Snapchat and its parent company Snap Inc. have taken another major hit as their stock prices dropped yet again this past Tuesday. This drop was the result of Snapchat's user base growing less than had been expected, and it appears to be making investors nervous. This isn’t the only problem that Snap Inc. has faced recently, but plans for a massive overhaul are in the works.

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Snapchat is one of the most downloaded applications for Android and iOS with a reported 100 million daily users in 2016. It is hard to imagine that such a successful application could be losing support and funding so rapidly, but Snap Inc. CEO Evan Spiegel has taken the blame. Spiegel publicly addressed the company’s shortcomings and made it clear that it could not continue on this way, and that major changes are needed. This came after a streak of disasters for Snap Inc. where their lead engineer stepped down, the company lost $443 million and the Spectacles idea was written off as a failure with $40 million worth of the product sitting unsold. It is now understood by Snap Inc. and the public that a redesign is absolutely warranted.

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Snap Inc. is now looking into adaptations for their popular app, to not only keep their user base, but increase it significantly. Even though it is a free app, the vast number of users bring in advertising revenue from the Snap Stories feature, and without them there is no profit.  

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In the past, Spiegel has made decisions based on intuition rather than data, but he admits that the strategy won’t last forever. After the last bad quarter, Spiegel spoke about some things that they will want to change for the upcoming year. Originally, Snapchat was meant to be the opposite of platforms like Facebook by having user data immediately disappear and that helped popularize the app.

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However, this also makes it difficult to compete with platforms like Instagram that have the constant feed and a seemingly endless amount of content. In the future the app may have a more feed based feature that is more permanent in order to combat this issue. Another part of the problem was attributed to the original design of their primary product, Snapchat.

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Snap Inc. wanted to specifically target the younger audience as they are seen as the group most willing to learn about new technology. The issue arose that Snapchat was too difficult to operate, and that turned off a huge market of predominantly older users from returning to the application. The company also purposefully left labels for buttons out of the app. The idea for this was that young people will have to learn to use the application and all of the additional features that may be difficult to find would then be passed around by word of mouth.

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The theory played out well but a younger audience is a smaller one and with an increase in ease of use, an entire new audience could be reached. Snapchat was meant to create more meaningful interactions, so it took a very long time for them to begin verifying celebrity accounts like other social media platforms. This has caused most of the influential users to leave for other platforms with more direct means of making money. The overhaul may include more aspects of popular social media platforms and may stray away from the typical messaging app idea.

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It will be interesting to see what Snap Inc. does with their signature product. I think it’s safe to say that most of us use Snapchat every day but it could be a completely different app come 2018. It may be better than ever and Snap Inc. could rake in billions, but who knows? It could just be the next MySpace.