Culture publisher WorldstarHipHop has debuted a Snapchat Discover channel as part of its shift from content aggregator to original content producer. Effective Sept. 10, it is publishing weekdays with hosted shows, newsy hip-hop-related videos, and memes.
The move to Snapchat is part of a broader market trend, financial blogger Luke Lango wrote in a Sept. 11 Investor Place blog. If you’re looking for social media stocks recently, “you won’t find them anywhere except for the dumpster,” Lango wrote. However, he added that the valuation on Snap stock looks compelling below $10:
“Over the past several weeks, investors have been dumping social media stocks as headwinds against the industry have piled up, including privacy issues, regulation concerns, sluggish user growth, stagnating margins, and stalled-out engagement.”
So far in September, Snapchat launched new shows with WorldStarHipHop and The Players’ Tribune, two organizations with broad millennial appeal, Lango said. Also in September:
“I think it is time to get bullish on these beaten-up social media stocks”. — Financial blogger Luke Lango, Investor Place.
WorldStar started out as a site for people to download hip-hop mixtapes and evolved into a video aggregator best known for crowd-sourced videos of people fighting, according to Digiday. It also became a hub for hip-hop artists to grow their fan bases by publishing their music videos. WorldStar’s site received 4.7 million unique visitors in the U.S. in July — a 66 percent increase year over year, according to comScore.
Over the past few years, represented by Hollywood talent agency WME, WorldStar built its original content business, producing a TV show for MTV2, a movie for Netflix and a documentary series for Starz. In 2017, it signed a deal with digital entertainment company Studio71 to produce more original content online.
Studio71 sells ads, makes branded-content deals with advertisers and advises WorldStar how to grow its audience on YouTube. WorldStar and Studio71 will be splitting ad revenue on the new Snapchat Discover channel, Digiday reported.
“Broadly speaking, it looks like Snapchat is adding important shows to boost engagement, finding great success in pushing its lenses as a unique advertising and branding opportunity, and finding equally great success in pioneering social e-commerce,” Lango wrote for Investor Place.
Snap, the parent of Snapchat, has been investing in original content as part of its effort to make the app more appealing to social media users, MobileMarketer.com reported in August. Snap said Snapchat’s user growth had declined for the first time, according to the August report, but despite the drop in users, Snapchat’s revenue rose 44 percent from a year earlier to $262.3 million.