Snap’s Current Hype Machine Could Hurt It Post-IPO


…Snap has been unable to break out of the “experimental” portion of many advertisers’ budgets, according to the agency executive. These budgets, the agency executive said, get portioned out based on a 70–20–10 rule: 70% of advertiser budgets is spent inside platforms that are tried and true, 20% is spent with platforms that are still emerging, and 10% in spent in the next/innovation bucket. “I would bet that most still put Snapchat in that 10%,” the agency executive said. “For us, Facebook is in that 70% and Snapchat is nowhere near that.

Snapchat, by many accounts, is the most innovative company in tech right now. That may not matter if they cannot develop a business model.