It will be awfully hard for Snap Inc.'s Snapchat to ever beat Facebook when it comes to scale. Facebook-owned Instagram, just one piece of Mark Zuckerberg's global empire, boasts 400 million daily active users. Snap, in contrast, has just 158 million daily active users—and indicated in its IPO prospectus that user growth may slow in the year ahead.
But what Snap lacks in quantity, it makes up in quality—or at least that is the argument that the company wants Madison Avenue to hear. Users younger than 25 are spending over 30 minutes on Snapchat every day, and users over 25 are spending 20 minutes on average. All users, on average, visit 18 times per day. That depth of engagement, Snap suggests, should be extremely valuable to advertisers.
Of course, if that level of engagement were to drop, Snapchat could start to look remarkably like a different social media company that was once an IPO darling—Twitter. AOC