Two social networks have recently been making headlines not only in the USA but also in Germany: Instagram and Snapchat are attracting growing interest, especially among the millennial generation. But are they also suitable for companies?

Both Instagram and Snapchat have experienced enormous growth rates in recent years. With 400 million users worldwide, Instagram even overtook Twitter (320 million) last year. In Germany, around 10 percent of all Internet users currently have an account. The number of Snapchat users has also grown rapidly in the past year. There are no official figures. Social media experts estimate the number to be around three million, which corresponds to around six percent of German Internet users.

As far as Instagram and Snapchat are concerned, Germany is one of the ten most important countries for both networks and is currently experiencing the highest growth rates. This is one reason why more and more companies are interested in the two social media channels. The focus of both networks is on sharing images. As soon as users follow a certain brand or company, the content appears in the news feed – similar to Facebook. Users can interact with companies by commenting, liking, or sharing the content.

Hashtags and Instagram advertising as a marketing tool

Like Twitter, Instagram uses hashtags, which makes it easier for users to find relevant content. Companies can also benefit from the clever use of hashtags and ensure that their content reaches the relevant user groups. Another way for companies to make their content accessible to users is through Instagram advertising. One advantage for advertisers: Since Instagram has been part of Facebook since 2012, you only need a single interface to place ads on Facebook and Instagram.

When Mark Zuckerberg decided to buy Instagram for a billion US dollars in 2012, many social media experts were shocked. How on earth could an investment in a photo app with mostly blurry images and a very small user base ever pay off? Until recently, analysts expressed similar concerns about Snapchat: Until not so long ago, the network was notorious for nude photos and cat content. But that is now starting to change.

In a world that is completely saturated with media, Snapchat offers users the opportunity to forget. Messages are deleted within a very short time – unless the user saves them using so-called “snaps”: a particular attraction for people under 20 who can hardly remember a life without social networks. Statista calls Snapchat the most valuable and promising startup of the past year.

Where is the target group of a company?

It’s trivial, but still incredibly important: If you decide on a particular social media platform, you should ask yourself whether the target group relevant to your company is active on it. Different companies therefore need different networks.

While Facebook, Twitter, and Xing are often sufficient for a medium-sized company with a conservative customer base, companies with a young target group and a lot of visual content, such as the Rostock-based startup Gusti Leder, are dependent on networks that particularly showcase their content.

Due to the high number of users, YouTube is the first option for many companies here. But Instagram is also now considered “too large to be ignored” by many social media strategists. However, in Germany, it is currently only worthwhile to use it for companies that sell products that are primarily aimed at teenagers or millennials.

Snapchat users are also much younger than the general population. The number of users is currently small, but it is growing rapidly. Another advantage: the number of registered users who log in regularly is higher than on established networks such as Twitter or Facebook. This means that content is spread quickly. If you want to stream content live and also give yourself a youthful image, Snapchat is ideal.

Both Instagram and Snapchat offer tremendous opportunities

When considering marketing strategies, entrepreneurs should keep an eye on the competition: Which networks are my competitors on? What content do they score with? Which customer groups do they appeal to? The number of companies that use Instagram for marketing almost doubled in 2015. Social media strategists expect that in 2016, over 48 percent of American companies will be active on Instagram – either via Instagram ads or their business accounts.

The number of companies active on Snapchat is currently manageable but is also growing rapidly. Starbucks and Taco Bells discovered the platform at the beginning of 2015 and some German companies have also already expressed interest in the platform.