Snapchat has become one of the most popular social media platforms, especially among younger demographics. With over 265 million daily active users, Snapchat offers a unique opportunity for brands to reach a highly engaged audience. One of the main ways brands can leverage Snapchat is through advertising. But how profitable are Snapchat ads? Let’s take a closer look.
Snapchat’s Advertising Options
Snapchat offers a variety of ad formats for businesses to choose from:
- Snap Ads – Full screen vertical video ads that appear between stories.
- Filters and Lenses – Sponsored filters and lenses that users can apply to their snaps.
- Commercials – Unskippable 6-second video ads that play between shows in the Discover section.
- Collection Ads – Scrollable ads that showcase multiple products.
- Story Ads – Sequential full screen ads that tell a story.
These options allow advertisers to showcase their brand in creative and engaging ways. Snap Ads, Commercials, and Story Ads tend to have the widest reach, while sponsored lenses and filters enable more interactive experiences.
Snapchat’s User Demographics
One major reason Snapchat ads can be lucrative is because of the platform’s user demographics. According to Snapchat, as of 2022:
- 90% of daily active users are between the ages of 13 and 34
- 75% of users are between the ages of 13 and 24
- Over 40% of users have an annual household income of over $50k
This means Snapchat provides access to the valuable Gen Z and millennial demographics. These younger users also tend to be early adopters who influence trends.
Snapchat Ad Targeting Options
Snapchat provides robust targeting capabilities to help advertisers reach their ideal audiences:
- Demographics – Target by age, gender, location, languages, and more.
- Interests and Behaviors – Target based on interests like entertainment, fashion, and sports, as well as purchase behaviors, device usage, and more.
- Custom Audiences – Target specific groups like existing customers by uploading contact lists.
- Lookalike Audiences– Reach new audiences that share qualities with an existing customer base.
Detailed targeting allows businesses to serve ads to the Snapchatters most likely to engage with their brand and products.
Snapchat Ad Performance
So how well do Snapchat ads perform? Here are some key metrics:
- Snapchat claims the average view time for Commercials is over 90% complete, highlighting the engaged user base.
- Lens campaigns drove a 19% lift in ad awareness and 34% lift in message association in Nielsen studies.
- Snapchat says over 75% of its 13-34 year-old users take action after seeing an ad.
- Snap Ads have an average swipe up rate of 6.1% according to Socialinsider, much higher than the industry benchmark of 1-2%.
These statistics indicate Snapchat ads are outpacing industry averages when it comes to driving results.
Cost of Snapchat Advertising
So how much do Snapchat ads cost? Pricing is determined by the target audience size and ad format:
Ad Format | Pricing |
---|---|
Snap Ads | $1 – $3 CPM on average |
Commercials | $20 – $40 CPM |
Sponsored Lenses | $450,000+ for 1 day nationwide lens |
Sponsored Filters | $50,000 – $75,000 for 1 day nationwide filter |
Story Ads | $2 – $3 CPM on average |
Snapchat notes that Commercials and Sponsorships like Lenses and Filters are more premium offerings intended to drive brand awareness, while Snap Ads and Story Ads optimize for conversions and direct response.
Pros of Snapchat Advertising
Here are some of the key benefits of Snapchat ads:
- Reach a young, engaged audience
- Grab attention with full screen vertical video ads
- Leverage interactive ad formats like Lenses
- Drive measurable actions and conversions
- Target users based on advanced attributes
- Frequency capping avoids oversaturating users
- Relatively affordable cost per impression
- Creative ad formats help brands storytell
Cons of Snapchat Advertising
Some potential downsides to consider include:
- Narrower audience skewed towards teens and young adults
- Sponsored Lenses and Filters come with high price tags
- Commercials cannot be skipped causing user irritation
- Vertical video ads don’t work for all campaigns
- Measuring ROI can be difficult
Tips for Success with Snapchat Ads
Here are some tips to help maximize the return from Snapchat ad campaigns:
- Leverage Snapchat’s unique ad formats for innovative campaigns
- Target Snapchatters likely to engage based on interests and behaviors
- Test different objectives like traffic or conversions
- Use Commercials to share engaging stories about your brand
- Add interactive elements to ads like polls, questions, etc.
- Retarget engaged users from Custom Audiences
- Measure performance not just impressions
- Rotate creatives frequently to keep content fresh
Case Study: Wendy’s Snapchat Campaign
In 2017, Wendy’s launched a Geofilter campaign to promote their new “Internet Famous” chicken tenders. The Geofilters were available at select restaurants where the new menu item was being tested.
Results of the Snapchat campaign:
- The Sponsored Geofilters generated over 224 million views.
- There was a 31% increase in foot traffic to participating restaurants.
- Brand lift surveys showed 75% awareness of the new product among Snapchat users.
- The increase in foot traffic drove an overall sales lift of approximately 18%.
This example demonstrates how a strategic Snapchat campaign that targeted users near specific locations generated impressive results for Wendy’s new product launch.
Conclusion
Snapchat advertising provides a unique opportunity for brands to engage users in a fun, interactive environment. While certain ad units like lenses and filters come at a premium, there are also very affordable options that deliver high impression and engagement rates compared to other platforms.
Snapchat should be strongly considered by brands targeting younger demographics, especially those selling products aligned with interests like entertainment, fashion, and consumer electronics. With thoughtful targeting and compelling ad creative optimized for the platform, Snapchat offers significant potential for driving brand awareness, store visits, app installs, and sales.