Is Facebook Looking To Counter Snapchat With LifeStage?

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Looking to maintain its “cool” quotient and prevent young users from migrating to other platforms, Facebook (NASDAQ:FB) recently launched an iOS app called “Lifestage” for users under the age of 21. This video app, which looks relatively similar to Snapchat, allows users to share video within their networks. As the popularity of other social media platforms such as Snapchat increases among young users (more than 60% of U.S. smartphone users between the ages 13 and 34 use Snapchat) this launch appears to be Facebook’s move to attract and keep younger users. Reviews have been mixed so far, but a successful video product could provide a boost to the company’s revenues.

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Increasing Engagement Among Teenage Users

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Facebook is targeting high school and college aged users with its new app, some of whom may find its core platform outdated. While the company is constantly making changes to its news feed and adding new features to its existing platform, a new video-based app for teenagers can ensure that the platform remains “new.” The company continues to increase its focus on video-based content, in line with its overall strategy of promoting more videos and other immersive experiences (such as Virtual Reality) and gradually moving away from text-only content. A more video-centric, interactive experience could increase user engagement on Facebook.

Retaining Its Competitive Edge

While Facebook is the undisputed leader in social media with high user engagement, a widening user base and massive advertising revenues, competitors such as Snapchat are gradually establishing bases of loyal users. Snapchat is the fastest-growing social network, and its user base in the U.S. is expected to increase by nearly 30% in 2016 reaching almost 60 million users, and may soon surpass Twitter’s user base. Snapchat is especially popular with young users, and while its user numbers are still dwarfed by Facebook’s 1.3 billion strong user base, it can still negatively impact the engagement levels of Facebook’s younger users.

While Facebook is too large to be seriously threatened by competitors, the company does need to to constantly innovate in order to improve user engagement and grow its advertising revenues. The push towards video content and the VR space should allow Facebook to retain the attention span of the younger segment of its users.

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