Snapchat rolled out its marketing program with notably high price tags. And although it introduced some lower-cost options, they are by no means cheap, especially since Snapchat is usually used for branding, not direct return on investment plays. Plus, the ads are vertical, so advertisers typically have to invest in custom creative to take advantage of Snapchat’s fun and irreverent tone.
Let’s take a closer look at the platform’s advertising options and what they could mean for brands that can’t afford to spend hundreds of thousands of dollars on a single-day campaign.
Snapchat announced the launch of its ads application-programming interface in June, which signified to the world, and investors, that the platform was getting serious about expanding its advertising options.
It also meant that, for the first time, Snapchat ads could be sold by third parties. Before the announcement, Snapchat was selling its premium ad inventory directly, usually in the range of $40 to $60 CPMs (cost per thousand impressions). Some brands spent as much as $750,000 for just a 24-hour window.
Over the past year, Snapchat has dropped its prices. It now offers programs that start at around $50,000, which, coupled with the API, suggests that Snapchat wants to make it easier for more buyers to test out the platform.
No doubt, it’s scaling its advertising program. While elite advertisers with deep pockets will probably generate the bulk of its revenue, Snapchat wants to monetize a greater percentage of its inventory.
Snapchat’s selling points and shortcomings
What Snapchat has going for it is its engaged user base and its hold on the teen and 20-something market. It reaches 41 percent of all 18- to 34-year-olds in the U.S., a figure it proudly touts on its website.
Snapchat also says that the swipe-up rate for Snap Ads is five times greater than the click-through rate on other social media sites. Daily users spend 25 to 30 minutes on the application, and more than 66 percent of Snapchat’s 150 million users post every day.
Engagement is the keyword for both Snapchat sales folks and the brands that jump on board. The most effective Snapchat campaigns are silly, entertaining and sometimes even mindless.
For example, on Cinco de Mayo, Taco Bell released a sponsored lens that turned people’s heads into giant taco shells. It garnered 224 million views in a single day. The average user engaged with it for 24 seconds before sharing with friends.
Gatorade’s Super Bowl lens, which let users pour an icy bucket of the sports drink over their heads, was viewed more than 165 million times and reportedly produced an eight-point jump in purchase intent.
Although those campaigns were fleeting, the resulting media and social media coverage ensured that their effects were more than temporary.
Snapchat advertising isn’t without its flaws. There is no advanced targeting yet. And although 150 million global daily users is impressive, it is peanuts compared to Facebook’s 1 billion-plus user base, which also boasts more diverse demographics.
The platform lacks sophistication and reporting capabilities, and you won’t know much about the people who viewed your ad. And of course, you are probably not going to consider the investment if you are not interested in that 18- to 34-year-old market, although Snapchat’s audience is becoming more diverse.
Snapchat for smaller advertisers
While the barrier to entry has been lowered, advertising on Snapchat is still out of reach for many brands. It’s best reserved for companies with a clear branding objective, an authentic voice and a willingness to take risks and have fun.
Brands interested in reaching Snapchat’s audience but not ready or able to shell out the big bucks can try managing their own Snapchat feeds. This still requires resources, but it can be cheaper than an ad.
The Los Angeles County Museum of Art uses Snapchat particularly well as part of its effort to appeal to an audience of younger Angelenos. In its feed, it combines works of art from its collection with current song lyrics or jokes in a way that seems like it was created by a young person. It’s in-the-know and nuanced enough to be just right, and it has been covered by a ton of publications, drawing more users in specifically to view this content, driving awareness and the “cool-factor” of the museum.
But perfect execution isn’t an option for every marketer. More accessible to many is product placement in influencer reviews, which can help brands both create and distribute their content. They can partner with tastemakers to create content that feels genuine, and reach new users—the influencer’s audience.
By nature, the content is ethereal and time-constricted (no more than 10-seconds), but brands benefit from Snapchat’s high engagement rates and the influencer’s credibility. Price varies, depending on the influencer and the size of his or her following, and sometimes advertisers use a performance-based pricing model in which compensation is tied to metrics like views, clicks and conversions.
The custom content ‘problem’
The Snapchat audience rewards creativity and authenticity. The fact that it is hard to reuse content on Snapchat due to the vertical requirements could actually be a blessing in disguise for marketers.
Creative customization often breeds better results than reusing existing material, as tempting as that might be. Snapchat success stories are always tailor-made to the platform and often leverage its unique tools and interactive features. It is likely that lower-priced ads will be less customizable, but advertisers can still maximize results by tailoring their video for their target audience and remembering the type of content that performs best on the platform.
Customizing digital creative is always best practice. For example, cutting a television commercial to fit a 15-second digital video spot is usually like jamming a round peg into a square hole. But tailoring content on Snapchat is a must. This makes using the platform more expensive, but it also makes it more likely that you’ll create something that works.
Snapchat advertising is a big investment, and it is not going to become the norm for every advertiser. But for brands with big budgets and/or a clear need to target young consumers, a Snapchat play can make sense—as long as it’s backed by the requisite investment in custom creative.