By Shreya Jois, Partnerships Intern
On February 21st, 2018, Kylie Jenner finally showed that she could not only influence Gen X consumers but also stock brokers. Her single tweet causes Snapchat’s stock to quickly lose over $1.3 billion dollars in market value. Rihanna followed suit just a week later after a controversial “Would You Rather” ad ran on the platform, pitting her against Chris Brown. Her tweet lead to a cool $800 million dollar decline. In the current days where a single tweet can hold quite a bit of power, both of these cases demonstrate just how vulnerable a platform like Snapchat can be to just a click of a button.
All these tweets and stories ask the same question: is leaving your stock in the hands of Social Media influencers and Gen Z opening yourself up to too much vulnerability? Snapchat’s demise clearly shows that the profitability of Gen Z has its downfalls. Kylie Jenner’s 140 character statement shows us that basing your audience solely on the youngest, most tech savvy demographic might be a goldmine for advertisers, but maybe not so much on Wall Street.
One tweet might not put the tech company out of business, but it is undeniable that celebrity social influencers have a stronghold not only on Snapchat’s growth, but also on its user demographic, which is the core of why advertisers are driven to the platform. 53% of Snapchat’s users are under the age of 34, and more specifically 83% of their user penetration rate is between the ages of 12 to 17. Although it is reported that this new update was an attempt to appeal to an older audience, it created the unintended cost of being despised by many of its younger central users.
It is easy to make projections that this new roll-out and backlash from multiple influencers across Twitter might boost up Snapchat’s biggest competitor to date, Instagram, while leaving Snapchat in the dust; however, we cannot be too quick to judge. As the prime user base for many of these platforms, Gen Z, grow-up and adapt to new technologies, and social media influencers grow to even larger proportions of celebrity in their own right, Snapchat might be able to make a comeback with their prized user demographics.