Snapchat stocks are making a slight rebound following the app redesign controversy that had upset their fan base.
Did Snapchat sell out?
Snapchat faced major backlash late last year when they introduced a new redesign to their popular social media app. The redesign put a higher priority on celebrity and advertiser media, leaving loyal users with a bad taste in their mouth. The app’s demographic, mainly teenagers, has stuck with the app, yet stock prices tell a different story.
After going public in March 2017, share price launched at around $24 and was expected to perform well, yet eventually disappointed in the coming months. The aforementioned redesign didn’t do much to alleviate stock worries, with even some celebrities such as Chrissy Teigen speaking out against the change. Yet, even with the amendment to the app announced, Snapchat CEO Evan Spiegel continues to defend the company’s original decision, attributing the backlash to the design being too “bold” for users’ tastes.
A crowded market
The social media market is very competitive, and with other platforms such as Facebook and Instagram duplicating Snapchat’s “story” feature, the image and video sharing app was already fighting an uphill battle. Instead of sticking with what works for them and their users, they decided to introduce a change that conflicts with the essence of social media itself, thus downplaying the social experience and giving the impression that Snapchat has sold out to cash in on advertiser money.
As of this writing, the stock price of the company is resting at $11.39, marking a 7.37% rise from Tuesday. Its current value however puts it at about a 50% decrease from this same time last year.
Citron Research is forecasting a purchase of Snapchat by the end of the year, with a potential share sale price of 17$.