Snapchat to send shoppers to Amazon
Snap (SNAP) is venturing into social commerce through a partnership with Amazon (AMZN). Snap is rolling out a Snapchat feature that lets people find and buy items from Amazon right within the photo-sharing app.
The feature lets people use the Snapchat camera to capture the image of a physical product and look it up on Amazon. When the product is recognized, a small screen appears with a link to buy it on Amazon’s retail site.
Amazon’s retail platform hosts tens of millions of product listings, meaning that the Amazon integration could provide a convenient way for Snapchat users to shop online.
Opportunity to grow Snapchat audience
The integration may also help Snapchat draw more users considering that a UPS Pulse study has shown that the majority of online shoppers begin their product searches on marketplaces such as Amazon.
Snapchat hosted 188 million daily users during the second quarter, but that was down ~3.0 million from the previous quarter. Snap monetizes the Snapchat app by showing advertisements to its users. Snap’s advertising revenue increased 48% YoY (year-over-year) to $260 million in the second quarter. Advertising revenue was up 23% YoY at Twitter (TWTR) in the period.
Race for $165.6 billion social commerce revenue
The global social commerce market is expanding at a rate of 34% every year and is on track to hit $165.6 billion by 2021, according to Technavio.
Facebook (FB) is one of the players vying for the revenue opportunity in the social commerce market. The company operates a marketplace within its namesake social network, which lets individuals and businesses post items for sale to its more than 2.2 billion users globally.
Amazon’s partnership with Snap sees it match a move by its rival eBay (EBAY). In February, eBay announced that it would be teaming up with Mashable on a program that lets Mashable readers shop its site right within the publisher’s platform.