Messaging service Snapchat, limbering up for an IPO this year that could value it at $25bn, is a potential rival to Facebook according to WPP CEO Sir Martin Sorrell.
Speaking at Davos Sorrell said that WPP clients spent $90m with Snapchat in 2016, up from earlier estimates of $30m. It spent $5bn with Google and $1.7bn with Facebook. Snapchat’s 2016 ad revenue is thought to be about $400m with $1bn or so the target for this year.
Sorrell told CNBC: “it does become a threatening alternative to Facebook and I think that’s the big opportunity for them. We know Facebook have tried to buy Snapchat a couple of times, we know that they’ve made product changes as a result of Snapchat’s products.”
The WPP boss could just be being mischievous of course, putting pressure on Facebook to clean up its metrics and, maybe, offer WPP a better deal. But Snapchat, rather bizarrely given its origins as an anti-establishent instant messenger, does seem to have found ways of adapting its service to advertising, unlike, say, Twitter.
Sorrell also noted that his geo-political predictions for 2016 had proved mostly wrong (about Donald Trump and Brexit in particular), in line with those other business folk and billionaires inhabiting the Davos “bubble.” Something he does know a lot about, having met Lady Sorrell at..Davos.