LOS ANGELES, Calif. — Snapchat stock plunged 6% Thursday, wiping off $1.3 billion in market value.
Snapchat co-founder Evan Spiegel said the company is evaluating an app redesign that could be encouraging growth or driving away users, including Kylie Jenner.
The reality TV star and influential Snapchat user tweeted this week that she no longer uses the app. Jenner’s tweet coincided with Snapchat’s parent company’s stock fall.
The app previously featured content from friends, publishers and celebrities on one page. Now, there’s one page for publishers and another for friends. The goal was to attract more users and create a better user experience by separating friends from content.
More than one million people have signed an online petition calling for Snapchat to remove the update, calling it too difficult for users. Negative reviews have flooded the app, prompting one analyst at Citi to downgrade the stock.
“While the recent redesign of its flagship app could produce positive long-term benefits, the significant jump in negative app reviews since the redesign was pushed out a few weeks … could result in a decline in users and user engagement,” Citi analyst Mark May wrote in an investor note this week.
And that was before Jenner abandoned the app.
Snapchat isn’t alone in having hiccups in initial redesigns. Other major social media outlets have had similar struggles.
Roughly a million Facebook users joined a group protesting the company’s decision to introduce News Feed in 2006. At the time, Facebook had 8 million users. Twitter was hit by swarms of complaints from users and celebrities in 2016 about its plans to shift from a reverse chronological timeline to a feed much more guided by an algorithm. Its stock also fell. Both companies pushed forward with their plans and eventually came out successful.
The Snapchat backlash could prove to be an equally defining moment for Spiegel and Snapchat. If he can prove the critics wrong, it may go a long way toward assuring investors and employees that he is a product visionary.
But unlike both Facebook and Twitter, Snapchat’s audience has other available options. Facebook users may dislike certain features, but there’s no other service that provides as large of a people directory — and their birthdays. Presently, Twitter remains the top service for discovering real-time news.
Snapchat’s rival Instagram has managed to clone many of Snapchat’s features. Case in point: Jenner has shared more than 50 posts on Instagram Stories since leaving Snapchat.
Snap acknowledged that the redesign has “felt uncomfortable for many” and promised to tweak the app, but it is not undoing the whole redesign at this time.
“Our goal with the recent redesign is to make Snapchat more personal for everyone,” a Snapchat spokesperson said in a statement provided to CNN on Friday. “This new foundation is just the beginning, and we will always be grateful for any feedback from our community as we roll out new products.”
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