Snapchat's Impact On Consumer Behavior

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On February 6th of 2017, The Wall Street Journal reported that the social messaging app Snapchat was planning on filing for an initial public stock offering (IPO). Snapchat was determining the current worth of their company and it was between $20 billion and $25 billion (Seetharaman). However, Facebook and Facebook’s app Instagram have recently been ripping off many of Snapchat’s signature features, which is troubling for Snapchat considering its “growth in daily active users . . . is slowing” (Seetharaman). Both Snapchat and Facebook are going after the same demographic, teens and young adults. According to The Wall Street Journal’s, Deepa Seetharaman, there are many features on Snapchat that appeal to this demographic, which Facebook and …show more content…

The theory of consumer choice suggests that people make choices to gain the most satisfaction that they can in a state of scarcity, with the opportunity costs and alternatives that they deal with (Espinoza and Dolan 115). Consumer choice consists of objectives and “constraints that shape the opportunities available to consumers” (Espinoza and Dolan 116). Regarding objectives, an economic term called utility is involved, which is “the pleasure, satisfaction, or need fulfillment that people obtain from the consumption of goods and services” (Espinoza and Dolan 116). In this article from The Wall Street Journal, it talks about the features and structure of Snapchat, which greatly appeals to a younger demographic and how Snapchat gives utility to consumers. When Snapchat is compared to Facebook and Facebook’s Instagram app, Snapchat is considered a more authentic network because it promotes candid and informal posting. It is also an easy app to use, which is another reason why this group of consumers age 35 and under gravitates to Snapchat (Seetharaman). In a diagram created by Facebook, they compared the amount of steps users needed to complete to post on Facebook versus Snapchat, “It took nearly twice as many steps to post on Facebook as it did

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