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Snapchat Case Study: A Decade of Growth

Updated: Jul 3, 2023

Snapchat's Success: A Unique Business Strategy and A Decade of Growth

Business Profile

Snapchat, originally called ‘Picaboo’, was founded in 2011 by three Stanford students Evan Spiegel, Reggie Brown, and Bobby Murphy. Their main premise was to build a social media platform that offers users the unique advantage of their ‘chats or snaps’ disappearing automatically after a preset period, forming a key part of Snapchat's Business Strategy.

Due to differences in thinking early in their business journey, Spiegel and Murphy took Brown out of the company, finally reaching a mutual settlement in 2014. After a decade in operations, Snapchat, demonstrating a resilient and successful business model, is now led by Spiegel as the CEO. The parent company Snap, Inc has gone public, with the two partners owning around 95% of it.

Defining Traits

With business stories, especially stories of quick success from the get-go, we see a similar pattern. Any good tech business boldly aims at solving their customer’s pain point that needs immediate attention. In 2011, with social media on the rise, one of the greatest concerns amongst users was that their conversations and posts would live forever on the internet. Here's how Snapchat succeeded: it came into operation simply to address this concern, creating an environment in which ‘chats or snaps’ mimicked in-person conversations that don’t leave behind a trail of evidence on the internet.

Over the decade, Snapchat’s business model has developed in new directions, such as stories and filters, both of which have been blatantly copied by larger social media companies like Facebook, Instagram, and now Youtube, which is currently rolling out its stories feature. This Snapchat case study reveals how imitation of their ideas has sometimes hindered Snapchat's growth. Still, they can take comfort in being pioneers in their industry.

One of the most defining parts of the Snapchat story is that in the fast-paced tech world where acquisitions and mergers are often the only way for smaller players to survive, Snapchat, demonstrating a unique business model, waved off offers from social media giant, Facebook, in 2013 and avoided being acquired.

The reality is that with tech giants, Facebook and Google, running most of the social media verse, one would think that Snapchat, despite its distinct business strategy, is dying out as a smaller player. But this isn't how Snapchat succeeded. This resilient company continues to provide value and increase its base of loyal users. In the fourth quarter of 2020, Snapchat boasted 265 million daily users with a global reach in North America, Europe, and other parts of the world.

Key Takeaways

This Snapchat case study is unique. Before the turn of the century, a start-up was seen as something that is created, nurtured, and grown over years, with care and understanding of market trends. But with the advent of the tech world, especially the emergence of new social platforms, many start-up businesses were created for the sole purpose of someday being acquired for a hefty sum.

Snapchat's business strategy makes it stand out. By neither being acquired nor getting into an acquisition game of their own, the company has shown itself to be a trendsetter that is often copied by competitors. Snapchat is a creative business with a focus on its customers and their product, playing the long game, something that remains an underlying value of a good business.

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