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Is there any digital marketing value in new breed of social apps?

Matt Kapko | April 25, 2014
The road to revenue for ephemeral and anonymous apps like Snapchat, Secret and Whisper is uncharted. How these social apps will ever achieve a level of revenue that would justify their sky-high valuations is foggy at best.

Where's the Value in Anonymity

Yuill says he sees very little runway for advertising within the framework of anonymity, however. Whisper and the latest Silicon Valley phenomenon Secret are designed around the premise that users will share more when they are unassociated with their identities and hopefully more truthful, albeit controversial with what they share.

"On Secret, if your identity is kept secret is there any real value for marketers there? I don't think any marketer wants their brand to be alongside someone talking about their sex life." — Cameron Yuill, angel investor

While he and others are fascinated by the conversations taking place on Whisper and Secret, Yuill concludes that Secret in particular is "just a huge time waster" that no brand marketer wants to touch.

"On Secret, if your identity is kept secret is there any real value for marketers there?" Yuill says. "The things that I see people responding to on Secret are generally controversial topics. I don't think any marketer wants their brand to be alongside someone talking about their sex life or that sort of thing."

A 'New Wave' of Marketing Evolution

Buch takes a more positive view, calling these anonymous and ephemeral social apps "strong identity platforms" because of their capability to match phone numbers and email addresses with actual users at the point of initial contact. "You're always logging into Secret and so they always know in a much stronger way who you are, and therefore the ways they can target you is much stronger and more compelling than the open web," he says.

"It's really a new wave of marketing evolution," Buch says, adding that he remains confident in the capability to monetize these apps once they reach critical scale and begin innovating more frequently with ad products unique to their respective platforms. "The real value is going to be down the road. It's going to be first-party data."

While the business propositions for Tinder and Secret remain fluid, Whisper is beginning to experiment with ads based on the keywords users include in their posts. For example, brands who purchase the rights to specific keywords on Whisper could encourage users to include one of their branded images as a background for their post.

Still, the inherently anonymous nature of all activity on Whisper is why Yuill and many others don't buy into this approach as a viable business model. "From a pure marketer point of view I don't see how you can move from anonymity and the sorts of things being posted. It just doesn't fit," he says. "Where's the value on each of the users if you're supposedly anonymous?"

Like other pioneers of social media that got their start years ago, each of these apps are young enough and have enough funding to focus on growing a massive audience for months or years to come.

 

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