A Social App by Any Other Name (Please, give us one)

TL;DR — Vero, the most recent lightning bolt of a social media contender, already feels like old news. Yet with rising frustration in Facebook, Instagram, and Snapchat, could there be a way for a new social platform to break into the market?

Vero, we hardly knew ya

On March 16, 2018, The Drum posted an article about the new social app, Vero. The app, first launching in 2015, saw a user growth of 500,000 people in only 24 hours, and just kept growing. The massive spike caused headlines like “What is Vero App: the Anti-Facebook” and “Instagram Killer? Vero shoots to top of app charts”. But just as suddenly as Vero gained fame, it lost its following due to mistrust of its management team and severe user agreement.

Although the app is still running, the buzz around Vero is certainly gone, adding it to the list of “flash in the pan” social apps such as Mastodon, Ello, Peach, and more. Yet the consistent referral to Vero as “the Instagram Killer” and “The one who could catch Facebook” got our team thinking: What would it take for a social media startup to be competitive with the Big 6 (Facebook, Instagram, Twitter, Snapchat, Pinterest, and YouTube)? More importantly, what would spur us to invest time and resources into understanding how to use a platform as a part of our social strategy?

Hockey Stick Growth — the base layer

When looking at investment and focus from a business standpoint, it is important to look at the “hockey stick growth” of new companies. For those unfamiliar, “hockey stick growth” is a concept researched by Bobby Martin, and refers to a four-step process that many successful startups go through (more than 150 in his first study alone). The four stages are:

• Tinkering: when the founder(s) “start to take action and examine the idea more seriously”.
• The Blade Years: when the company is really trying to get off the ground. (This was Facebook when it was only in a couple colleges and you needed a .edu email address to sign up)
• The Growth Inflection Point: when the business model hits a “final stage” and revenue starts to pour in.
• Surging Growth: when there is mass buy-in and it becomes a scalable business with lasting power.

This concept is great for a base-level understanding, but it does not fully explain how a company can break through when there is heavily entrenched competition. In order for that to work, a company needs two things: a point of differentiation and an “X Factor”. The point of differentiation, as the name implies, has to be a truly different attribute from the competition (i.e. Snapchat’s self-deleting photos in a saturated messaging market). The “X Factor”, coined by PayPal founder Peter Theil, is the growth exponent that gets a business through the Growth Inflection Point. For PayPal, that was 7% a day, which meant they were able to go from 24 users to over 1 million in five months. For brands looking to be early adopters of social media, looking at the sustained exponential growth of a social startup is a very strong indicator. But what do we at Sitewire look for before adding a platform to our social strategy, or looking to make them a partner for ad-buys?

How Could a New Platform be a Contender?

It needs to be new

When looking at the Big 6, the basic function of each one seems clear:

• Facebook: Follow friends and share cat videos
• Twitter: Friends, news, celebrities, and brands sharing stream-of-consciousness thoughts in “real time”
• Instagram: Friend and influencers sharing life experiences through photos (with a very clean interface)
• Pinterest: Discovering new ideas and inspiration (part of the reason why people are more open to following brands here than anywhere else).
• YouTube: High quality, normally “long-form”, video content
• Snapchat: disappearing messaging and “real-time” image/video content from friends

In order for a social startup to succeed, it has to hit a new point of differentiation. Vero came close by being a hybrid of Instagram and Tumblr, but with the main tenant of keeping a chronological feed. With the backlash against Facebook and Instagram switching to algorithmic models, a social platform with a promise sounded like a good alternative. From a brand perspective, it is also important to understand how a new platform can add value that might not have been accessible before. Twitter offers a unique value for brands because of the ability to respond to users in real time and make a splash with it. Snapchat’s Discover stories and creative ads promote engagement with users. But without a clear value and point of differentiation, it is hard to maintain buy-in from brands.

It needs to be sustainable

In other words, the business model has to be obvious. Most social media platforms are free to users, but use data and advertisements to stay in business. Vero offered a different model: pay a subscription fee to never have ads. The pros and cons of one or the other are up to the social startup. A recent ComScore study found that millennials don’t mind paying for apps, and with the rise of influencer marketing, having an ad- and bot-free experience might offer value to brands who are seeking to promote an authentic message. If there are ads, then they should feel integrated and planned and not take away from the experience. More importantly, a new social platform should have a clear format for how business partners can engage with it, otherwise it will be hard to build buy-in.

It needs to be transparent and secure

We live in an age where transparency has become an absolute must. With rising dissatisfaction in the handling of personal data, any social startup that feels remotely shady will struggle to gain traction. The lack of trust in Vero’s user agreement and management team shook users’ sense of security in the new app. If a social startup arose with a focus on transparency in how it collects and uses data, along with open metrics for influencers from the get-go, it could bring in a lot of users looking for a better alternative.

Social platforms aren’t just gathering user data, they are gathering business and brand data too. For companies looking to use a new social platform to reach new customers, transparency is just as important. You want to ensure you know what data you are providing the platform along with what you are receiving and how it is gained. Changes in the EU with the General Data Protection Regulations will require companies to make their user agreements more clear, so companies should know what data a social platform collects on all sides. Ensuring you understand the fine print before working with a platform is vital for long-term security.

It needs to encourage growth and habit-making

This sounds like a no-brainer, but it is incredibly important to the success of a social startup. When it comes to smartphones, the power of habit can make or break a social startup. A ComScore study from 2015 found that 88% of our time on our phones is contained to the “Top 5” apps, with 50% of all app time being spent on the #1 app. If a new company cannot encourage new users to sign up or keep coming back, it will fade before it gets started. The online quiz-show HQ is a great case study on how to keep people coming back. It encouraged new user sign-ups by offering an extra life to the current user for every friend who accepts the invite to the app (a huge bonus for a 12-question game). Its use of push notifications to alert users about the prize money encourages people to tune in to its twice-a-day game-time show. By having a unique differentiator and quality engagement, a social startup could quickly make its way up the ranks, but that also depends on the last factor…

It needs to be easily accessible and add value

The biggest hurdle any social startup will face in 2018 will be buy-in from consumers, especially those who have built walled gardens around themselves with the Big 6. For those who have been on the Big 6 for years, the thought of having to find their friends, rebuild the content banks and following they had, and re-curate feeds seems daunting. Any social startup that wants to go against the Big 6 should have a plan for conversion and ease of access. This could be coming up with a way of transferring contacts from one platform to another or having a simple enough user experience that switching or adding the app to a user’s social routine is simple.

More importantly, the added value of the social startup has to be paramount. Going back to the hockey stick model, the tinkering and blade years should have a laser focus on the value proposition of the app. Instagram created value by building an app that made people “feel like their photos are worthy of sharing” through the use of filters. They filled a gap in a way that was easily accessible by users and skyrocketed because of it.

The Risks of Competing in 2018

Vero looked like it had a chance to compete against Facebook and Instagram because of the strength of its manifesto. The promise of no ads, the ability to use a stage name instead of your real name, and the dedication to chronological feeds offered a very distinct value proposition in comparison to the Big 6. But there are definite risks to starting a social media platform in 2018 and beyond…

The risk of getting copied

If a platform makes a popular enough feature, there is always the risk of a bigger company finding a way to incorporate the feature to give it an edge (*cough cough* Instagram stories). If the bigger platform can do it as well as the competition, then a startup can quickly lose its competitive advantage.

The risk of getting bought out

To some, this might be the goal instead of a risk, it all depends on the mission of the startup. Yet it is definitely a risk from the view of marketers. It means any time or effort we put into understanding how to buy ads or work with influencers on the platform could become irrelevant.

Vine getting acquired by Twitter is a perfect example of this risk. Vine had fantastic content creators and powerful influencers for brands to work with. Unfortunately, Twitter never figured out how to properly incorporate Vine into its platform after the acquisition, causing the death of Vine.

The risk of being too similar

While there are plenty of other risks, the third and final we look want to look at are platforms that feel too similar to the competition. Another perfect case study is the Twitter-alternative, Mastodon. Mastodon attempted to be a solution to the toxicity of Twitter comments. While it had an initial burst of adopters, Mastodon did not have an easy way of finding friends or posts, making it hard to keep its base. More importantly, the value of Mastodon was not high enough to convert people who already had their friends on Twitter. The point of differentiation was not strong enough to shake Twitter’s hold on its established users.

So, What’s the Next Thing?

Despite the new #deleteFacebook campaign that is rising in response to the exploitation of Facebook data, the Big 6 are maintaining their status and there probably won’t be any major changes to the list for a while. Users and influencers have been incredibly vocal about what they want out of their social media, and companies are listening. That said, there are still plenty of positives to each platform, and every platform recognizes the need to create a great experience for its users.
At Sitewire, we are always looking for the next big thing. We stay at the forefront of social and digital trends to make sure we are capitalizing on opportunities for growth. Yet we do not want to spend excess time trying to partner with frivolous ventures. By having clear goals and a strong checklist of requirements, we make sure our time is spent where it counts. We seek to work with companies built with scalability and sustainability in mind. And until the next big social media company comes along, you can catch us posting about our #officelife on Instagram.