Snapchat Abandons Its Past Ad Practices
After a dismal first year as a public company, Snapchat is looking to turn a profit by testing 6 second unskippable ‘Commercials’ on select Snapchat Shows starting in mid-May.
This announcement may come as an unwanted surprise to users who are used to skipping through ads as much as they want. Exchanging ads for free content has become so ingrained in our culture that we’re pretty much numb to it but Snapchat, however, has always been reluctant to force ads on its users.
They have tried their utmost to appeal to fans by making ads an optional experience and up until recently, they managed to coast by unscathed on that method. However, after going public, their skippable ad policy came with some significant consequences. They suffered a loss of $720 million last year and analysts predict that that looming number will continue to rise this year.
As if the sizable profit loss wasn’t enough, Snapchat was plunged into a world of hurt in February when they unleashed their newly redesigned app on unsuspecting audiences.
Snapchat’s Tumultuous Year
The redesign was loathed for its radical and unorganized layout changes and complaints ran rampant on social media. Celebrity influencer and avid Snapchatter Kylie Jenner slammed the redesign and a Change.org petition demanding the old Snapchat be brought back received over 1.2 million signatures.
The poorly designed layout, the highly publicized petition, and Kylie’s massive influence caused Snap’s stocks to sink 6%, clearing $1.3bn from its market cap.
Over the next few months, Snapchat started slowly introducing new features that resembled the way the app used to function and yesterday, they announced that they would be tweaking the redesign once again. This shows that Snapchat is willing to listen to fans but after yesterday’s announcement, the company’s stock sank 8%.
Snapchat has been left with minimal profit churning options and although mandatory ads counter the company’s previous practices, the ‘Commercials’ may help Snapchat recover from sinking profits and low stocks.
Will Users Buy Into Mandatory Ads?
It’s unclear how Snapchat users will react to the unskippable ads. According to a 2017 study by Fluent, “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.”
Based on these statistics, there’s a chance mandatory ads could turn off users, hurting both the show producers and advertisers.
The company understands this and have decided to ease into the new ad system slowly. The ‘Commercials’ will only feature in the Discover section on Snapchat Shows like MTV’s Girl Code and Cribs and won’t interfere with friend or publisher snaps or stories. Essentially, they will work like the traditional commercials we see on TV, only blissfully shorter.
A Golden Opportunity for Advertisers
Whether or not users will power through the ads will depend on how engaging the ads actually are. Snapchat is all about short, fun, and creative content and ads that can simultaneously inform and entertain in six seconds or less will have a better chance of winning over Snapchat’s core demographic (the 18-34 crowd).
If the new ad tests go well and mandatory ads become a permanent fixture on Snapchat’s growing library of Shows, advertisers could expand their reach and earn more clicks. In a world of unlimited content, visibility is vital for marketing survival.
From the perspective of a user, the idea of unskippable ads is frustrating to say the least but from the perspective of a marketer, it’s a golden opportunity to get more branded content in front of more faces.
Snapchat has given us, content marketers, promoters, and advertisers, a platform but it’s up to us to create content worth watching. If an unskippable ad sucks, users will get annoyed, frustrated, and most likely share their displeasure loudly and publicly on social media.
The benefits are high for unskippable content but so are the stakes. Spending more time in the brainstorming and creative stages is way better than switching into damage control mode.
Whether or not we start creating short form ads for Snapchat or other platforms, we’d all be wise to remember that bad content is far worse than no content.
Have you used Snapchat for marketing? Share your experiences in the comments.