Snapchat's new ad initiatives are designed to increase revenue

Snapchat's new ad initiatives are designed to increase revenue
Let's face it, with a valuation that has recently hit $17 billion, Snapchat needs to bring home some bacon before these figures start going in reverse. Drawing people to the app has never been the problem. The question is, how do you turn those eyeballs into cold, hard cash. Mind you, this isn't a problem unique to Snapchap.

Snapchat, which counts 150 million daily active users, has announced a number of new initiatives designed to jump start the revenue stream for the company. Now, when you auto-advance through your friend's Stories, you will see a Snap Ad when you go from the end of one pal's Stories to the beginning of your next bud's Stories. Ten advertisers have agreed to test out these spots including Universal Pictures, Paramount Pictures, Verizon, Procter & Gamble, Warner Bros. and Express.

Snapchat users will soon be able to scroll up on an ad to install a promoted app, view a longer video ad, visit an advertiser's mobile website, or read an ad disguised as a short article. For advertisers, they will be able to use an API created to help them purchase long ad campaigns instead of having to physically negotiate a deal with Snapchat. Despite offering the API, Snapchat says that it will be able to monitor the quality of the ads to protect the app user's experience. 

Snapchat will provide advertisers with metrics to help them determine which ads are working and which aren't This comes out of the messaging app's partnership with a number of analytical firms including Nielsen and Google.

According to Snapchat, its new ad platform results in as much as five times the click-through rate found on similar apps. According to MediaScience, Snap Ads get twice as many clicks as Facebook ads, and 1.3 times Instagram and YouTube ads.

Snapchat reported $33 million in revenue during the fourth quarter of 2015, nearly doubling the previous quarter's total. For 2016, estimates call for Snapchap to bring in $250 million to $350 million in revenue. That would be a nice increase from the $59 million in revenue that the company generated in 2015. The ultimate goal is an IPO to help provide an exit for the Venture Capitalists who have been opening their wallet to the company.
 

source: TechCrunch

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5 Comments

1. AndroidBoy21

Posts: 72; Member since: Dec 29, 2015

Is Snapchat Overrated? PS This is A Genuine Question

4. dickwyn

Posts: 621; Member since: May 07, 2012

It depends on who you are asking, to the younger generation who are part of the "cool gang" snapchat is definitely still in but to others, yeah it might sound overrated.

2. Tziggy14

Posts: 624; Member since: Sep 02, 2014

Ads? And so it begins huh. It was nice knowing you Snapchat.

3. xondk

Posts: 1904; Member since: Mar 25, 2014

Well like most mobile ads, and especially since they are knew, my money is on accidental clicks. And since it is new it isn't getting ad blocked, yet, but that will change.

5. hortizano

Posts: 294; Member since: May 22, 2013

Is there such a thing as people who actually click willfully at ads? Because once this thing hits my device.. is bye bye app...

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