Would an Amazon-Snap Partnership Work?

Snap, Inc. (NYSE: SNAP) stock sprung to life on Monday after a report by TechCrunch revealed a potential new partnership with Amazon.com (AMZN). According to the report, there is a description of a feature called “Visual Search” buried in Snapchat’s Android App code, and investors are speculating the new feature could be a big hit.

The description for Visual Search describes functionality that could potentially differentiate Snapchat’s camera from social media competitors such as Facebook (FB) subsidiary Instagram.

“Press and hold to identify an object, song, barcode, and more! This works by sending data to Amazon, Shazam, and other partners,” the description reads.

The code suggests that after an object has been identified, Amazon search results for the object are displayed for the user. This type of feature is not currently available on any other social media platform and could even potentially expand Snapchat’s functionality beyond the social media realm and into object identification and navigation-related applications.

Snap stock traded higher on Monday afternoon following the report, but has struggled to gain traction in the market in 2018. Facebook’s hugely successful Instagram platform has been outperforming Snapchat in growth and engagement, and advertisers and investors have taken notice. Instagram Stories, which launched as a Snapchat Stories clone just two years ago, now has twice the number of users as Snapchat Stories and is growing six times faster.

According to Bank of America’s recent social media user survey, Instagram is the gold standard of social media at the moment. Compared to six months ago, 44 percent of Instagram users report increasing their usage compared to just 14 percent of users who have decreased usage. For Snapchat, 32 percent of users have increased usage and 35 percent have decreased usage in the past six months.

However, a new, differentiated feature could go a long way in getting users back on the Snapchat platform and helping them forget about a poorly received app redesign earlier this year.

Snap hired a new CFO in May, and “Visual Search” may be an indication that the company is being more aggressive in improving its platform.

Bank of America analyst Justin Post says Snap needs more of a sense of urgency. “With WhatsApp and Instagram continuing to capture user share, we think…

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