Data interpretation of Snapchat: 1 user contributes $0.9 in revenue per quarter

Snapchat is an interesting and fun app that is very popular among young users in Europe and the United States. Its main features are self-destructing messages and rich and fun filters. The company calls itself a camera company. With its innovative functions and gameplay, Snapchat is undoubtedly a young social unicorn. Its Snapchat, which has attracted much attention, has attracted hundreds of millions of young users and successfully transformed from a tool product to an application with certain social attributes. Investors who bought Snapchat stocks at high prices also expect that one day Snapchat will be able to overthrow Facebook and become a national social giant.

So how is Snapchat's user growth? According to Snap's financial report for the first quarter of 2017, Snapchat's daily active users reached 166 million, and the number of Snaps (short videos) sent per day reached 3 billion, an average of 18 per person, compared to 2.5 billion in the third quarter of last year.

Snap's users are mainly distributed in Europe and the United States, with 71 million daily active users in the United States, accounting for 43%; 55 million daily active users in Europe, accounting for 33%; and 40 million daily active users in other markets, accounting for 24%.

The European and American markets are currently also Snap's main source of revenue. According to the company's financial report, in the first quarter, the U.S. market accounted for 86% of its revenue, reaching US$129 million, while Europe and other markets contributed 9% and 5% to its revenue, respectively.

The difference between revenue share and user share indicates that the commercial value of users in different regional markets is different. On average, Snap can earn $0.9 from each user every quarter, including $1.81 from each user in the U.S. market, $0.24 from each user in the European market, and $0.19 from other markets. In contrast, Facebook earned an average of $4.07 from each user in the first quarter, which is 4.5 times that of Snap. In the U.S. and Canada, Facebook can earn $16.46 from a single user, which is nearly 9 times that of Snap. Snap's lower per capita revenue contribution than Facebook shows that there is a lot of room for future growth, and also shows that there is a gap between Snap's monetization level and Facebook.

Since Snap's video business is a bandwidth-intensive business, in order to serve users, Snap spent an average of $0.6 per user in the first quarter.

After recognizing the threat from Snap, Facebook has begun to aggressively develop its own camera filter function. Facebook has become an AR camera in a high-profile manner. At the same time, FB has also added short video sharing functions such as "My Story" in various flagship applications to snipe Snap's rise. Will Snap be crushed or can it rise against the trend? Just like the question that domestic social entrepreneurs have to think about, what would you do if Tencent did it? The problem facing Snap is what would you do if Facebook did it? Where to go, let's wait and see.