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The Gist
- Rapid growth achieved. Snapchat+ hits 7 million subscribers, surpassing Instagram and Twitter.
- Enhanced user experience. AI features significantly improve Snapchat’s functionality and appeal.
- Significant revenue potential. Snapchat+ poised to generate $330 million annually, bolstering Snap’s finances.
Snapchat+ hit another wild milestone over the holiday break. The $3.99-per-month premium subscription reached 7 million paying users, up by 2 million since September 2023 and more than double its April total. It now dwarfs Instagram and Twitter’s premium offerings, which have struggled to move beyond 1 million subscribers. And that’s perhaps because Snapchat+ is not a social media subscription at all.
Snapchat+ Launches AI-Packed $3.99 Plan
For the $3.99, Snapchat offers users a slew of generative AI features, not simply status markers like blue checks. Snapchat+ subscribers get an AI image generator similar to Dall-E, an AI image extender that expands pictures based on what the tech thinks is out of frame, special functionality in Snapchat’s GPT-4-powered chatbot called My AI, and a “Dreams” tool that uses selfies to create images of users in fantasy settings like alternate universes or movie posters.
Snapchat+, in other words, is a generative AI product, and a hit at that. And as the first breakout in the genre since ChatGPT, its success indicates that generative AI’s near-term future may be a bit different than many anticipated.
Related Article: Why Snapchat’s Product Is Booming
Snapchat+ Boosts App With AI Enhancements
As opposed to a brand new experience, Snapchat+ is a collection of AI features bolted onto an existing app. You don’t go to Snapchat to use the AI features alone, they instead enhance everything you do there. The AI helps you send more vibrant pictures to friends, post more imaginative scenes to your story, and chat with a fast (and smart) AI bot as you wait for your friends to message back. It does not fundamentally transform the Snapchat experience, and yet it’s working. Snap tells me its users have sent 20 billion messages with My AI so far, including with a limited version that is now free to everyone.
Related Article: AI in Customer Experience: Trends to Watch in 2024
ChatGPT Tech Might Be Best Used as Enhancer
Though ChatGPT debuted as the fastest-growing new consumer product ever, its underlying technology may be best used in Snapchat+ style experiences — not complete reimaginations of computing — at least for now. It may not reinvent search, but it will be a feature on top of Google. It may not replace the spreadsheet, but it’ll be in Excel if you want to chat with numbers. It may not create a new category of consumer apps, but it will embolden those app developers who adopt it quickly.
Related Article: AI in Business: How Company Leaders Are Taking the Plunge
Snapchat+ AI: Logical Move, Big Revenue
Snapchat finding success here early makes plenty of sense. AI image generation is fundamentally a communication technology, a tool for people to express themselves more vibrantly and imaginatively than they could previously. When stapled onto a camera-first messaging app, its ascent is logical.
And for Snap, generative AI is a welcome new business line, especially as it’s struggled to maximize the value of its ad space. Bloomberg estimated that 7 million paying Snapchat+ subscribers could bring in $330 million in revenue over a year. It’s a meaningful number for a company estimated to have made around $4.6 billion in 2023.
Related Article: 5 CX KPIs Companies Are Improving With AI
Generative AI an Opportunity for Businesses
Generative AI may still live up to its lofty expectations, but it will likely take better, more advanced models to transform computing as we know it. In the meantime, companies applying the current tech will have a real opportunity to append it to their products and win. Snapchat, ever the product innovator, is simply the first to get there.
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