Why Snapchat should be very worried about Instagram


Imitation may be the sincerest form of flattery, but Instagram's latest move likely doesn't feel like much of a compliment to Snapchat.

The Facebook-owned photo-sharing app just launched Stories, a new feature that looks almost exactly like Snapchat's Stories product. Both let users post photos and videos to a timeline that disappears in 24 hours.

Although it's easy to make fun of Instagram's copycat move, it could have some serious consequences for Snapchat, last valued at nearly $18 billion, as it tries to grow its fledgling advertising business.

One reason why Snapchat is so attractive to brands is that the Stories feature lets them get their message across through a full-screen, live-ish format that's much more like TV advertising than what you'd see in other social feeds.

Now Instagram offers largely the same experience, but with a broader reach and more time-tested tools.


Instagram has about 300 million daily active users versus Snapchat's reported 150 million. Instagram also makes it much easier for brands to cultivate organic followings through search and discovery.

Nike has already seen that size difference in action, saying that it got 800,000 views on a newly posted Instagram Story versus 66,000 views on its most popular Snapchat Story. Snapchat may have a higher ratio of loyal users than Instagram, but Instagram has way more users overall.

Plus, Snapchat's advertising business is still very young. The company just launched a bunch of new tools and ad products in June and looked like it was finally ready to usher in a "new era" that advertisers have been craving. By contrast, brands have been familiar with Instagram's format and tools for a long time, in particular because they're largely the same as Facebook's. The platform doesn't offer Story ads yet, but many brands have already started creating organic Stories, and it makes sense that a sponsored option will eventually roll out.

With this launch, Instagram now gives brands the best of both worlds: The live-ish content of Snapchat and the traditional static business profiles, too.

If I’m a brand and I haven’t spent time or money on Snapchat yet, I don't get it yet, now I might not feel like I have to.

Instagram's new feature doesn't spell death for Snapchat, but it certainly could slow its advertising growth at a crucial time.



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