For writers who know little to nothing about Wattpad -- myself included -- it's hard to spot value from using it.
You're giving away perfectly good writing for free, and in the eyes of some publishers, spoiling it for all time in terms of selling it. That alone is a powerful deterrent for many serious writers.
The reality of the site is a little more nuanced, of course, as I have learned in the roughly two months since I started using it.
Wattpad is far more suited toward engagement with other writers and actual writing than other social sites, such as Twitter. (I pick on Twitter because I have used it as a primary social platform for awhile now.) To put it simply, on Twitter you have to beg to get people to read your work. Getting a reader involves someone leaving the platform to actually read your writing. I never had tons of luck snagging readers from Twitter.
On the other hand, it hasn't taken me long at all to get multiple sets of eyes on my work on Wattpad. It does not happen organically, however. Just because you published something on Wattpad doesn't mean that anyone will bother reading it. (And in most cases it is nearly impossible for anyone to run across it via searches.) You have to put in a little effort. This is what Wattpad Community is for.
The Community is not part of the Wattpad mobile app, you have to navigate to it (www.wattpadwriters.com) and log in. It goes without saying you are better off at an honest-to-god computer doing this than your phone's browser, but to each his own. You can get there on a phone browser.
Be prepared to have a massive amount of time swallowed up sifting through the Wattpad Community looking for the right place to start engaging people. As an older writer, I find most of the users are relatively inexperienced teens and college students, so finding a "tribe" is a little more challenging. There are endless threads of nonsense to wade through and it may take you a few tries to land with a group of like-minded writers. Don't skip this step, though. It's pretty much essential to getting anything meaningful out of your Wattpad experience.
Since joining a group, I've garnered hundreds of reads on my work. I get regular feedback and comments. Unlike Twitter, I don't have to beg. I just post my work to the group, and they go in and read it at their leisure. This is the value which Wattpad provides: the ability to get unbiased feedback on your work. And since almost 100% of the writing there is not behind some kind of paywall or purchase (sorry Amazon/Goodreads), you don't have to break your bank or anyone else's to participate.
Wattpad is not without its warts.
As I mentioned before, there are a lot (and I cannot stress A LOT enough) of young writers on Wattpad. There are the usual genres which accompany such youth in droves. If you love brooding vampires, magical fantasy worlds and bi-curious dragons, you'll love Wattpad. If you write in other genres, you're in a minority. Finding readers for non-fiction, literary or historical fiction is challenging on Wattpad.
Wattpad's Community site clearly has had issues in the past and are governed by some strict rules. You can't just go around soliciting for readers. Publishing a link to your story in the wrong thread will result in catching the ire of Wattpad's version of the Eye of Sauron, the Community Ambassadors. There are stern talkings-to, post removals and other harsh things to follow. Learn what is acceptable and where to post things before diving in with both feet.
Probably the biggest strike against Wattpad is how often some of the functions are broken on the site. Since I have joined, I have not witnessed their tagging system work the way it should, for instance. The stats on your story reads and votes are often wrong, out-of-sync or incomplete. Usually those things fall more into the "annoying" category, but on occasion they are downright frustrating.
One of my personal complaints about Wattpad is the very limited options you have for formatting your story when you post it there. I want my stories to look a specific way in terms of readability (short paragraphs which are easy to discern from the next paragraph). Wattpad makes it tough on me and I've messed up a few drafts battling the formatting.
And Then There's That "First Rights" Publishing Thing
This is probably the most frightening thing about Wattpad for a new writer or someone who's looking to be published. It scared me off for more than a year. I didn't want to screw up my chances with an awesome work by giving it away on Wattpad.
I do think there are publishers who absolutely would reject a work solely on the grounds that it had been available on Wattpad. I think there are other publishers who would realize that Wattpad readers are not people who generally buy books in the first place and you haven't done a thing to the marketability of your work.
Honestly, this is a judgment call, and one you need to make personally. For me, the value of having readers is outweighing my fears about "ruining" the publishing rights to the work. I still have things to learn, and Wattpad is a good place to learn without the pain of a rejection letter.
People make a big deal out of it, but in realistic terms, your chances of being published traditionally are rather slim to begin with. And probably just north of zero without some honest, unbiased feedback to help you hone your craft.
I am pretty happy with my experiences so far, I'd love to hear about yours.