Snapchat parent Snap, Inc. SNAP in late May warned of a shortfall in the second quarter, citing deterioration in macroeconomic conditions. This was seen by some as reflecting a broader industry-wide malaise.
Loup Funds Managing Partner Gene Munster offered his take on the state of social media, based on his interviews with summer interns at his firm.
TikTok Is King: TikTok has clinched with the 15-60 second video format, which has become addictive, Munster said. This is because a social media users need not wait for the punchline, he added.
The analyst sees committing to a 15-second video is easier than committing to a 20-minute video.
“The irony is that while the initial commitment is less, total time spent ends up being more,” Munster said.
Although Meta Platforms Inc’s META Instagram Reels and Alphabet Inc’s GOOGL GOOG YouTube Shorts have the same format, TiKTok reigns supreme due to the depth of its content, the analyst said.
YouTube and Instagram, according to the analyst, have loyalty, which they are building on for their short video features. The analyst also noted that youngsters hooked to TikTok are not worried about the Chinese government potentially having access to their user information.
Facebook & Snapchat Losing: The younger generation use Facebook and Snapchat as the “stay connected apps” but use these less frequently, Munster said. The only use cases for Facebook are for briefly checking in on family content, getting groups of friends together occasionally, and buying or selling on the Marketplace, he added.
Snap usage, the analyst said, has declined over the past two years, in part, because Instagram copied many of Snapchat’s features.
Instagram For Staying Connected: Instagram has become the new “staying connected” app, specifically for college students, taking on the mantle from Facebook and Snapchat, Munster said.
“The visual aspects of Instagram have made it a quick and entertaining way to keep up with friends,” the analyst said.
Twitter, Metaverse Afterthoughts: College students use Twitter, Inc. TWTR less as they are less focused on news and more focused on gaming and social, Munster said.
The analyst said he thinks this wouldn’t hurt Twitter much, given students are not among the platform’s core focus.
The youth were indifferent about the metaverse, but they were excited about its potential as the internet 2.0, the analyst said. In the near-term, the metaverse still lacks the definition needed to generate excitement, he added.
“The bottom line: they can’t get too excited about the metaverse because they don’t really know what it is, and that awareness is going to take years to develop,” Munster said.