Is Peach the Next Unicorn in Social?
What is Peach?
Just when you didn’t think it was possible for more social apps to enter the market, Peach blew up all over tech news outlets. Launched earlier last week, Peach has the potential to either be the next social Unicorn like Snapchat or fall flat like many of its predecessors such as Ello and Path. The app is basically a blend of features from existing social networks: Friends, Likes, Status Updates, Activity Logs, Comments, Poking, GIFs, Emojis, and Music Sharing (with some less common extras such as Drawing and Ideas).
Predicting the success of social platforms early on is inherently difficult — the key factors that matter are only quantifiable to a certain degree, after which much of it is simply the network effect. From an investor’s perspective, social apps such as these are high-risk / high-return bets that can pay off immensely (e.g., Facebook’s acquisition of WhatsApp in 2014). From a user’s perspective, these apps are only as relevant as the other users on the platform.
So, what aspects of Peach make it a potential success? What is wrong or missing that can make it a flop?
What Peach Does Well
- App Engagement: Similar to Slack, commands (aka Peach’s “magic words”) can be used as shortcuts to send certain types of updates, such as the time, weather, a funny GIF, or drawing. Millennials and Gen Z-ers are tech natives — these commands are efficient and actually have the potential to extend beyond its simple applications today (e.g., commands to start a video chat or pull in 3rd party posts).
- Personal Network Updates: Similarly, users have a variety of options for updating their friend network, expanding on Facebook’s status updates. Facebook updates are still text-based a lot of the times (or link-based for news sharing) — what Snapchat, Instagram, and now Peach get right is moving away from this using pictures and videos. Another point is that Facebook and Instagram distribute updates by using a News Feed-like approach, whereas Snapchat and Peach choose to use a more concise Friends list that shows only the most recent updates.
- Integration of Social Features: Peach makes it easy for 3rd party features and platforms to be integrated into its experience. For instance, Peach currently incorporates Giphy natively, without the need to install a separate keyboard or access permissions. Peach also has the ability to “Shazam” music and share what users are listening to, though I believe the tech does not actually use Shazam (may be another provider). This design makes it easier for the app to stay both relevant and flexible.
- Public Awareness: This aspect really has nothing to do with the app itself, but is still worth noting. Peach has received immense coverage by the press due to the popularity of its creator, the founder of Vine. Certainly, this is incredibly helpful for driving adoption.
What Peach Fails to Do
- New User Acquisition: Currently, new users can only search for friends through their phone contact list or by inputting usernames. The app is unable to link to Facebook or Snapchat or Twitter to discover common friends.
- User-to-User Interaction: Peach completely removes the ability to directly message other users, tag people, or even use hashtags to broaden the scope of content sharing and discovery. The extent of direct user “message” interaction is similar to Facebook’s Poking feature — now you just have more options, where you can wave or even cake a friend. This design may be a conscious choice by the founding team, though it is unclear to me if this will ultimately detract from the app’s audience reach.
- App Differentiation: While the app received a significant amount of press last week and rose to the top of iOS downloads charts (Peach is not available on Android as of yet), most of this is likely driven by early adopters looking to just test out the new social platform. Put quite simply, the app is a mix of many existing social networks — not sure what this achieves, unless the goal is to consolidate or even cannibalize users from all these other platforms which is exceedingly difficult.
- Privacy Controls: Peach currently has limited privacy controls. However, depending on the goals of the app, perhaps privacy controls beyond visibility to “friends of friends” or “friends” are unnecessary, given that it is somewhat difficult to discover other users to begin with.
- Future Monetization: If this app is looking to eventually get funded (and maybe acquired down the line, if it succeeds), the question of how big this app could become is just as important as how this app is going to generate revenue (or at least enough “value” to get acquired). For the most part, these apps can really employ only 3 different business models: 1) free / ad-based, 2) freemium, and 3) subscription-based. It is highly unlikely that this will fall into category #3, and #2 is probably a stretch as well, so let’s disregard those for now. Option #1 is where most of these successful social platforms, like Facebook, Instagram, and Twitter, tend to fall. In order to execute #1 successfully, the app needs to be able to reach large audiences and achieve high engagement. As mentioned above, Peach actually makes it quite difficult to acquire new friends and establish a greater network. Some news outlets are also now saying that early adopters only felt the app was refreshing initially, but engagement fell off steadily after a few days of usage.
Peach has quite a few hurdles to overcome if it aims to become the next Snapchat. While the app just rolled out a new update today, all of the points above remain relevant. Although it is a little too early to tell whether or not Peach will become the next unicorn in social, my conclusion is leaning towards no.