Snapchat Isn’t Having Fun Anymore

Think you’re having a bad week?

You’ve got nothing on Snapchat. The company has been battling issue after issue this week, making for what is probably their worst 7-day period in the company’s short history.

What Happened

First of all, Snapchat started the week with a global outage. Not what CEO Evan Spiegel wanted to see when he came into the office Monday morning. The service was down worldwide for an entire four hours – an eternity in the social world. Users were quick to notice and take to other social media platforms to announce their displeasure.



After recovering from their outage, they entered what I’ll call, “Disaster #2” of their terrible week. On Tuesday, the company reported their earnings at 4 PM. The numbers, needless to say, were not good.

First, the user numbers. Snapchat reported that 4.5 million new users had joined the platform in the past quarter, which may sound good – but it’s not. They missed estimates, and compared to quarters in 2016 when they were growing by 21 million users, 4.5 million seems extremely minimal to investors.

Second, came the revenues. Snapchat reported a 62% increase in revenues, which again is just not up to snuff. They missed estimates by about $30 million for the quarter.

Third, was the losses. The company reported over $400 million in losses, which are growing way faster than revenues. This has scared investors. When they took all of Disaster #2 into account, many sold off the stock. Snap was down 20% in after-hours trading on Tuesday.

Finally, Disaster #3 of the week from hell for Snapchat.

Evan Spiegel has long held the view that if a user can’t figure out how to use Snapchat, they shouldn’t use it. It’s awkward, clunky user interface has often been noted by tech community as a way to keep older generations from using the platform. When everyone’s parents started joining Facebook, the platform became less “cool”, and this was Snapchat’s attempt at keeping their audience young.

Now that they’ve gone public, Snap can no longer afford to hold this view. This was made clear on the post-earnings conference call. Speigel noted that the app would undergo a full redesign to make it easier to use, more intuitive, and more personalized to each user. The introduction of algorithms (similar to what Facebook and Twitter use) in the Stories section was also discussed. These are huge moves for the platform that has rarely bent to public opinion.

It appears that is changing.

I’m sure this is eating Evan Spiegel up inside, but so comes the risk when you go public. It will be interesting to see where Snap goes from here – stay tuned.

If you want to hear more on Snapchat’s bad week, plus all of the week’s latest marketing news and trending ads, be sure to listen to the Mind Your Marketing Podcast. Jordan Scheltgen and I publish new episodes every Wednesday – check us out wherever you listen to podcasts.