Snapchat loses $1.3 Bil. from Kylie Jenner Tweet

For several years, SnapChat, Inc. (SNAP) has been trying to rub shoulders with the other titans of social media (Facebook, Instagram, and Twitter). Industry experts have been luke warm on the long-term sustainability of Snap due to their inability to show sustained growth via platform monetization. With the development of Instagram Stories (which is very similar to Snap), Snapchat lost a good percentage of their predominantly teen user base which, for the longest time, has been one of the only things that has allowed them to hold their head above water amongst the sea of Billion dollar competitors.

Barely 1 year after Snapchat’s IPO hit Wall Street at $24/share (a $33 Billion company valuation), just one tweet from American reality television personality, model, entrepreneur, socialite, and social media personality Kylie Jenner regarding the recent changes to the app interface sent the stock cascading down the rabbit hole:

By the time the smoke had cleared, Snap’s stock had tumbled by 6%, tanking the company’s market value by nearly $1.5 billion in 24 hours. Jenner’s 25 million Twitter followers, 105.7 million Instagram followers, plus millions of followers on Snapchat have heard her battle cries to reverse the recent updates or delete the app. But Snapchat’s CEO Evan Spiegel isn’t keen on the idea of reverting the recent changes so it looks like the update is here to stay.

Fast forward to Thursday, March 14th when singer, songwriter, entrepreneur and actress Rihanna took to Instagram Stories to call out Snap for dropping the ball in allowing an ad that references domestic violence to exist on their platform. Below is the ad and her response:

This is what other celebrities and social media influencers are saying about the state of Snapchat now that Kylie and Rihanna have shared their two cents:

If it’s one thing that we can take away from this it’s that Kylie Jenner and Rihanna are two celebrities that you don’t start a beef with. Not long after these two stories broke, Snapchat announced that they were laying off 120 of its engineers. Their stock price, which opened at over $27/share, bottomed out at roughly $10/share shortly after and has yet to make up any ground.

Brands must be aware of the influence that social media celebrities garner and how they can work with them to retain users on their platforms. Instead of pushing these celebrities aside as “just another user,” SnapChat needs to take ownership of their mishaps and take steps towards correcting them immediately.

Making changes to a platform won’t sit well with everyone (that’s a given fact). But when a celebrity with millions of collective fans and followers doesn’t like the changes, your brand should take the opportunity to at least attempt to collaborate with that celebrity to understand what features they and their fans appreciate most from the platform. Taking your top tier users’ thoughts into consideration when making platform changes will help you retain more users and help solidify your place amongst the ranks of the top platform in your industry.

Also, the lack of addressing the negative advertisement that shamed Rihanna and other adomestic violence victims for over 4 days is unacceptable. Snapchat admitted that “The advert was reviewed and approved in error, as it violates our advertising guidelines. We immediately removed the ad last weekend, once we became aware.” This statement shows that Snapchat’s approval process is flawed importance and in dire need of being streamlined. Those in charge of the approvals need to be PR-savvy and understand the affects that a negative advertisement can have on their brand’s future value.

Does Kylie Jenner’s tweet and Rihanna’s Instagram Stories post influence your decision to use Snapchat in the future? Let’s hear your thoughts!