To compete more effectively with other social media platforms such as Facebook, Instagram, and Twitter, Snapchat is enhancing the advertising experience it offers to retailers. Buoyed by its new partnership with Nielsen, Snapchat will now allow brands to purchase targeted advertisements, using customer data collected by Snapchat as well as data obtained from offline sources.

Nielsen Buyer Insights and Nielsen Catalina Solutions can track information about which consumers have recently purchased lipstick at a retail store using a loyalty card; advertisers hope to access this information to make better decisions. With the new agreement, they can combine it with data from the social media platform to determine which Snapchat users to target in digital marketing campaigns.

Snapchat’s decision to share more user data with advertisers comes at a time when Facebook is scaling back on targeted advertisings, amid user privacy concerns. This contrary move could make Snapchat more appealing to advertisers looking to spend their digital marketing campaign dollars on narrow, targeted campaigns.

In addition to making more user data available to advertisers, Snapchat is changing the way ads can be purchased and presented on its platform. The service will soon start to offer six-second, unskippable ads.

Finally, Snapchat is working to align advertisers with its new premium programming. Snapchat’s media section, Discovery, broadcasts entertainment and shows that reach more than 30 million viewers each month. Advertisers are able to arrange advertisements to play during specific shows and on specific channels. The content on Discovery is produced by professional publishers only, so advertisers will have greater control over where their messages play, compared with other platforms that include ads in (often controversial) content published by users.

As a result of these enhancements to the platform, Snapchat believes that the value it offers advertisers is worth a premium price. In turn, it is expected to raise advertising rates soon, from between $3 and $5 per 1000 impressions to close to $10 for the same view rate.

Discussion Questions:

1. What are some benefits to advertising on Snapchat compared with other social media platforms?
2. How will this new marketplace improve advertising on Snapchat?
3. Will Snapchat’s deal with Nielsen improve its ad targeting? Why or why not?

Source: George Slefo, “Snapchat Beefs Up Ad Targeting in Deal with Nielsen,” Ad Age, July 18, 2018; Garett Sloane, “Snapchat Opens a Private Marketplace for Brands to Buy Ads in Discover Shows,” Ad Age, July 25, 2018