This article was published on November 23, 2015

Snapchat starts bundling up users and slashing ad costs in a bid to get more advertisers on side


Snapchat starts bundling up users and slashing ad costs in a bid to get more advertisers on side

Since its launch on iOS in 2011, Snapchat has amassed more than 100 million users, which is obviously an appealing stat for eyeball-hungry brands. In response this growing demand, the company has now started packaging audiences by themes for advertisers.

Yes, Snapchat has popped you in a hypothetically-themed box for advertisers to sell their ads to you.

The aim of the audience bundles is to let advertisers match their content to the most appropriate people using the Discover channel. For example, if an advertiser chooses a ‘world news’ package, the ads will be featured within the likes of CNN and Vice’s content channels. Or if an advertiser is looking to reach a creative audience and purchases a ‘culture’ package, its ads could be shown on the likes of Hearst’s new Sweet channel.

This sounds better than just randomly placing ads on all sorts of Discover channels, but it’s still lacking in the type of data that advertisers use to measure success, like click-through rates. That being said, it’s a promising sign that Snapchat is at least trying to create more audience-friendly brand experiences on its app.

The move is interesting as just last week, some investors were questioning the true valuation of Snapchat. The company doesn’t comment publicly on its revenue (or losses), but as Recode reported earlier this year, it could reach $50 million by the end of 2015.

The company has also slashed its ad costs from $700,000 to $100,000 as an additional temptation for advertisers.

Even at $100,000, Snapchat will need to up its game in terms of analytics because Instagram is undoubtedly a competitor in this space and with the capability of using Facebook’s powerful targeting tools, it will be hard to beat.

Snapchat has successfully helped ads become innovative again since its Discover channel came to life, so if lower prices and better audience targeting can get more advertisers on board, it could certainly become a force to be reckoned with.

➤ Snapchat opens the door to audience targeting [DigiDay]

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