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Instagram Stories has brought Instagram and Snapchat into direct competition.
And while Snapchat has the cachet of being the originator of the Stories format, the closed nature of its platform means that it lacks the same network effects as Instagram. If Snapchat wants to succeed against Instagram in the long-run – in both the domain of ephemeral sharing and more broadly in social media – then it might need to take a leaf from its rival's Instagram page and emulate the open-nature of its network.
Network effects cause a product's value to compound as more users buy in. Every successful social platform (including Snapchat) owes its prosperity to network effects. As more users sign up, there are more people to connect with and more content to interact with.
This increases the benefits of being the platform, which keeps existing users on platform and attracts new sign ups. On the other hand, flailing social networks fall short because "they never caught on" and hit critical mass, while extinct social networks die out when no one uses their platform anymore.
The openness of Instagram's platform and its superior user base give it a key advantage over Snapchat. Instagram counts over 300 million daily active users (DAUs), almost double that of Snapchat. Users on Instagram can thus potentially tap into a much larger audience. Moreover, Instagram's platform is open and encourages the discoverability of new content, which helps the audience-building endeavor. In contrast, Snapchat's is more closed and difficult to find content on unless you already know exactly where to look.
These are the specific factors that lead Instagram to have stronger network effects than Snapchat:
- Search functionalities to find friends and content. Instagram lets users search by people, tags, and places, and will display a list of results that users can then explore. On the other hand, Snapchat only lets users search for other accounts, and displays results that include the exact strings that are typed in. This means that adding another user on Snapchat requires you to know their exact user name. Meanwhile, Instagram also has other built-in features to encourage the discovery of people you might know. For instance, you can explore a user's profile, see who they follow, and all the people who follow them. And new users on the platform, or those not following a lot of people, will also see a tab at the top of their feed suggesting people to follow. Snapchat on the other hand does not allow users to explore each other's profiles in as deep a manner, nor does it include features to help the discovery of other users within your network.
- Discovery portal to find content from regular users. Instagram's search tab also highlights trending content, posts that you may be interested in, and a tool to discover people who are either in your network or whose posts are similar to content you've engaged with in the past. Snapchat, on the other hand, does not have any features of the sort. Its Discover section only displays content from brands, publishers, media companies, or Snapchat's editorial team, but nothing from regular users. Further, posts on Snapchat are for the most part only broadcasted to friends (unless they serendipitously make it on to the public-facing Live Stories feed), but adding new friends on Snapchat can be complicated, as explained above.
- Greater ability for content to go viral organically. Instagram's platform encourages the growth of viral content, via its trending section, and via liking and commenting from users within your network. Snapchat on the other hand lacks tools to highlight and share viral content. Its Discover section only features content curated by editorial professionals, and there is no seamless way to share snaps, making it it hard for content to go viral on Snapchat in the traditional sense. Consequently, most Snapchat content that goes viral on the internet does so after being reposted to other platforms, like Facebook and YouTube.
- Huge, preexisting followings on the platform. Some brands already have massive followings on Instagram, and building a similarly large audience on Snapchat would require significant time and effort. For example, Nike has over 58 million followers on Instagram, and recreating a same-size audience on Snapchat right now would require it to capture about a third of Snapchat's total DAUs. In a similar vein, Nike's post on Instagram Stories already easily break 800,000 views, whereas its best-performing video on Snapchat only got 66,000 views, according to Ad Age. For this reason, some brands might hesitate to set up shop on Snapchat, and the introduction of Instagram Stories will further help to stem the flow of brands from Instagram to Snapchat.
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