As part of my day job running Firebrand Group, the digital consultancy, I often get questions about whether or not Snapchat's has a monetization strategy, and whether or not small businesses should be paying attention. The answers, in short, are yes and yes. Snapchat Discover and Branded Geofilters are two parts of Snapchat’s future that small businesses should be paying attention to.
Snapchat encourages brand involvement with Snapchat Discover, a feature that allows users to explore stories from brands--primarily editorially driven publishers such as CNN and Comedy Central. This feature puts the focus on storytelling instead of promotion, giving users access to traditional editorial outlets instead of another annoying ad.
Given the app's growing popularity with the valuable Millennial market, agencies and brands are willing to work around the sometimes-difficult advertising model. Companies like Vice and Comedy Central have started using Discover channels, a feature that allows users to peruse branded content.
Rather than repackaging existing content, original content is launching on Snapchat as well. For example, TV network Fusion is debuting five original shows exclusively for its Discover channel. In the age of on-demand binge watching, it seems that bringing instant television to Snapchat is a natural progression in a market where users are quickly devouring video content. Fusion's shows will air six two- to three-minute episodes a piece.
One of Snapchat's more exciting new features is the ability for users to share articles and videos from Discover with your Snapchat friends. When users find a piece of content they want to share, they press their screen and wait for the new tool menu to appear. As with a normal snap, users can type a caption or draw with the virtual marker.
At present, Discover sponsorships may be outside of the range of small businesses (they can reportedly cost as much as $75,000 a day) but look for more democratic and affordable access to Snapchat advertising in the near future.
Another feature of interest to small businesses are Branded Geofilters. One of the features that seamlessly integrates advertising content with user-created content is the option of branded photo and text overlays. Users are already familiar with Snapchat's free Community Geofilters, which are special overlays for photos and videos that Snapchat users can only access in certain locations. This unique visual component is intended for users to bring their own flair to the app, and allows them to share where they are or whether they are attending a special event.
With these new Branded Geofilters, however, contextually relevant brands can pay to offer users virtual stickers and frames that they can add to their own photos and videos.
The app's first geofilter deal was with McDonalds, which will offer a number of whimsical fast food-related overlays for users to experiment with. The geofilters allow brand mentions to become a natural and organic part of the videos and photos shared by users, rather than annoying and disruptive interruptions. Rather than having your brand push marketing messages, you're encouraging your audience to do the marketing on your behalf.
Advertising = the Future of Snapchat?
As the fastest growing social network of the last two years, investors are eager to get their hands on a piece of the Snapchat pie.
In response to the rapidly growing interest, Snapchat CEO Evan Spiegel has vowed to transform the network from a teen fad to a substantial enterprise. In an attempt to raise its standards to those of more established networks, the company has increased its security, eliminated third-party apps and released its first transparency report.
According to industry sources, the company has scaled back its pricing on day long campaigns--from $100 per 1,000 views to closer to $20, indicating that many advertisers are hesitant to gamble ad money on a medium they see as untested and unproven. This seems to be changing quickly, however, as investment dollars continue to roll in. As Snapchat keeps improving, it is also redefining its advertising model. As a marketer, expect this model to be in flux for the near term, until the market stabilizes. Of course, this means there may be arbitrage-like opportunities to purchase quality impressions at a cost-effective rate.
Looking for more on Snapchat and its importance to marketers? My firm, Firebrand Group has put together one of our “Orange Papers” focused on the topic. It covers Snapchat 101, Snapchat best practices, and case studies you can follow to better connect with Snapchat’s rapidly growing user base. You can access it here.