A little over two months after reaching 5 million paid users, Snapchat+ has crossed another key milestone: $20 million in monthly revenue. We’ve been tracking its rise as an exemplar in the growing subscription movement, and it continues to be a model for how content publishers can pull this off.

Whereas most of our reported milestones so far have come from Snap’s own announcements (usually framed in the number of subscribers), the $20 million figures comes from app analytics firm Apptopia. Though it’s not first-party analytics, it’s a trustworthy source of extrapolated data based on app usage.

Applying a rough run-rate to this figure, the $3.99 per month Snapchat+ has added about $240 million to Snap’s annual top line. At about 5 percent of Snap’s total revenue, this is marginal but meaningful in that it represents a move towards diversification at a time when ad revenue is under fire.

Those ad revenue challenges include privacy reform – both legislative and private-sector platform restrictions. Challenges facing ad-supported businesses also include an economic downturn, which tends to retract brand ad budgets. Lastly, the supply side is more populated these days (read: TikTok).

Sweet Spot

Altogether, the timing is not only opportune for subscriptions like Snapchat+, but Snap’s execution has been on target. Comparatively, the same success hasn’t been seen from competing efforts like X Premium (formerly Twitter Blue). This means Snap has found the sweet spot for paid social features.

So what does that feature set look like and what’s the value being offered to subscribers? It’s mostly exclusive VIP-like perks, such as access to new features on Snapchat. And the price is right. At $3.99 per month, it seems to strike the right value exchange for Snapchat power users… 5 million of them.

Meanwhile, a main selling point is detailed analytics on published Stories. With this, subscribers can see who rewatched a given story… a real attraction for influencers and brand marketers that wish to optimize content or re-retarget audiences. Given these high stakes, a few bucks per month can be a steal.

Another fan favorite is “sticky” above-the-fold comments on other Snapchat users’ Stories. In other words, comments float right to the top. So in crowded message threads for celebrity Stories, some Snapchat+ subscribers (think: pop culture junkies) gladly hand over $3.99 per month for this exposure.

To further sweeten the deal, Snap continues to infuse fresh features such as Snapchat web access, exclusive Bitmoji skins, and UX customizations such as pinning profiles of close friends. Bottom line:  Snap’s feature mix – and its 5 million subscribers – is the score to beat for social app subscriptions.

Ep. 11 Examines BigTech’s Old Shiny New Thing — Subscriptions

Ongoing Question

Stepping back, what’s the lesson in all of this? There’s been an ongoing question in the tech and media worlds: Will consumers pay for content? After the internet age unleashed previously-paid content such as news, one argument is that you can’t put the genie back in the bottle. And there’s some truth to that

Meanwile, the privacy-forward era has cracked down on the previous decade’s runaway train that is ad tech. This has caused the momentum to swing back toward paid content, with the message to users that you can pay with your wallet rather than your data (though there’s some contrarian evidence out there).

In fairness, those that have pulled off subscription models are few in number, including the New York Times and Wall Street Journal. These are premium products – one common trait for paid content. But the lesson stands: There continues to be a shift away from advertising and towards revenue diversification.

Beyond news – and other entertainment from iTunes and Spotify – we’re seeing positive signs from a range of apps that are erecting paywalls. We can add social apps to that list, with Snapchat+ as the examplar. Will other apps (and content categories) follow? We’re looking at you TikTok.

Stay tuned for a Localogy report that goes further into depth on this trend towards subscription revenue models…