It wasn’t so long ago that a software update caused a humungous backlash among Snapchat’s most loyal users – many of whom deleted the app, causing the stock to fall by 6% and $1.3 billion to be wiped off the company’s market value.
Ouch. So, where has this left them? Well, at least in terms of advertising many brands have been left pretty unconvinced at the platform’s continued profitability.
Snapchat first introduced advertising on its platform two years ago, allowing the unexplored opportunity of marketing that centred around the use of the smartphone camera.
Now, while many advertisers might consider Snapchat to be ‘damaged goods’, there is still a potential to tap into 191 million-odd daily users.
So, how can businesses reach consumers?
Snapchat offers advertisers multiple channels to reach consumers – from sponsored geo-filters and video content, to shoppable augmented reality posts.
The current advertising costs range from $7 – $500,000, catering to budgets and needs of brands both big and small.
According to a report by Social Media Examiner, only 8% of marketers used the Snapchat platform in the first quarter of 2018. More telling is the stat that 72% explained they had no plans to continue to use the platform in the next 12 months. Crying face emoji.
So, how do those figures stack up in comparison to other social media platforms?
Well, by contrast 94% of marketers are using Facebook, 66% Instagram, 62% Twitter, 56% LinkedIn, 50% YouTube and 26% Pinterest. Which means Snapchat are trailing massively – and need to step up in order to attract and retain advertisers.
In exciting news for advertisers, Snapchat is trialling six-second forced view ads and ‘unskippable’ ads in its Discover section. With the aforementioned 191 million odd daily users each spending an average of 25 to 30 minutes consuming content and sending photos, every day, the potential exposure for brands is enormous!
UK companies are embracing the Snapchat advertising opportunity, like the hyenas we are! The UK sector accounted for around 10% of Snapchat’s overall ad revenue. According to eMarketer, the firm is set to make £105 million just from UK ad revenue this year, almost double the figure in 2017.
What Snapchat does have going for it is augmented reality.
Three UK is one of many brands investing vast sums of money into the platform in this regard. In May, the firm introduced the world’s first AR Snapchat emoji pet…..the ‘Puggerfly’. I guarantee we cringed harder than you did the first time we said that name out loud, so man up and keep reading.
While spending $500,000 a day on Snapchat’s sponsored lens is a reasonable investment for huge brands with enormous budgets, it isn’t feasible for smaller brands – but WAIT – there are other options! Snapchat’s local geo-filter costs around $7 to run, while Snap Ads, which consist of videos up to 10 seconds in the Discover tab, cost around $1,000.
Despite all the negative press and a bumpy start to the year, Snapchat’s global revenue grew by more than 50% to $230.7m in the first quarter of 2018. So what’s all the fuss about? Well, it wasn’t all good news, as users only increased by 2%, compared to 5% during the last quarter of 2017.
With a multitude of advertising opportunities, and Snapchat continuing to create new opportunities for advertisers, in a reasonable price range, is it worth an investment?
We think so, and Snapchat – sit tight, it’s not as bad it seems. You’ll be alright.