Snap stock falls as Kylie tweets, but banker ratings are in the mix too
At this point, if you haven’t accepted the celebrity influence of the Kardashian/Jenner machine, you probably haven’t been paying attention to pop culture at large. Snap is definitely paying attention. Yesterday, Kylie Jenner tweeted a pretty brutal takedown of Snapchat with the nonchalance that only a celebrity who has mastered social media better than most can do.
The words were significant not only because of who was saying it, but because it fits a pretty clear narrative that Snap is slowly losing its bread-and-butter users to Instagram and that its controversial redesign has alienated the core who were still holding on. It’s also important because Snap’s stock has had a rough week on Wall Street after Citi downgraded the stock Tuesday in response to some of the blowback to the redesign. Snap’s stock price is down 8 percent today.
“While the recent redesign of its flagship app could produce positive long-term benefits, the significant jump in negative app reviews since the redesign was pushed out a few weeks could result in a decline in users and user engagement, which could negatively impact financial results,” Citi’s Mark May wrote Tuesday.
Even though Snap CEO Evan Spiegel voiced that the company was anticipating some blowback from the app’s redesign, things have still been a bit of a disaster with the company being forced to respond to a Change.org petition decrying the redesign that currently has more than 1.2 million signatures. This PR nightmare has had negative impacts on the company’s business, as well.
Kylie Jenner is just about as influential a celebrity as they come; many of the product advances of social media companies like Snap have been borne on the backs on influencers like Jenner, who have hundreds of millions of followers across these platforms that she uses to push her makeup products and lifestyle onto culture.
Snapchat’s advantage has always been that it’s been a bit of a youth-centric enigma; investors have assumed that the audience of DAUs that it has in its back pocket is the most highly valuable demographic of young, loyal users. It turns out that after a divisive redesign, people are discovering that the kids aren’t alright with change and that they are just as aware of the creeping sense of stagnation as everyone else.
After sending a tweet that signified Snapchat hadn’t done anything to hold her attention, Jenner went one further, basically signaling that the app was a point of nostalgia for her now. As my colleague Jon put so succinctly, “Live by the influencer, die by the influencer.”