Our favourite Venice beach company, Snap, appears to have miscalculated the demand of their $180 camera-equipped glasses.
The Information reports that despite Snap CEO Evan Spiegel’s claim that they sold beyond expectation, the company has “hundreds of thousands” of assembled and unassembled Spectacles sitting in warehouses in China that may never find buyers.
The company’s executives had apparently been fooled by the early mania around the device during its carefully stage-managed roll-out.
It seemed much of the appeal of the device was, however, its short supply, as demand disappeared as soon as one could walk into Walmart and walk out with a set, even after the price was dropped to only $129.
Spiegel appeared unconcerned, saying it “maybe a decade” before the Spectacles product was important to Snap. This may be how long it would take to sell through their current inventory of Spectacles but it is unclear if the company has this long.
Their user growth has plateaued, leading them to argue that they may not have more users, but they have “better quality” users than rival Facebook, who had copied their features wholesale and applied them to all their messaging apps, from Instagram to WhatsApp.
Snap’s share price has also halved from its IPO high and the $2.8 billion in cash on hand the company had in June is rapidly disappearing. Spiegel may look one day look back fondly on Mark Zuckerberg’s 2013 offer to buy out the company for $3 billion.
Like Snapchat Spectacles, the company may turn out to be a flash in the pan.