Jun 21, 2022 - Economy

Snap CEO endorses Elon Musk's "super app" strategy

Photo credit: What's New in Publishing

Snap Inc. co-founder and CEO Evan Spiegel on Monday endorsed Elon Musk's plans to turn Twitter into a "super app," or an app that provides multiple services in one mobile interface, citing Snapchat's own ambitions in that arena.

Why it matters: While some tech companies build or acquire separate apps for different services across their portfolio, like Meta or Google, Spiegel said, "We see the power in diversifying engagement across our service."

  • "[W]hen you've diversified engagement across a wide variety of products in the same application, that can really strengthen your business," he said.

Driving the news: In an interview with Axios at the annual Cannes Lions advertising festival in France, Spiegel noted that while he's learned "not to predict" Musk's strategy, "when he talks about Twitter as a super app, I think that's an idea that's really compelling."

  • "I think he's seeing a lot of what we saw in Asia, for example, and a lot of what we've tried to build."

Between the lines: Musk's $44 billion Twitter takeover effort has been viewed with skepticism by some who think he won't take the job seriously or isn't actually interested in completing the deal, and optimism by others who believe in his values or ability to revolutionize the product.

  • Spiegel sounded bullish.
  • "Twitter is clearly something that's close to his heart, something he really enjoys using, and he's got a ton of ideas about how to evolve the product."

The big picture: Spiegel described for the first time publicly the company's long-term plan to build a Snapchat "super app," a strategy championed by Tencent in its creation of the widely successful super app WeChat. (Tencent took a 12% stake in Snap Inc. in 2017.)

  • "[I]f you look at the evolution of Snapchat, [it's something] we've been investing a lot in, over the years," he noted.
  • In addition to disappearing chats, Snapchat also features a map where users can track their friends in real time, curated entertainment content, games and augmented reality lenses. Those products exist in different tabs within Snapchat's main user interface.
  • If the company can continue to attract more users through its communications tools, "then I think they'll get to know the rest of our products, or, you know, the Snapchat Super App, but we just tried to stay focused on that core," he said.

By the numbers: Snapchat in April said it has 330 million daily active users, meaning a little less than half of its 600 monthly users have made a daily habit of opening Snapchat every day.

  • But while the company has more than 100 million daily active users than Twitter, it made less ad revenue than its Big Tech peer in 2021.
  • Spiegel acknowledged that sometimes Snapchat faces challenges making its ad product relevant for brands that want to be able to target people specifically online, but said the company has never allowed individual targeting and instead offers advertisers the opportunity to target users with aggregated data.

What's next: Spiegel said the company plans to release new usage metrics for its new TikTok-style video platform called Spotlight, during its next earnings call.

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