Social media giants Facebook Inc. (NASDAQ:FB) recently held their “A Place To Connect” event in New Delhi. The event was mainly headlined by Facebook showcasing their family of products and apps. It was primarily a community engagement exercise, however, Facebook made some fairly pertinent announcements which give us greater insight into the social media giant’s ventures in India and their plans to tackle the competition.

One of the most significant features of the event was the announcement of certain new India specific features for Facebook.

Facebook Is Indianizing Itself

On Wednesday, Facebook announced their plans to roll out new camera effects and interface specifically for Indian users. These custom effects include capturing geo-specific experiences in Delhi, Mumbai, Goa and some other places. On the face of it, this might not seem like a big deal. However, this is just another step in a larger effort to gain a stranglehold on the Indian market by Facebook.

It started with Facebook launching the Facebook Lite app in India back in 2015. At the time the idea of a Lite app version was extremely unusual. However, the app was specifically catered to markets such as India which were characterised by poor wireless connectivity and speeds. The Lite app was optimised to provide a smooth experience on slower connections and lower end devices, while still providing all the basic Facebook features. The app was an incredible success, crossing 200 million users worldwide in 2017 and registering a 100% growth in 1 year. The success of the app can be attributed to emerging, high volume markets like India. India has been a highly lucrative market for Facebook, with nearly 184 million active monthly users.

At the recent event, Facebook went one step further by announcing exclusive camera effects for Indian users. Facebook also announced that they would add the incredibly popular “Reactions” feature to the Facebook Lite app. These announcements only emphasise Facebook’s continued commitment to their Indian users. This comes in stark contrast to other popular social media platforms like Snapchat who have been facing criticism in India of late.

Facebook Goes To War With Snapchat

Facebook, which is set to hit 2 billion active monthly users in 2017 is undoubtedly one of the biggest social media companies in the world. Their market capitalization now exceeds $400 billion. Snapchat, on the other hand, is a relative newcomer to the social media scene. Since their launch in 2011, Snapchat now stands at 160 million active monthly users. Snap Inc, the parent company of Snapchat attained a market capitalization of $28.3 billion after their IPO in March. Despite the gulf in size between the two rivals, Facebook is wary of Snapchat and have taken the fight to them.

Facebook has been systematically borrowing features from Snapchat for a while now. One major instance of this is when Facebook introduced “Stories” to their Instagram app. Snapchat was first to offer such a feature, however now Instagram Stories has become more popular with nearly 200 million people stories every day. This is more than Snapchat’s entire user-base. Similarly, Facebook imitated other Snapchat features by introducing Quick Updates, One-Hour Messages, Bolt etc. The one big advantage Facebook holds here is their larger user-base and extended ecosystem. Facebook have other popular platforms such as Instagram, Whatsapp etc under their wing, whereas Snapchat does not have the same luxury. Facebook have also been helped by Snapchat shooting themselves in the foot. Recent reports have claimed that Snapchat CEO Evan Spiegel said “This app is only for rich people. I don’t want to expand into poor countries like India and Spain”. This has undoubtedly hurt Snapchat in a potentially very lucrative mass market such as India. Reviews of the app dropped to 1 star in the App store and Snapchat has only managed to gain a paltry 4 million users in India.

At their F8 developer conference, Facebook also recently announced the launch of its Camera Effects platform. This is to aid developers in adding AR effects to Facebook Camera. Once again this is in direct competition to Snapchat, who have long been offering AR based effects to their users. Ultimately, with such similar feature sets, the question of who emerges victorious will come down to the quality of execution.

Takeaways

  • Facebook are making concerted efforts to appeal to the Indian demographic. A mass market like India affords incredible avenues for growth and we can expect Facebook to make India a priority.
  • The Facebook Lite app was a phenomenal success across emerging markets. With markets such as the US saturating, it is vital for Facebook to create a foothold in emerging markets.
  • Facebook are directly competing with Snapchat by copying features and leveraging the advantage of their larger user-base and ecosystem. If they manage to implement these features in a better way, it may mean the end of Snapchat.
  • Snapchat’s missteps relating to India may cost them dearly as Facebook may completely overwhelm them in a key strategic market like India. We may find Snapchat abandoned by Indian users.