Snapchat Ad Prices Go from Ungodly to Cheap
Snapchat is/was a coveted place for brands to allocate their
digital marketing budget, especially due to the high volume of users in the
younger age bracket. They offered cool ads like sponsored lenses, with a focus
on integration and seamless content. BUT advertisers couldn’t really measure
the success of the ads, ads couldn’t be repurposed for other platforms, and the
cost was very high (video ads were $750,000).
Now, the ad costs for the platform have been driven down
mainly due to a shift from an ad-sales model of selling to a fully automated
programmatic ad platform. At the end of the month, every kind of ad on Snapchat
will be available programmatically (through auctions), with ad targeting and
measurement. Per the article “Snapchat ads in the first quarter of the year
cost an average of $2.95 per thousand impressions, compared with $4.20 at
Instagram and $5.12 on Facebook's app.” Seems like the traditional media
selling that occurred was bringing in big numbers for only a few brands and
turned off everyone else not willing to take the risk. Now the platform is
operating like Facebook and Google, but it’s still not clear how much revenue
they’ll be able to bring in from this switch. I personally think this was a change
that needed to happen for this growing brand, especially since transparency in
the digital world (even for advertisers) is a concern. Right now, the prices
are very low because of the lack of competition, but the more advertisers
recognize this shift to lower prices, the more demand Snapchat will start to
see. I’m going to keep an eye on their performance in the coming months…
What is the future of this platform? They are rolling
out a Shoppable Ad feature for brands, and they are looking into scheduling ad
buys with “reach and frequency” parameters in the future so they can guarantee
prices and audience sizes.
Great changes in the social media area of digital marketing and
media buying as a whole.
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