When Snapchat announced back in April that was planning on testing and later launching unskippable six-second spots on its Shows analysts were anxious to see what the net impact of this move was going to be.
Snapchat has had a tough time getting people to watch ads on the platform. A 2017 study by customer acquisition firm Fluent found that 69 percent of Americans “always” or “often” skip ads on the app, a figure that goes up to 80 percent for 18- to 24-year-olds, the key Snapchat audience and one that’s highly coveted by advertisers.
On one hand it is hard to argue the business need to monetize on its growing user base, and the ads inserted in the middle of shows, similarly to traditional TV, are one way to do it, but on the other, forcing users to watch ads for products such as Samsung's Galaxy S9 and Snapple could turn them off further, to the detriment of the advertisers and the shows’ producers.
It remains to be seen what the net impact on Snapchat the new ads are going to have? Will they bring the company on the path to profitability, or will they plunge it into even greater despair as users scatter? The Wall Street and digital advertisers will be watching closely.
Sources:
http://adage.com/article/digital/snapchat-starts-showing-ads-viewers-skip/313509/
https://digiday.com/media/unskippable-six-second-video-ads-coming-snapchat/
