Originally created with the intent of allowing people to freely express themselves socially without having to worry about the repercussions of a traceable history, Snapchat has evolved from a personal application used to send food pictures and selfies to a fully fledged business.

Users are able to share pictures for a duration of 1-10 seconds, after which the images are unable to be viewed anymore. In the future, Snapchat also introduced the feature known as “stories”, which allows an image to be viewed by everyone on one’s contact list for a full 24 hours. This gave users the chance to show off what they were doing that day to a wider range of people for a longer period of time, all while still being “temporary”.

The story is what sparked the business. This led to businesses such as CNN and MTV to create channels, broadcasting stories to people subscribing to them. These stories were used to present a more “candid” look at the business, and quickly became an advertising platform. Live events also took part in this, showing snippets from live concerts and award shows that were shown to all users. Due to its large reach and easy consumption, this option became widely popular and became one of Snapchat’s main form of income. With each view costing approximately 2 cents, Snapchat’s reach caused these ad spots to reach into the tens and hundreds of thousands.

Snapchat is an example of a small idea with simple execution opening a brand new door for advertisement in a way that nobody ever imagined. Despite its high costs, users opting in to viewing multiple ads from a company sounds almost too good to be true for some businesses.

Sources:

http://recode.net/2015/06/17/snapchats-making-some-pretty-serious-money-from-live-stories/