WITH its advertising revenue expected to fall, Snapchat is under pressure to convince marketers of its viability as an attractive platform for brands looking to get noticed.
The popular social media app has introduced a new program named Snap Accelerate, aimed at VC-backed mobile startups hoping to up their advertising game. The program offers startups discounted benefit packages which include a range of advertising services with a value of up to US$100,000.
Such benefits include credits to use for buying ads, free branded filters, invitations to Snap-hosted educational events, and business and technical support from Snapchat.
In order to have a chance to take advantage of these business-boosting benefits, startups must go through the application process and prove themselves to be at a stage of growth.
Snapchat appears to be following in the footsteps of key advertising platforms Facebook, YouTube and Instagram.
Marketing Land quoted Mike Dossett, associate director of digital strategy at California-based marketing agency RPA, as saying the reason these social media giants are classed as “must-haves” in the marketing world is because they “provide the right tools, the access to audience, as well as ad-tech and measurement capabilities”.
However, Snapchat is yet to prove it belong in the same company.
“Snapchat… they don’t fall into that category today in the eyes of most clients,” said Dossett.
Up until now, Snapchat’s ad-targeting options have drawn criticism for being too basic, aiming at age, gender, location, and mobile device type. However, Snapchat has now upped its game, providing options such as the use of third-party purchase data to target ads.
“The breadth of targeting they’re now bringing to market is a big change and at least keeps them in the consideration list,” said Dossett.
“Whereas before maybe they got in on pure scale, now they’re starting to earn their right to be in consideration based on their targeting chops as well.”
Following the Facebook model
According to Marketing Land, the Snap Accelerate program follows the efforts of 2012 Facebook in terms of relying on mobile startup companies to build up its mobile advertising business and conquer concerns over advertising.
In July, Facebook reported advertising revenue of US$9.16 billion in the second quarter of 2017, a 47 percent increase over the same quarter last year.
Through Snapchat’s new program, startups can get access to a whole range of advertising tools for free. However, it is not just the startups who gain. By targeting startups, Snapchat is essentially telling them their ads can help their company grow its user bases and therefore their business.
If successful, those companies will not only have more money to spend on advertising, but will also be more likely to spend that money on Snapchat’s ads, in turn converting them to long-term partners.
Snapchat’s recent efforts to attract more marketers stems from their recent Wall Street disappointment, where its first earnings report revealed US$149.6 million in revenue compared to the US$158 million expectations. Losses also mounted to US$2.2 billion in Q1, up from US$104 million a year earlier.