Snapchat’s meteoric rise has taken the world by storm as a unique form of social media over the past five years. After the company (officially Snap, Inc.) went public in March, advertising opportunities on the platform have continued to expand. The app houses various options for advertising, including filters, lenses, videos, and interactive experiences that are unlike placements offered elsewhere. The unique advertising possibilities should not deter you from considering how Snapchat can help you reach your marketing and business goals. We’ll walk you through the facts to ponder in making your assessment.
In part 1 of this series on Snapchat for Business we will cover what Snapchat is and the advertising options offered to businesses.
Snap’s stock price has vacillated for a number of reasons. One of them is the question of how effective or valuable its advertising platform is. The truth is, it is highly dependent on the demographic of your target audience, and the creative behind the ad.
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What is Snapchat
Snapchat at its heart is a visual messaging app where users exchange short videos and pictures that disappear after they are viewed. These “snaps” can be sent to anyone in the user’s friend list and also may be uploaded as a story, accessible by all added friends for 24 hours.
Users have the option to utilize filters and lenses in their pictures and videos. This gives a unique and creative twist on typical pictures and videos. The lenses and filters have become so popular that similar options have found their way into Facebook and Instagram. Snapchat also allows for text messages that disappear after being viewed.
Here is Snapchat’s example of a Geofilter:
And a lens:
Snapchat also has “Discovery” sections, with featured news stories (publications such as Daily Mail, Buzzfeed, and Vice), shows, and stories curated by the app featuring notable events going on around the world.
As of July, 2017, Snapchat boasts a daily active user base of 166 million worldwide. It is well-known that snap chatters tend to be younger (teen-25), but the company reports a majority of new daily users as over the age of 25. A recent study by emarketer does a nice job of showing demographics by age and comparing the four largest social media companies for reference:
Snapchat is approaching the number of 12-24 year-old users that Facebook has, so it is immensely popular.
Snapchat does not release gender demographics, but in 2013 the Wall Street Journal uncovered that about 70% of it’s users were female. Take this statistic with a grain of salt as it is difficult to say whether this drastic asymmetry persists given the massive increase in users since.
Geographically, the app is most popular per capita in Ireland, Saudi Arabia, Sweden, India, and the United States. A study by Global Web Index compares country-wide popularity to two other messaging apps. Notice that the US did not make the list for the others, and that Snapchat figures have multiplied since the 2015 study. Also note that Snapchat’s relatively low percentages are attributed to its focus on younger audiences (only 2% of people over 55 have the app), where other messaging apps are not so discriminatory.
The takeaway for demographics? Snapchat is where the kids and young adults are in the US; it is also where the 25-35 year-olds are emerging.
Breakdown of usage
- 71% of users only or mostly chat/snap.
- 24% equally chat/snap, view Discover/Live and follow celebrities/brands.
- 5% only/mostly view Discover/Live and follow celebrities/brands.
Aside from chatting, there are opportunities to advertise through all of these methods. You can purchase lenses and filters in the snap mode, and place video ads in the others.
Furthermore, 63% of users say Snapchat is their primary source for messaging, while short videos was closely trailing by 59%.
Business Profile and Setup
To set up a personal account, the easiest way is to go to the app store and download it. Setting up an account requires minimal information, including your name, phone number, email address, and a username and password. They will ask you for your date of birth, and then you are set to start snapping.
To setup a business account, visit https://forbusiness.snapchat.com/ and provide these same details.
Snapchat Business Uses
Before advertising on Snapchat, take some time to familiarize yourself with the app. Add some friends, explore lenses and filters, and get creative with your pictures and videos.
Get an idea of how the discover sections combine popular news with tutorials and ads. Watch Live stories to get a feel of how large events are broadcasted. After you have become familiar, start thinking critically about how advertising in one or more of Snapchat’s placements might make sense for your brand.
Paid Strategy Ad Types:
There are a number of ways you can get creative with your ads on Snapchat. A sponsored filter is the most common and easiest to use. Filters are stagnant graphics that you can either design on your own or work with Snapchat’s tools and designers to create. Professional-looking graphics backed by tested methods are necessary to get the most out of your placements. When a targeted user is creating a snap, your sponsored filter will come up as an option for them to use in their picture or video. Snapchat then provides statistics for how often your filter or lense was used and viewed.
With this option, get familiar with geotargeting. The Snapchat software operates in an aerial view that allows you to draw a polygon over any area you like, so long as it meets the minimum amount of square feet (20,000). You may set the parameters for date, time, and location.
As of now, the cost per square feet is the same all over the world. This means that running your ad over 20,000 square feet of times square costs the same amount as running it over same square footage in Polebridge, Montana. Population, competition, and events are generally not taken into account in Snapchat’s pricing as of now– so use this to your advantage. 20,000 square feet costs $5/hour. There are rare events that Snapchat has charged a default price of $20,000 for the same area/amount of time. This signals that they are getting smart about reading the demands of certain areas, so take advantage of the current pricing while you can.
Note that some events, like sporting matches, may have closed-off zones. The reasons for this are varied; it may have to do with Snapchat’s desire to limit advertisements at these locations, and there may be occasional licensing issues. For example, Snapchat will not allow you to run a filter at Minneapolis’ US Bank Stadium during next year’s Super Bowl.
Another great feature you will want to take advantage of is the fact that Snapchat’s map is limited to two-dimensions. This means that advertising in an area covering multi-level buildings costs the same amount as advertising over green space, thus multiplying the bang for your buck.
Aside from creating awareness, your filter can include a code that viewers can use to redeem as an incentive to earn their business. If you own a bar near campus, run a filter at the nearby four-story library on the last day of finals, with a code to get the first drink free if they screenshot it!
Lenses are smart graphics that adapt to what is in view. These are engaged when the camera is in selfie mode and a finger is held on the screen. Lenses are reserved for large-budget clients as they come with a minimum $500,000 budget for a day. Snapchat’s programmers create the lenses and in general, only allow them to be run for a day.
Lenses are among the most innovative advancements in advertising present-day. Instead of bearing through, or passively watching your ad, the audience interacts and plays with your ad. It’s a big reason why Snapchat has turned social media, and ad placement, on its head. Take for example, the most successful lens in Snapchat history: Taco Bell’s Cinco de Mayo lens, which racked up 224 million views.
You can create your own videos or utilize an agency. The videos play after stories, in the Discovery content, and in Live event content. Viewers have the choice to skip your video, so the key is to create something eye-catching with a call to action. Insert a link using Snapchat’s Paperclip function in the Vertical Toolkit.
When placing a video advertisement, consider the ad’s purpose. If it is to drive app downloads, the ad may be setup to perform this with a swipe and a tap. If it is to drive traffic to your website, the ad may similarly lead users there and even perform some autofill functions. If you wish to drive awareness, you can simply show a video, with the option of a swipe-up to play a long-form video.
While the app has made strides in its targeting capabilities, it is still not as multifaceted as those offered by Facebook and Instagram. However, it does provide targeting by multiple segments:
Age. This is provided by the user when they create their account. Snapchat provides demographics by age “Buckets” (13-17, 18-24, 25-34, 35+).
Gender. This information is gathered indirectly by Snapchat’s affiliates.
Location. With location services built into the app, targeting can be extremely precise as outlined above; ads can target states, cities, neighborhoods, or even buildings.
Device. Snapchat allows targeting of particular operating systems or device brand.
Context. Ads can be placed in particular chosen Discovery sections (choose from Daily Mail, Vice, BuzzFeed, etc.) or you can place ads among multiple sections (“Bundling”) by choosing themes such as:
User is Connected to Wifi. This is useful when your ad is designed to drive app downloads.
Snap Engagement Audiences. This allows a degree of retargeting. In order to enlist this, a user must first interact with an ad. This means rather than merely watching an ad, the user must use a filter/lens, download an app from a prior ad, or tap/swipe on your company’s previous placement.
Video ads (“Snap Ads”)
This is highly dependent on how targeted your placements are, whether you are taking advantage of retargeting, and the amount of time your video lasts. Generally, video ads can be 3-10 seconds.
These are among the most expensive, with a required $500,000/day spend.
Sponsored Geofilters generally cost about a fifth of the Lenses. $5/20,000 square feet/hour.
Placing a discover feature is a more expensive option, and this is where you will mostly find publications and large brands providing content and making money from their placements within. Recent placements have had a $50,000/day price tag per day, but profits for these placements have been known to reach six or seven figures.
Snap to Unlock Codes
These are a modernized and a more optimistic twist on the failed QR code. Physical ads with the Snapchat Ghost icon and unique surrounding dots allow users to snap the ad and be directed to your site. This is new and the codes themselves are free to generate.
Snap to Unlock Filters and Lenses.
These are like the snap to unlock codes but Instead of unlocking a url, they unlock a special sponsored filter or lens. Pricing is unclear as this rolls out.
Snapchat’s analytics (“Geofilter Metrics”) report impressions, video views (defined as a minimum of 2 seconds viewed or swipe up), quartiles of watch duration (25% viewed, 50% viewed, etc.), watch completion totals, and average screen time.
Spend metrics show effective cost per thousand impressions (eCPM), effective cost per video view (eCPV), total Swipe Ups, Swipe Up rate, effective cost per Swipe Up (eCPSU), average attachment screen time, app installs, app install rate, and effective cost per app install (eCPI). Geofilter Metrics also break down the watch time of Swipe Ups by quartile.
For the more sophisticated analyst, Snapchat’s metrics can be exported to excel files (See their guide on How to Export Reports for Snap Ads).
Marketing optimization companies (like Kenshoo) joined forces with Snapchat to enable you to economize your placements. Agencies that partner with these companies utilize these metrics and expertise to take advantage of the most appropriate and effective opportunities for your particular goals.
Production companies also partner with the app, though you can use your own third-party producers. Snapchat does provide elementary production software called Snap Publisher. It enables you to intuitively create video ads within their site, though as you would expect, is relatively limited in capabilities.
Part 2 in the Snapchat for Business series will cover how Snapchat fits into your high priority marketing goals and building an organic following.
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