uploads/2019/04/apple-inc-508812_640.jpg

Will Snapchat’s Gaming Platform Be a Game Changer for the Company?

By

Updated

Snap just launched its own gaming platform

Snap (SNAP) is the latest tech company to join the gaming rush, thereby opening up another stream of revenue. On Thursday, April 4, Snapchat launched its Snap Games platform, which will allow its users to play multiplayer games while texting. Snap said that its first original game is called “Bitmoji Party,” a Mario Party style game. The company could roll out a number of other games on its platform developed by its partners, including Zynga.

Article continues below advertisement

In Bitmoji Party, the users’ Bitmoji avatar competes with up to seven friends in several mini-games. The crux of the game is to balance the avatar on a giant record as the DJ scratches it. Users can invite many more friends to watch the game. The fact that the gaming platform will pit users against their friends could appeal to a lot of young users.

WAKE UP WITH BAGELS & STOX, OUR NEW EMAIL THAT ENTERTAINS AND INFORMS YOU BEFORE THE DAY STARTS. SIGN UP HERE!

Ads from gaming will be a new stream of revenue for Snap

Gamers will have the option to watch commercials that reward them with virtual coins and other rewards, which is how many online games monetize their platform. Snapchat will share revenue from the ads with its partners. However, Snap will have to generate enough ad revenue to keep their developers interested. Snapchat could also generate much more revenue by charging for cosmetic updates, just like Fortnite does.

Multiplayer games could help in improving the engagement of Snapchat’s users. The gaming platform will also help retain Snapchat’s young audience and even help gain more users. This move is Snapchat’s latest move to differentiate itself from other social media platforms, especially Instagram. Unfortunately for Snapchat, Instagram has cloned many of Snapchat’s popular features, which has benefitted Instagram a lot at Snapchat’s expense.

The rumors of Snap working on its gaming platform have been driving the stock’s most recent rally. The stock went up 1.1% on Thursday, even though broader markets stalled. Snap’s stock is now trading at a seven-month high and is up 134% since December 21, 2018.

Advertisement

More From Market Realist