How Snapchat Built a Business By Confusing Olds
By Max Chafkin & Sarah Frier
March 3, 2016
Photographs by Julian Berman
Advertisers want the $16 billion social network's young users
from Bloomberg Businessweek
On a Wednesday in early February, Khaled Khaled, a 40-year-old record producer from Miami, stepped into the garden of his temporary residence at the Beverly Hills Hotel in Los Angeles. As he does most mornings, he gave thanks for another day on earth. “Good morning,” he said to no one in particular. “Bless up.”
Snapchat photo filters
DJ Khaled, as he’s more commonly known, was once a minor figure in the music world, a creator of radio-friendly hip-hop hits and the host of a nightly show on one of Miami’s top FM stations. The rap on Khaled was that he could attract talented collaborators but wasn’t much of a musician himself. “Mostly, he just incessantly screams dumb catchphrases,” one Pitchfork reviewer complained. “And he doesn’t even do that particularly well.” This sort of thing weighed on Khaled. The critics, the haters, the people who’ve ignored his career—they didn’t want him to be in such a beautiful garden.
“I love my angels,” Khaled said, admiring the red, white, and purple cyclamens at the hotel. He saw God in those perennials. He also saw a metaphor for his own life’s journey. Khaled sees metaphors everywhere, actually, which is a major key—or as he prefers to type it out, “major
”—to his success on Snapchat, the social network where he has amassed some 6 million followers since last October. “Life is like flowers,” he observed, training his iPhone camera at the ground and holding down the record button. “You grow. You blossom. You become great.” He posted the 10-second video to Snapchat, then repaired to his bungalow to further philosophize on the power of positive thinking, hard work, and the divine. That went out to his Snapchat followers too, in a continuous series of clips.
If you want to understand Snapchat, the insanely fast-growing and—to people born before 1990—straight-up insane messaging app and media platform, DJ Khaled is your Virgil. If you were one of the 100 million people who logged in to Snapchat each day during Super Bowl weekend, his thick beard and full frame were impossible to miss. You would have seen clips of him at an impromptu concert where he was mobbed by several hundred screaming fans waving giant cardboard keys, or at a raucous party sponsored by PepsiCo, or in a pedicab he hailed after the game. “Ride wit me through the journey [to] more success,” he captioned that last video, as his chauffeur pedaled furiously.
Khaled had never heard of Snapchat when a friend suggested he check it out last year. While taking a break from touring last fall, he gave it a shot. “I didn’t really know how to use it,” he says on a recent afternoon in Los Angeles. “I was kind of just talking to myself.” Khaled filmed everything: his grooming routine, his breakfasts, his hot tub, and, especially, a Tuscan-style lion sculpture that he would often shout at while watering his plants. Mostly, he gave advice. He expounded on the importance of quality bedding (“The key to more success is to have a lot of pillows”) and regular meals (“They don’t want you to eat breakfast”). His most dramatic Snapchat moment occurred during a twilight ride on a personal watercraft in Biscayne Bay. “The key is to make it,” he repeated as he got lost on the water. Then he turned the camera on himself and added, “The key is not to drive your Jet Ski in the dark.”
Khaled made it, and since that fateful night he’s been pretty much the hottest ticket in media—the guy who’s figured out the digital property everyone wants a piece of but no one quite understands. He’s palled around with Snapchat co-founder Evan Spiegel, created Snapchat videos on behalf of Cîroc vodka, and signed a deal to host a weekly radio show on Apple Music’s flagship station, Beats 1. His catchphrases have occasioned explainers from otherwise serious news organizations, including Time, Quartz, and–
–Bloomberg Businessweek. “DJ Khaled has completely cracked the platform,” says Emmanuel Seuge, senior vice president for content at Coca-Cola, one of Snapchat’s major advertisers. “He’s the king of Snapchat.”
“The vast majority of people reading this article will have a Snapchat account within 36 months”
Compared with Twitter or Facebook, Snapchat can seem almost aggressively user-unfriendly. If you’re new to the app and looking for posts by your kid, your boyfriend, or DJ Khaled, good luck. It’s hard to find somebody without knowing his or her screen name. This is by design. “We’ve made it very hard for parents to embarrass their children,” Spiegel said at a conference in January. “It’s much more for sharing personal moments than it is about this public display.”
Spiegel, who declined to be interviewed, has been cagey about Snapchat’s business prospects. Its annual revenue is small—perhaps $200 million, according to several press reports—but it has already drawn many big-name advertisers. Earlier this year, PepsiCo, Amazon.com, Marriott International, and Budweiser paid more than $1 million to have their ads appear within the company’s Super Bowl coverage, according to a person familiar with the deals. And because Snapchat has yet to really try to sell ads to the small and midsize businesses that make up most of Google’s and Facebook’s customer base, there’s a lot of potential.
Featured in Bloomberg Businessweek, Mar. 7, 2016. Subscribe now.
Photographer: Julian Berman for Bloomberg Businessweek
As Facebook has transformed from a slightly wild place to a communications tool for parents, teachers, and heads of state, Snapchat’s more playful ethos, and the fact that anything posted on it disappears in 24 hours, has made it the looser, goofier social network. “You’re sending this ephemera back and forth to your friends,” says Charlie McKittrick, the head of strategy at Mother New York, an ad agency. “It’s the detritus of life. But it’s really funny.” Last September, while Mark Zuckerberg hosted Indian Prime Minister Narendra Modi on Facebook’s campus, the big news at Snapchat’s offices in Venice was a feature called Lenses, which makes your selfies look like you’re vomiting a rainbow.
Snapchat is just the sort of place where DJ Khaled, in his uninhibited glory, could find an audience. Vice called his Jet Ski adventure “the greatest sitcom episode ever filmed.” Elite Daily, the “voice of Generation Y” news site, raved, “If You’re Not Following DJ Khaled On Snapchat Already, You’re Buggin’.” In December, Khaled posted to Snapchat while getting his iPhone fixed at an Apple Store. Soon he was surrounded by fans. “It was unreal,” he says. “My Snapchat has more viewers than any TV show.”
That’s an exaggeration, but not by much. Khaled’s videos attract 3 million to 4 million viewers each. Given how Snapchat skews overwhelmingly tween to late-millennial, that means about the same number of young people are watching him admire flowers as are watching the biggest network sitcoms. According to Nielsen, roughly 3.3 million people age 12-34 watch The Big Bang Theory.
Even bigger than the videos posted by Khaled and Kylie Jenner—the platform’s other big star, with 10 million followers—are Snapchat’s own Live Stories. These are mashups of news events culled from the feeds of Snapchat users and produced by the company’s 100-person content team of producers, editors, and a handful of journalists, who sometimes add commentary or contribute more footage. The biggest Live Stories segments—for instance, New York’s 2015 Snowmageddon and the Coachella music festival—can draw viewership in the tens of millions. Snapchat Discover, a collection of slickly produced feeds, attracts audiences in the millions. The company says users watch roughly 8 billion videos on its platform each day, about the same number as Facebook, which has 10 times as many users as Snapchat. On a given day, according to Nielsen, 41 percent of adults in the U.S. under 35 spend time on Snapchat.
“Everybody from 14 to 24 in America, it’s either the No. 1 or No. 2 app in their lives,” after Instagram, says Gary Vaynerchuk, an angel investor and entrepreneur. Actually, it’s not just an American phenomenon: Snapchat is a top 10 most-downloaded app in about 100 countries, according to market researcher App Annie. Vaynerchuk, who has investments in Snapchat, Twitter, and Facebook, likens the excitement to that of television in the early 1960s. “The vast majority of people reading this article will have a Snapchat account within 36 months,” he says. “Even if, as they’re reading this, they don’t believe me.”
By Max Chafkin & Sarah Frier
March 3, 2016
Photographs by Julian Berman
Advertisers want the $16 billion social network's young users
from Bloomberg Businessweek
On a Wednesday in early February, Khaled Khaled, a 40-year-old record producer from Miami, stepped into the garden of his temporary residence at the Beverly Hills Hotel in Los Angeles. As he does most mornings, he gave thanks for another day on earth. “Good morning,” he said to no one in particular. “Bless up.”
Snapchat photo filters
DJ Khaled, as he’s more commonly known, was once a minor figure in the music world, a creator of radio-friendly hip-hop hits and the host of a nightly show on one of Miami’s top FM stations. The rap on Khaled was that he could attract talented collaborators but wasn’t much of a musician himself. “Mostly, he just incessantly screams dumb catchphrases,” one Pitchfork reviewer complained. “And he doesn’t even do that particularly well.” This sort of thing weighed on Khaled. The critics, the haters, the people who’ve ignored his career—they didn’t want him to be in such a beautiful garden.
“I love my angels,” Khaled said, admiring the red, white, and purple cyclamens at the hotel. He saw God in those perennials. He also saw a metaphor for his own life’s journey. Khaled sees metaphors everywhere, actually, which is a major key—or as he prefers to type it out, “major
If you want to understand Snapchat, the insanely fast-growing and—to people born before 1990—straight-up insane messaging app and media platform, DJ Khaled is your Virgil. If you were one of the 100 million people who logged in to Snapchat each day during Super Bowl weekend, his thick beard and full frame were impossible to miss. You would have seen clips of him at an impromptu concert where he was mobbed by several hundred screaming fans waving giant cardboard keys, or at a raucous party sponsored by PepsiCo, or in a pedicab he hailed after the game. “Ride wit me through the journey [to] more success,” he captioned that last video, as his chauffeur pedaled furiously.
Khaled had never heard of Snapchat when a friend suggested he check it out last year. While taking a break from touring last fall, he gave it a shot. “I didn’t really know how to use it,” he says on a recent afternoon in Los Angeles. “I was kind of just talking to myself.” Khaled filmed everything: his grooming routine, his breakfasts, his hot tub, and, especially, a Tuscan-style lion sculpture that he would often shout at while watering his plants. Mostly, he gave advice. He expounded on the importance of quality bedding (“The key to more success is to have a lot of pillows”) and regular meals (“They don’t want you to eat breakfast”). His most dramatic Snapchat moment occurred during a twilight ride on a personal watercraft in Biscayne Bay. “The key is to make it,” he repeated as he got lost on the water. Then he turned the camera on himself and added, “The key is not to drive your Jet Ski in the dark.”
Khaled made it, and since that fateful night he’s been pretty much the hottest ticket in media—the guy who’s figured out the digital property everyone wants a piece of but no one quite understands. He’s palled around with Snapchat co-founder Evan Spiegel, created Snapchat videos on behalf of Cîroc vodka, and signed a deal to host a weekly radio show on Apple Music’s flagship station, Beats 1. His catchphrases have occasioned explainers from otherwise serious news organizations, including Time, Quartz, and–
“The vast majority of people reading this article will have a Snapchat account within 36 months”
Compared with Twitter or Facebook, Snapchat can seem almost aggressively user-unfriendly. If you’re new to the app and looking for posts by your kid, your boyfriend, or DJ Khaled, good luck. It’s hard to find somebody without knowing his or her screen name. This is by design. “We’ve made it very hard for parents to embarrass their children,” Spiegel said at a conference in January. “It’s much more for sharing personal moments than it is about this public display.”
Spiegel, who declined to be interviewed, has been cagey about Snapchat’s business prospects. Its annual revenue is small—perhaps $200 million, according to several press reports—but it has already drawn many big-name advertisers. Earlier this year, PepsiCo, Amazon.com, Marriott International, and Budweiser paid more than $1 million to have their ads appear within the company’s Super Bowl coverage, according to a person familiar with the deals. And because Snapchat has yet to really try to sell ads to the small and midsize businesses that make up most of Google’s and Facebook’s customer base, there’s a lot of potential.
Featured in Bloomberg Businessweek, Mar. 7, 2016. Subscribe now.
Photographer: Julian Berman for Bloomberg Businessweek
As Facebook has transformed from a slightly wild place to a communications tool for parents, teachers, and heads of state, Snapchat’s more playful ethos, and the fact that anything posted on it disappears in 24 hours, has made it the looser, goofier social network. “You’re sending this ephemera back and forth to your friends,” says Charlie McKittrick, the head of strategy at Mother New York, an ad agency. “It’s the detritus of life. But it’s really funny.” Last September, while Mark Zuckerberg hosted Indian Prime Minister Narendra Modi on Facebook’s campus, the big news at Snapchat’s offices in Venice was a feature called Lenses, which makes your selfies look like you’re vomiting a rainbow.
Snapchat is just the sort of place where DJ Khaled, in his uninhibited glory, could find an audience. Vice called his Jet Ski adventure “the greatest sitcom episode ever filmed.” Elite Daily, the “voice of Generation Y” news site, raved, “If You’re Not Following DJ Khaled On Snapchat Already, You’re Buggin’.” In December, Khaled posted to Snapchat while getting his iPhone fixed at an Apple Store. Soon he was surrounded by fans. “It was unreal,” he says. “My Snapchat has more viewers than any TV show.”
That’s an exaggeration, but not by much. Khaled’s videos attract 3 million to 4 million viewers each. Given how Snapchat skews overwhelmingly tween to late-millennial, that means about the same number of young people are watching him admire flowers as are watching the biggest network sitcoms. According to Nielsen, roughly 3.3 million people age 12-34 watch The Big Bang Theory.
Even bigger than the videos posted by Khaled and Kylie Jenner—the platform’s other big star, with 10 million followers—are Snapchat’s own Live Stories. These are mashups of news events culled from the feeds of Snapchat users and produced by the company’s 100-person content team of producers, editors, and a handful of journalists, who sometimes add commentary or contribute more footage. The biggest Live Stories segments—for instance, New York’s 2015 Snowmageddon and the Coachella music festival—can draw viewership in the tens of millions. Snapchat Discover, a collection of slickly produced feeds, attracts audiences in the millions. The company says users watch roughly 8 billion videos on its platform each day, about the same number as Facebook, which has 10 times as many users as Snapchat. On a given day, according to Nielsen, 41 percent of adults in the U.S. under 35 spend time on Snapchat.
“Everybody from 14 to 24 in America, it’s either the No. 1 or No. 2 app in their lives,” after Instagram, says Gary Vaynerchuk, an angel investor and entrepreneur. Actually, it’s not just an American phenomenon: Snapchat is a top 10 most-downloaded app in about 100 countries, according to market researcher App Annie. Vaynerchuk, who has investments in Snapchat, Twitter, and Facebook, likens the excitement to that of television in the early 1960s. “The vast majority of people reading this article will have a Snapchat account within 36 months,” he says. “Even if, as they’re reading this, they don’t believe me.”
