As part of efforts to expand its subscription program, the Snapchat virtual platform plans to test the Friends & Family Plan shortly.
These intentions are a reflection of the global trend for social media platforms to search for monetization methods that are not related to advertising.
The code inside the Snapchat app suggests that the mentioned company will soon add a new Friends & Family Plan. This social media platform is currently popular among representatives of Generation Z. A new tariff tier will be added to the Snapchat+ subscription program, under which users, subject to a monthly fee, get access to exclusive, experimental, and preliminary features.
The firm’s subscription business is showing a trend of rapid growth. The parent company of Snap, in a letter to investors that accompanied the financial statements for the third quarter of 2023, reported that the number of Snapchat+ subscribers as of the end of September was more than 5 million people. In July, this figure was equal to 4 million users.
The company’s revenue from Snapchat+ in the third quarter showed an increase of more than 250% year-on-year. This indicator is a convincing confirmation that consumer demand for the format of interaction with the virtual platform within the subscription programs is increasing.
The letter to investors notes that the company continues to diversify its revenue base with Snapchat+. Also, the firm stated its commitment to implementing efforts aimed at increasing the number of subscribers. Moreover, the list of the company’s main tasks for the near future includes the improvement of retention and the launch of new and innovative functions.
At the same time, the share of subscribers in the structure of the total number of Snapchat users is insignificant. Co-founder and CEO of the company Evan Spiegel, in an accompanying earnings report, told analysts that in the third quarter, the daily number of visitors to this social media platform was 406 million people. According to him, the share of paid subscribers of the app is only 0.01% of the daily active audience.
Experts say that the creation and implementation of new tariff plans in the social media industry is due to the desire of the owners of the respective platforms to increase revenue. In this case, the companies also aim to make users more active in making various purchases in their apps. According to the results of a special study, it was found that out of 3,000 respondents in the United States, only 8% showed the mentioned commercial activity on Snapchat.
Achieving the goal of increasing advertising revenue has been made easier thanks to artificial intelligence. The use of AI tools expands the advertising capabilities of social media platforms. Machine intelligence individualizes the relevant proposals, taking into account the interests and needs of users.
Switching to a paid subscription in the social media industry has become a general practice. For example, Elon Musk, the owner of X, formerly known as Twitter, announced the intention to offer users two-tiered premium subscriptions. TikTok is currently testing a tariff plan that provides for a monthly fee and no advertising. Meta has announced a new ad-free subscription option in Europe.