Demand for Snapchat programmatic adverts continues to grow

Anne Freier

In Mobile Advertising. August 9, 2018

Snap Inc. this week reported earnings which exceeded expectations, but revelations that its user numbers declined 1.5% during Q2 2018 sent its stock spiralling.

However, eMarketer’s VP of forecasting Martín Utreras was quick to point out that the company’s programmatic efforts were actually paying off for the first time.

Indeed, Snap’s Q2 revenues increased despite a drop in user numbers and lower advertising prices signalling stronger demand from advertisers.

Q2 revenues rose 44% the year over and average revenue per user jumped 34%.

Aaron Goldman, CMO at 4C Insights added:

“Brands are increasingly investing in Snap as a critical part of their advertising campaigns, signalling that they continue to see performance from the platform. 4C saw a 45% year-over-year increase in Snap Ads spend in Q2, mirrored by Snap’s own report of 44% revenue growth from a year ago. Snap continues to innovate to attract both users and advertisers alike, with new products like Snap Kits, Spectacles, and Shoppable AR lenses. These innovations allow advertisers to leverage the features that consumers connect with most, pointing towards a promising future for Snap.”

Meanwhile, eMarketer estimates that Snapchat’s reach among teenagers is now nearing 95% of social media users. Moreover, many of its users actually favour the app compared to platforms such as Instagram, Twitter or Facebook according to a Piper Jaffray survey.

The drop in user numbers is being attributed to the app’s redesign earlier this year. At the same time, Snap has been working hard to build content and influencer partnerships to boost alternative marketing strategies. More recently, it also launched a private marketplace for Discover partners to monetise their content.

It remains to be seen if these efforts can help Snap turn things around until the end of the year.