Snap Inc are an interesting company. From Snapchat’s wildfire like growth, to the dramatic rise and fall of Snap Inc’s stock price; they’ve gone through some twists and turns over the years.
Probably my favourite part of Snap Inc, though, is how they created one of the most desired products on the planet and then ruined it within a year.
The story begins with Snap Inc acquiring a hardware company called Vergence Labs.
Vergence Labs had developed sunglasses that could record videos in the viewing perspective of the user (the video would record as if you were watching through the user’s eyeballs). Unlike most wearable cameras, the camera within these sunglasses wasn’t noticeable.
Vergence Labs end goal was to make Augmented-Reality glasses, which would allow the user to see and interact with digital objects through the glasses’ lenses. The video functionality was just the first step towards this goal.
They never achieved Augmented Reality, as their company was acquired by Snap Inc who made them focus on the video functionality of their eyewear instead.
The improved video capability and the bold new design of the sunglasses made them a striking product, and Snap Inc dubbed the eyewear “Snapchat Spectacles”.
The design of the eyewear was unique, and leaned into the “hipster” fashion trends that were popular in 2016. Making the Spectacles attractive to wear was definitely important for making them successful.
Snap Inc even created a popup vending machine for selling the Spectacles called “Snapbot” which had an equally vibrant visual design; appearing like something out of a ’70s sci-fi movie.
The Snapbot would temporarily appear at random locations across the US for people to buy Snapchat Spectacles, with people quickly gathering at the vending machines and forming huge queues to buy their own
The limited time for making a purchase along with only being able to purchase at the Snapbot resulted in Spectacles gaining a huge amount of hype. Snap Inc perfectly managed to utilise “fear of missing out” to make the illusive Spectacles the most talked about new technology during its initial release.
Resale values for the glasses were, of course, massive.
Snap Inc hadn’t just created a cool bit of tech, they’d created a fashion statement. The initial buzz of the Spectacles was comparable to a YEEZY or Supreme release, rather than anything you’d expect from a camera company.
And by the looks of it, Snap Inc thought they’d just created the next iPod.
I think it’s important that you understand what Vergence Labs were initially aiming to achieve, as it’s a big part of why the tech community were originally intrigued by Snap Inc’s move into hardware.
Snap Inc purchasing an Augmented Reality company and then doing mysterious popup releases across the US seemed like the start of something massive; as if the glasses were going to be part of a bigger technological event that was just on the horizon. With the popularity of Snapchat at the time being unrivalled, it seemed as if Snap Inc were the company who could instruct that kind of huge moment in both the software and hardware industries.
However, that technology wasn’t there, and in actuality Spectacles were closer to a sunglasses brand than a revolutionary tech startup.
Which was fine, and they were definitely fashionable sunglasses. The process of buying Spectacles in itself was exciting enough to keep consumers intrigued. The limited availability of the Spectacles also worked in their favour.
However, without the ability to provide a groundbreaking bit of tech, Spectacles weren’t going to get a huge amount of orders. Spectacles would peak as a fashion statement, and if Snap Inc realised this they would have been able to make Spectacles a much more successful brand.
Snap Inc decided to move their sales from physical (through the Snapbot) to their website. The aim was obviously to launch Spectacles to the masses, hoping the huge demand they saw at the Snapbot would maximise on the internet.
The distinction between whether Spectacles was a fashion or tech brand is important in this context, as it determines how many units of Spectacles that Snap Inc should make available during this initial release.
If it’s a fashion statement, Snap Inc should do limited releases in order to quickly sell out and allowing them to continue nurturing the demand of the Spectacles. The fashion route would also allow them to collaborate with other brands for unique spins on the Spectacles design and colour options (like sneaker brands do).
If it’s a tech release, Snap Inc should allow for the maximum amount of units to be sold. They should also provide annual releases with the newest iteration of the hardware.
Snap Inc decided to go with the tech release, which was the wrong decision.
They greatly over estimated the demand of the Spectacles, apparently having to write off $40,000,000 worth of unsold hardware.
The irony was that they actually sold 220,000 units, which shows there was good demand for the product. If they had released small quantities of the glasses (and especially if they worked with other fashion brands), Spectacles would have been a monumental success.
Due to the Spectacles only being annual releases and being treated like a technology brand, it quickly lost traction and now only receives 1% of the attention it did at its peak back in 2016.
Snap Inc are continuing to work towards the original vision of Augmented Reality devices, but whether they will be able to achieve this goal with interest dwindling in Spectacles is questionable.
To me, it looks like Snap Inc completely misunderstood their market. If they better utilised their ability to create a fashion brand, it would have resulted in a much stronger brand overall and generated much more revenue for funding their eventual goal of Augmented Reality glasses.
However, hindsight is 20:20, and at the time it was difficult to determine what the best course of action Snap Inc could take.
I hope you enjoyed that article, writing it definitely helped me take my mind off of the chaos that is happening at the moment! For more articles about marketing and brands, please subscribe: