‘We can do better’: Snapchat to target millennials after missing goals

Snapchat is coming for the oldies - in Gen Z terms, at least. The messaging app is focusing on attracting users in their 30s, according to a leaked memo from its co-founder and chief executive, Evan Spiegel, as part of a goal to increase usage "in at least one new large country or demographic".

In the memo, published by the Verge, Spiegel laid out his company's plans for recovery after a year in which 20% of Snapchat's staff were laid off, and four of its five stated goals missed. "While the macroeconomic environment certainly contributed to these misses, I believe we can do better," he wrote.

Attracting new users is part of the goal to grow Snapchat to 450 million daily active users by the end of next year. The target isn't just millennials, though. Snapchat is also focusing on a "big five" list of large countries with low penetration: Mexico, Brazil, Italy, Spain, and Japan.

Spiegel wrote: "This will require significant coordination and accountability across our communications, marketing, global brand experience, growth, product, and market development teams in addition to many other teams.

"We will need to be more clear and deliberate about what Snapchat is (a visual messaging app that enhances your relationships with friends, family, and the world) and why people use Snapchat (self expression without fear of judgment). In contrast to social media popularity contests, Snapchat is a refuge where you can express yourself, live in the moment, learn about the world, and have fun together.

"We have found that consistently delivering our core product value of visual communication with friends and family drives some of our most durable and effective user growth."

Almost half of American Snapchat users are under 25, and a third of the rest are under 35 - with that demographic skewing towards the younger end of the range. The company's growth has been affected by the rise of TikTok, but it retains a strong base among younger users who treat it as a messaging app rather than a fully fledged social network.

The company has had some success winning over users through other offerings, however. Its augmented reality "lenses" have been converted for use on desktop videoconferencing software, and experienced a boom in popularity thanks to the rise of video calls during the pandemic.

Snapchat entered 2022 with goals including 400 million daily users, breaking even on net income, and "grow our team". In the end, it failed to achieve these but was successful in its goal to grow "trust", specifically to "protect our community from harm, safeguard privacy, promote health and wellbeing".

"Our shortcomings this year have had significant consequences, not least of which is a 75% decline in our stock price year to date," Speigel said. "Before 2022, massive fiscal stimulus and years of ultra-accommodative central bank monetary policy created an environment that rewarded revenue growth at nearly any cost. Today, the cost of capital has increased so dramatically that our business will be valued based on our ability to generate profits."