorable to advertisers and is something advertisers are more used to.

[IBM]

When Facebook can graft Snap features onto every endpoint of their network, there's no oxygen left for Snap. They cannot get scale, and that's what you need in advertising.

[rgbrenner]

180m daily active users is not scale?

When Facebook IPOd, they had 160m monthly active users, and had $3.7B in revenue with $1B in profits.

And yet with more users, Snapchat pulls in $200m in revenue last quarter, and lost $440m.

The users are there. That's not their problem.

[skewart]

The online advertising world has changed a lot since Facebook's IPO. 180m users and an awkward ad buying experience aren't as compelling as they used to be.

Plus, it sounds like not all of those 180m Snapchat users are interacting with the part of Snapchat where they would see ads, so the audience is smaller.

That said, I completely agree that a lack of users isn't preventing them from having a decent advertising business. It's just preventing them from doing it on the terms they want.

[disgruntledphd2]

Are you talking about US users? I assume you are, given that FB was probably around 1bn MAU's when they IPO'd.

[replicatorblog]

They got scale, particularly among the younger demographic where the product was wildly popular. They never cracked an advertising model that worked.

I buy that it's harder for startups to break into social today, but that's true of most industries as they consolidate, I don't know that it means they're a monopoly.

Slack is a social networking tool that has managed to grow and scale by focusing on different use cases and by using a different business model.

If Snap had figured out how to get to profitability, or even focused more on reaching out to older users they may have found themselves in a different situation.

[boyaka]

I haven’t seen ads on Instagram stories, just intermingled in the feed. They are spookily relevant and noticeable.

Snapchat ads come at the end of 1 person’s story, or between random people if you have multiple peoples’ stories queued. I never do the latter because it’s a dark pattern to make you wait for the ad to finish before the next story, so I always watch 1 person, and swipe out if there’s an ad. In general, it seems like Snapchat ads are higher production quality and less relevant.

[mrkurt]

The Stories feature is _by far_ the most valuable to advertisers. It's reductionist to diminish that to "one feature they share". Particularly because Instagram straight up copied Stories from Snapchat.

[lysp]

The issue I believe with stories, is that Instagram allows metrics and snap does not.

Sure you can have 100k followers and say "80k people viewed my advertising story", but it stops at that.

Instagram provides deeper metrics and analysis which can help justify the spend to advertisers.

This is why a lot of Snap marketers have pushed their content to Instagram so they can get a better pay-day.

[rgbrenner]

And why do you think they are doing that? These customers are monitoring their ROI from these ads.. they know if they are effective.

Do you really think any of these customers are saying to themselves: "Gee Snapchat ads are so effective and are making us so much money... we better stop it immediately."

[pbalau]

You are right, Snapchat's failure to monetize their inventory has nothing to do with either Google or Facebook, simply because neither Google or Facebook has access to the Snapchat inventory to begin with.

I believe advertisers are not jumping on Snapchat's inventory because the perception about said inventory: kids chatting with other kids and porn. Why would you advertise on that?

[JAFTEM]

> Why would you advertise on that

A small percentage of companies are actively advertising on that. The featured stories (ads) on Snapchat almost always use sexual imagery to bait you into opening them. I agree, I don't think that's a sustainable model and it honestly shows how desperate Snap is to make revenue to allow these sort of ads.

[enervate]

porn in 10 seconds? thats gotta be the fastest hand in the west.

[tomc1985]

Yeah, what the fuck do they need an entire floor of an office building to be blocked off for anyway? Do they think they run The Manhattan Project?

I just can't wait to see what kind of life-changing innovation will surely result from this endeavor...