On Snap's (NYSE:SNAP) first public earnings call, CEO Evan Spiegel derided rivals that "growth hack" their user numbers, referring to various ways to prod users to remain engaged. In this segment from Industry Focus: Tech, Motley Fool analyst Dylan Lewis and senior tech specialist Evan Niu, CFA, discuss Snap's own methods to keep users on the platform.
A full transcript follows the video.
This video was recorded on May 12, 2017.
Evan Niu: Speaking on user numbers, Evan Spiegel had this really weird comment on the call about how, "Our rivals are doing what we call growth hacking," which is when you send people notifications, and prod people into using the app and getting their friends to use the app. He was kind of saying this in a bad way, like, "We're not going to resort to those types of methods to try and grow user numbers." But, it's like, why is that a bad thing? Everything these companies do, all of them, is meant to increase engagement on the platform. Why is it a bad thing when a company is experimenting in different ways to try to get their users engaged, get their users to grow their own network of friends on the platform? Those, to me, are just regular things that a company should be doing to increase engagement. Yet, Evan Spiegel is trying to downplay, and say, "We're not going to do that." It was a really bizarre way to frame that, when you would think that a company like Snap that's trying very hard to grow users would consider experimenting with some of those types of things. It was just a weird comment to make.
Dylan Lewis: And, also, to put the platform under a microscope for a minute, I don't know if you use the messaging side of Snapchat at all, or if you're more on the story side with your posts, but if you wind up actually sending each other messages to friends back and forth on the platform, you get a notification that your friend is typing a message. Are there any other platforms where you get that notification? That is absolutely a push to get people playing on the platform or, and to give people a heads up.
Niu: Yeah, exactly. I wasn't aware of that because I don't really use the platform. That's kind of crazy, because that sounds exactly like what he's talking about, which is sending you little notifications and prodding you to stay in the app, stay engaged.
Lewis: And I see that and I don't need that. Just tell me when I actually have the message.
Niu: [laughs] Yeah, that's a weird notification, that someone is typing. Of course, a lot of time on messaging platforms, you see when people are typing. But a notification that someone is typing does seem kind of annoying.
Dylan Lewis has no position in any stocks mentioned. Evan Niu, CFA has the following options: long January 2019 $20 puts on Snap Inc. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.