Snapchat grew by creating artificial constraints which made it a small, cool club to belong to

  1. No screenshot
  2. Could add only people from phonebook
  3. Had to share an image from camera instantly
  4. No upload photos
  5. No likes, no permanence, no social anxiety
  6. You could reply only with photos => people started replying with selfies of them reacting to the original post
  7. To view a snap, you had to hold your finger down on the screen. Meant you had to put attention to a snap. Compare it with scrolling your feed on Facebook/Insta
  8. Visual, complicated UI meant users were physically onboarding their friends. And teaching them how to use the app and its new features. People who knew hidden features = super cool

These were the constraints.

But through these constraints, Snapchat also took down the cost of taking and sharing a photo. In a year of Snapchat’s launch, people were sending as many photos as they sent texts in a day.

With Snapchat, there was no pressure to get likes. There was a shared understanding amongst users that photos need not be high quality. This meant users sent snaps the whole day. Snaps were not meant to capture the highlights of their life. It was to replace texting for teens.

Michael Porter calls these constraints tradeoffs and he considers tradeoffs to be the 3rd test of whether or not you have a strategy.

Facebook’s Poke never seriously posed a danger to Snapchat because not collecting data, letting users’ photo conflicted with their business model. Snapchat’s tradeoffs included putting a bunch of constraints on the product. Snapchat letting users only add people from Phonebook meant users forming smaller but close networks, where users trader quality for quantity and shared 10X more photos during the day vs an Instagram or a Facebook. Facebook’s vision is to connect the world and they could not copy the tradeoffs Snapchat focused on. You can copy features. But you can’t copy the constraints/tradeoffs easily. Hence apart from a unique value proposition and tailored value chain, the tradeoff is essential for your business strategy.

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