Snapchat Looks to Acquisitions for Growth

To say that Snapchat's growth prospects have looked somewhat darkened would probably be an understatement. The one-time unicorn of tech just wrapped up its second-ever earnings on Thursday missing analysts’ expectations and reporting slower than expected daily active user growth = no good. Add on top of this that Facebook's Instagram is constantly copying Snapchat's innovation and the picture gets dimmer. BUT, is there still light at the end for this fading star? Perhaps. With a few recent acquisitions Snapchat may be pivoting/repositioning itself in much the same way Foursquare did to move from being a check-in app to a location data-collection manager with a social element. Which means not only will advertisers know where their key consumer is but also how they may be interacting with their brand and if not how to seamlessly introduce their brand in the path-to-purchase. The first of these acquisitions that points Snapchat in this general direction was Zenly, a French start-up acquired for $213.3 million. Zenly allows consumers to see where their friends are on a map. Snap seems to have easily integrated this into the core business by launching Snap Maps, a new feature that allows users to share their location within the app. Given that most tech acquisitions have a history of failing the fact that Snapchat made this acquisition and was then quickly able to pivot to leverage it as a part of their core business shows potential longer-term thinking. The other acquisition was Placed which Snapchat purchased for $135.2 million in cash. Placed provides Snapchat with a valuable tool in its arsenal (and the sacred grail for advertisers) to help advertisers know if their digital ads actually influenced a consumer to take action (i.e.: at least go to where they could buy the advertisers product). ‘Course even with these steps there’s nothing stopping Facebook from building the same technology in-house or going out and making a similar purchase to again mimic Snapchat. What do you think? Is Snapchat moving fast enough to stay ahead of a constantly copying competitor in Facebook’s Instagram? Is what Facebook doing equivalent to Microsoft during the Browser Wars (spoiler: it did not end well for the losers aka Netscape, AOL..etc).