Snap Is a Small Fish in a Large Digital Advertising Pond
Snap is the parent company of Snapchat, a widely used social media app with over 450 million daily active users. While the application is free to use, Snap makes money by allowing advertisers to promote their products via ads on its platform. While the firm’s ad inventory has steadily increased over time, with advertisers able to promote their products through photos, videos, and augmented reality features, Snap has been unable to effectively monetize its user base, and we believe its ad-targeting and user-engagement algorithms are less potent than larger social media players such as Meta and TikTok.
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