Messaging app forecast to attract revenues of $3bn a year by 2019 by attracting hard-to-reach youth market
Snapchat could become more popular with advertisers than Twitter, Yahoo and AOL within three years, with the messaging app company forecast to bring in revenues of more than $3bn a year before the end of 2019.
That bullish forecast is based on advertisers targeting the youth audience that the disappearing photo app has seemingly cornered. More than half (51%) of video users on Snapchat are under 24, compared with 23% for Facebook and 17% for Google’s YouTube, according to Ampere Analysis.
Brands are also keen to see a true rival emerge to challenge Facebook and Google, which have recently come in for heavy criticism for their advertising practices. The two web giants currently account for 58% of the $141bn global mobile ad market.
“You often hear advertisers saying they are getting uncomfortable with such a large portion of ad spend going to just two players,” said Cathy Boyle, principal analyst at eMarketer, which produced the global mobile ad forecast. “If there can be a third or fourth player they are interested in spreading the wealth beyond the duopoly.”
Snapchat’s $22bn market capitalization is already double that of Twitter ($11bn), but it remains a minnow compared with Facebook ($393bn) and Google ($596bn).
It is undeniable that the digital darling is on to something – its users love it. Two-thirds of them check the app every day – and the average daily user visits the app 18 times a day, spending an average of 25 to 30 minutes a day sending snaps and watching messages from their friends, celebrities and advertising brands.
This level of engagement from a youth audience notorious for fickle attention has helped fuel a surge in revenues from $58.7m in 2015 to $404m last year and an expected $1bn this year.
Jay & Julia Taylor own and operate Caney Creek Studio. Caney Creek Studio is a video production, digital marketing, and social media management agency.