Investors value Snapchat’s millennial following

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Snapchat went public on Thursday this week listing on the New York Stock Exchange, we’re going to take a quick look at the numbers, but if you’re not interested scroll down to find the 7 Top tips to start selling on Snapchat that we promised you.

From an initial offering of $17 a share, Snapchat soared to $27.07 by the time the markets closed on Friday. To put this into perspective, their market cap is 24 times bigger than Etsy, 2½ times as much as Twitter and are already worth over ¾ the value of eBay. They do lag behind Facebook ($394.51B) and Amazon ($403.56B), but these companies are literally off the chart.

Snapchat has more users than Twitter, latest numbers are 161 million daily users (compared to 141 million for Twitter. About 60 million users are in the US with around 10 million in the UK. What’s attractive to investors and advertisers alike is that the majority of these users are young – not teenagers but in the 18-24 year old bracket. These are users who hardly ever watch live TV preferring to watch catch up TV online, Netflix or YouTube. They spend up to 30 minutes a day on Snapchat spread opening the app up to 18 times a day.

Snapchat make money selling adverts, but they still lost $515m last year. The IPO prospectus points out that they may never become profitable or if they do it could be a struggle to stay in the black. We’ve seen this before though, Amazon hasn’t a track record of turning in profits but investors flock to them for growth.

Today in the western world, marketplaces still rule ecommerce, but in countries like China and Japan selling on social media is huge. Today, for a small business, I’d probably recommend Facebook as your best option for social selling – Twitter doesn’t appear as successful to date. Snapchat is one to watch for the future but there’s no reason not to get started today. Consider how you can build an engaged audience on Snapchat, it isn’t easy but read our post “7 Top tips to start selling on Snapchat” for some ideas to get started.

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