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The Curious Case of Snapchat Advertising

The Curious Case of Snapchat Advertising

Snapchat has long been a double-edged sword for brands looking to reach Millennials over the picture and video messaging service. On one hand, the app boasts over 100 million active daily users, most of them Millennials, but on the other hand, Snapchat offers very limited data on these users compared to other social media channels. On top of restricted reporting, Snapchat advertising also carries high prices and major limitations when it comes to targeting audiences, which has scared potential partners away. Today, clients demand to see ROI, and Snapchat simply does not offer the metrics that marketers are looking for.

However, some brands haven’t been afraid to experiment with Snapchat advertising. Coca-Cola revealed that they were able to see an upward trend in engagement through the platform by adjusting their advertising and tailoring its content to the app. Toyota has also launched a campaign targeting young drivers buying their first car. Audi even claims to have run the world’s first successful Snapchat advertising campaign on the grandest of scales—during the Superbowl in 2014.

Snapchat is defined as a “unicorn” or a privately held company that is valued at over $1 billion, and is currently the 5th most valuable privately held company in the world. But it hasn’t been all smooth sailing for the app. Recently, Fidelity lowered its valuation of the app by about 25%, illustrating Snapchat’s struggle to monetize their popularity. The company is still valued at $16 billion, which isn’t too shabby considering CEO Evan Spiegel turned down an acquisition offer from Facebook in 2013 worth $3 billion.

Recently, however, it seems that the Snapchat advertising department is working to solve these problems and eliminate concern. They are developing their own application programming interface (API) which allows advertisers to purchase more ads with greater precision and more functionality in these ads. Ultimately, this is a move to help Snapchat measure the effectiveness of the ads being run, and pass this information along to marketers. They are taking a page out of Facebook’s, Twitter’s, and Instagram’s books, who all have API technology of their own.

Despite all of the recent accomplishments, Snapchat is still in the early stages of figuring out the best way to advertise on their platform and build relationships with advertisers. Only time will tell if Snapchat can rid itself of these advertising woes, but it certainly has the audience, and it seems they are headed in the right direction.