Snapchat Opens Up Its Marketing API

Happy Humpday.

First, congrats to the Flying Tomato, U.S. snowboarder Shaun White, who flew through the bruising air of Pyeonchang yesterday to take the gold medal in the men’s halfpipe snowboarding competition. And that, ladies and germs, is a full-on gold medal American sweep of the Olympics snowboarding competition.

Now, Snap to it, because Snap is now opening its Marketing API for all developers to use.

According to a report from VentureBeat, the company first opened its API to a limited number of advertisers back in 2016, which allowed tech and creative companies to deliver ads and put it on the road to programmatic advertising.

“Our advertising business changed profoundly over the past year as we migrated the sale of our Snap Ads to an automated auction,” said Snap’s cofounder and CEO Evan Spiegel during its recent earnings call. “Over 90 percent of Snap Ads were bought programmatically during Q4, which means that the auction transition for Snap Ads is largely behind us.”

With this move to open up its Marketing API, this should provide more accessibility to Snapchat to even more advertisers, and in the process create some economic upside for developers.

Google’s Getting AMPed

How about that gold medal for America’s own Chloe Kim in the halfpipe snowboarding competition in Pyeonchang.  She was flyin’ like an eagle, in spire of the harsh winter winds.

Keep on truckin’, US of A.

Meanwhile, over at the Alphabet, Google has unveiled some new capabilities that seemed to be aimed squarely at Snapchat and Instagram in some friendly competition of their own.

The new capabilities, as reported in today’s Wall Street Journal, let publishes create visual-oriented stories in a mobile-friendly format not dissimilar from Snapchat and Instagram. 

Starting today, publishers can try out the developer preview of AMP stories, which include swipeable slides of text, photos, graphics and videos.

The Journal writes that “AMP stories are reminiscent of the immersive, vertical stories pioneered by Snapchat,” but that AMP stores don’t yet allow advertising to be incorporated, suggesting that Google is in the process of “building support for ads but didn’t disclose a time frame.”

It’s only a matter of time.

A Snap Investment

Happy Hump Day.

Chinese Internet firm Tencent has taken a roughly ten percent stake in the popular messaging app, Snap, according to a report by CNBC.

Tencent runs the WeChat messaging app, as well as online payment platforms and games.

Snap shares took a beating yesterday afternoon to the tune of 20 percent in after hours trading after reporting average revenue per user was up 39 percent YOY, but failing to meet Wall Street estimates.

Tencent is one of largest Internet companies in the world, featuring a variety of services that include social networking, e-commerce, mobile games, multiplayer online games, as well as it’s well-known instant messenger Tencent QQ.

Its WeChat mobile messaging service has over 1 billion monthly active users and is known as China’s “App for Everything,” including instant messaging, commerce, and payment services.

It’s a Snap

CNBC Headline this AM: “Snap is now alienating the very people it needs to survive, say ad agencies.

Subhead: Several agencies said advertiser interest in Snapchat is flat to dwindling, as many opt to move toward Instagram.

Second Subhead: Issues with Snap include continued issues over measurement, difficulty in finding content, influencers moving to other platforms and lack of outreach to agencies and brands from Snap.

Oh, Snap, indeed, do we need read any more?

Snap’s post-IPO high reached it the high $20s, but as of this AM was languishing around $12.18.

But wait a minute, I thought conventional wisdom indicated Snap was going to save the advertising industry and send brand managers everywhere running into the streets in celebration.
So wha’ happen?

See the heads and subheads above. They’re getting outplayed by Instagram, and there also seems to be a big issue with discoverability:

“Instagram is built for finding what you don’t follow easily, Snapchat isn’t. If Snapchat can figure that out, that will help, because why make content people can’t find?”
– via CNBC

If you can’t get influencers, it’s hard to build an audience, and without an audience, it’s hard to attract a brand.

They’d better snap out of it and soon.

A Messenger Day

Let the SnapChat clones begin.

Today Facebook announced it was globally launching Messenger Day.

This new app will roll out on top of Facebook’s chat app on both iOS and Android, plus in Facebook desktop Messenger. The new feature will let you share with the public or a custom friend decorated photos and videos that disappear after 24 hours.

That is, of course, unless the CIA has already broken into your iOS or Android phone, in which case all bets are off.

All joking aside, I don’t think we can laugh this thing away out of the gate.

As TechCrunch observed, 1 billion people a day use Facebook Messenger, and Facebook is not afraid to copy great ideas. Why should somebody step out of Facebook and go over to Snapchat if they can just do what they need to on Facebook?

To whit, Snap Inc. chat is settling into the $22 range this afternoon, now that the news has sunk in. It appears that its messages aren’t the only thing disappearing at SnapChat.

Here’s what Facebook’s blog post introducing the feature explained the new Facebook Messenger Day capability:

Here’s how Messenger Day works: First make sure you’ve updated your Messenger app so you have the latest version. Open Messenger, and tap on the camera highlighted with a sun to celebrate this launch. Doing so drops you right into the full-screen camera. Or, tap the “Add to your day” button at the top of your inbox to get started. Snap a quick selfie or take a photo or video of what’s around you. To add art and effects, tap the smiley face icon in the top right and then tap to add to your photo or video. You can also add text over your images by tapping the “Aa” icon, and you can overlay a drawing by tapping the squiggly line in the top right corner. Once you have your photo or video the way you want it, tap the arrow in the bottom right corner. You can then add directly to your day, save it to your phone’s camera roll, and/or you can choose to send it to a specific person or group of people. The photo or video that you add to your day will be viewable for 24 hours.
– via newsroom.fb.com

The Snapchat Story

If you haven’t been following the evolution of Snapchat, then you probably don’t realize that it’s a mobile app that allows one to send videos and pictures that “self destruct” a few seconds after someone views them.

Kind of like those “Mission Impossible” messages that blow up after Ethan Hunt reads/views them. Only less dramatic.

What’s not disappearing anytime soon is Snapchat itself. It’s currently about to embark on an investor roadshow and is expected to have up to an $18.5 billion market value when it goes public.

Snap Inc. is about to offer 200 million shares for $14 to $16 apiece, far lower than valuations as recently as last November, which had the company then valued at between $20 and $25 billion.

A recently BloombergTechnology story suggested that even at $18.5B, Snapchat was at the high end of its range compared to its peers when they went public, 19.7 times forward 12-months advertising sales. Facebook was at 19.4 around the time of its IPO, and Twitter was at 13.

What slowed the momentum?

First, average daily active user growth fell below 50 percent in the fourth quarter. And, Snap posted a net lost of $514.6M in 2016.

TechCrunch recently reported that the competitive landscape for Snapchat is heating up, with the heat coming mainly from Instagram stories, but also now from new features introduced on WhatsApp.

Snapchat Stories is expected to have declined from 15 to 40 percent since Instagram Stories was introduced last August, which has now reached 150 million daily users.

Still and all, this is expected to be one of the largest tech IPOs since 2007, writes Bloomberg, trailing only Alibaba and Facebook.

So do you think some of Snapchat’s $18.5 billion valuation will disappear into the ether like its photos, or does it have legs (and enough of a moat) to fend off the competition??

A Public Snap

Tech earnings season kicked into high gear this week. A few synthesized highlights…

Apple reported $78.4B in Q1 2017 revenue, with 78.3M iPhones sold and a 19% decline in iPad sales. Apple said developers earned $20B from the App Store in 2016, a 40% increase.

Microsoft reported Q2 revenue of $26.1B, indicating Office 365 revenue grew 10% for the quarter. Microsoft indicated its Azure revenue increased 116% in the most recent quarter, “doubling usage.” Surface was down 2% YOY, Phone revenue down 81%.

Facebook reported Q4 revenue of $8.81B, indicating its mobile ad revenue was on a trajectory of bringing in 84% of all ad revenue. Their Monthly Active Users was 1.86B, up 3.91% for the quarter, and last quarter the company said it’s expecting to run out of ad space in mid-2017. It’s not clear whether this sent digital media buyers everywhere scurrying or not.

Amazon reported Q4 revenue of $43.7B, up 22% YOY, and AWS continued to chug forward growing at 47% and delivering revenue of $3.53B. AWS noted it had migrated more than 18K databases using the company’s service in 2016. Echo sales were up 9X compared to last holiday season. “Alexa, crank up the volume.”

And finally, there’s Snap (formerly known as Snapchat). TechCrunch reported their official IPO filing has their revenues at $404M in 2016 with some 158M daily users. That was 500% YOY growth, according to its S-1, but that also incurred a $513M net loss. But Snap has asserted it has a very aggressive “time spent per user” and has strong international growth in Western Europe and Australia. It also recently introduced its Ads API to widen the aperture on its advertising efforts. Its IPO is expected to be the largest tech float since Alibaba in 2014.