While Snapchat’s growth has stalled, and even shrunk in the U.S. and Europe, there is one key region where the app is growing. The app just reported that its user base in India continues to expand, while it’s also steadily growing its local ad business there.
As per the company: “Snapchat today announced strong advertiser momentum in India, with the number of advertisers on the platform growing 10x over the past two years while the number of advertisers spending across all four quarters has tripled.”
Snapchat said that rising adoption of immersive ad formats has helped to drive more opportunity in India, while the app’s continued investment into AI-powered targeting and platform capabilities has also helped to boost performance and subsequent interest.
Snapchat currently serves more than 250 million monthly active users in India, making that the app’s biggest regional market. The platform’s focus on close connection, as opposed to sharing in public, is clearly resonating with users in India.
The challenge for Snapchat has been that, traditionally, it doesn’t generate anywhere near as much income from India as it does from the U.S. and EU, which has meant that its growth in the market is less beneficial for the bottom line, and is more of an indicator of future potential.
But the improvement of Snapchat’s ad business in the region provides additional hope that it can become a key revenue market by providing a valuable way for young audiences to connect, and subsequently driving appeal to local promoters.
Indeed, Snapchat said that while Generation Z pays up to 34% less attention to ads on conventional social platforms compared to millennials, Snapchat “continues to drive strong engagement and measurable business outcomes for brands,” with its campaigns outperforming other platforms in terms of brand recall and awareness.
That could entice more India-based businesses to look to the app for their promotions, which could make Snapchat a more valuable, viable business.
Though even with this relative success, the challenge before Snapchat remains significant.
Because even with this noted growth in India, Snapchat’s overall audience is still shrinking, which means that the app will need to focus on expanding its ad inventory in order to maximize its revenue intake.
Snapchat users have seemingly responded well to inbox ads, which were a big risk for the platform. However, there will be a limit on how many promotions users can take before their experiences on the platform become significantly disrupted by this push.
If Snapchat can’t keep pumping in more ads, then building on its opportunities in developing regions is its next best bet, which makes its growth in India a key consideration for its future.
