Snapchat flags new media law’s unintended impact on social commerce

Australian retailers with tween and teen consumer demographics could be forced to pivot their marketing strategies when a blanket ban on social media for those under the age of 16 comes into effect on November 28 next year.

While the ban aims to reduce the negative impact of social media use on children, the indirect ramifications on brands and retailers could pose a major problem, requiring marketing managers to rethink content strategies across the board.

Now, social media platforms are racing against the clock to ensure they comply with the Online Safety Amendment (Social Media Minimum Age) Bill 2024 (“the Bill”) when it comes into effect. National trials of the legislation will be in place from January.

It’s not yet clear which platforms will need to comply with the legislation, but those that do will be confronted with fines of up to $49.5 million. 

What’s retail got to do with it?

So far, the response to the legislation has mostly focused on the potential benefits and drawbacks of blocking children and young teens from using social media, including privacy concerns and the impact on social connection. However, there are also business implications.

The gross merchandise value (GMV) generated by Australian social commerce was US$1.63 billion in 2023 and is tipped to reach US$2.95 billion by 2029.

The digital lives of Aussie teens, a 2021 report by the Australian government’s eSafety Commissioner, showed that 54 per cent of teens aged 12-17 banked and shopped online. This increased to 65 per cent in the 14-17 year-old demographic.

The report found that teens used an average of four social media platforms; the top three most used being YouTube, Instagram and Facebook. 

TikTok, which launched in Australia in 2019, is the social media app Australians spend the most time on each month, according to Meltwater and We Are Social’s Global Digital Report.

While Snapchat doesn’t feature in the top three platforms, it has over 8 million active users in Australia and reaches 90 per cent of the nation’s 13-24-year-old population.

Snapchat

Before the law was passed, Snapchat provided a submission to the Senate inquiry highlighting its concerns over the rushed nature of the legislative process.

“Alongside numerous academics and experts including the Privacy Commissioner and the Human Rights Commissioner, we have raised serious concerns about the legislation,” a Snapchat spokesperson told Inside Retail.

“While there are many unanswered questions about how this law will be implemented in practice, we will engage closely with the Government and the eSafety Commissioner during the 12-month implementation period to help develop an approach that balances privacy, safety and practicality,” the spokesperson said.

“As always, Snap will comply with any applicable laws and regulations in Australia.” 

The company’s submission reiterated that the platform has extra safeguards for teens and noted that the legislation would require all users of “age-restricted social media platforms” – not just young people – to verify their age. 

“Previous international attempts at broad, mandatory age verification have failed due to concerns around privacy, security, proportionality, and technical challenges,” the platform’s submission stated.

Unintended consequences

Another potential knock-on effect that Snap highlighted in its submission was the possibility of a blanket ban on mainstream social media driving young people to “less regulated and more dangerous online spaces than the mainstream, highly regulated platforms covered by the Bill”.

The Australian and New Zealand Children’s Commissioners, Guardians and Advocates (ANZCCGA) said that insufficient time for thorough consideration and consultation surrounding the legislation has left a vast scope for the potential unintended consequences.

Jodie Griffiths-Cook, the ACT’s  Public Advocate and Children and Young People Commissioner said, “Despite the extensive media coverage and public debate surrounding the social media ban for children under 16 years, a significant oversight prevails: the rights and views of children and young people have often been marginalised in this discussion.”

Zoë Robinson, NSW Advocate for Children and Young People said, “Children and young people have expressed their concerns to us about how these restrictions will affect them and have also offered their thoughts about how to keep them safe online. We need to acknowledge their solutions and ideas and then respond accordingly.

“By working together, we can help our children stay safe in the digital world and ensure it is an inclusive space that empowers them and supports their development.”

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