Snapchat mobile advertising revenue set to increase 155% next year

Anne Freier

In Mobile Advertising. September 8, 2016

Snapchat could be set for some rapid growth over the next year, according to a report from eMarketer. Estimates from the analysis firm suggest that the social app will make $399.69m in global ad revenue in 2016, jumping to $935.46m in 2017. Advertisers are particularly drawn to Snapchat’s ability to reach Millennials and younger audiences.
Snapchat global advertising revenue
Snapchat has been busy continuously expanding its advertising portfolio and wasn’t shy to try some new and more engaging formats.
It’s Discover feature is currently generating the biggest share of the firm’s revenue at 43%. However, that’s likely to shift to Stories in 2017 as the main ad revenue source. Stories is predicted to generate 37.8% of Snapchat’s advertising business.
However, Snapchat still has some way to go in terms of social network advertising dollars. The company may be reaching 31.6% of the US social users, but only captures 2.3% of the ad market as it competes against heavyweights Facebook and Twitter.
Cathy Boyle, Analyst, eMarketer, explains:

“Snapchat has improved its targeting capabilities and partnered with 11 measurement firms to address the concerns voiced early on. What it has yet to prove is whether it can consistently deliver a better return on investment for advertisers than other social networks.”

Right now, 95% of its ad revenues are coming from the US. eMarketer predicts that monetisation across other countries where it has substantial user bases such as the UK will grow. By 2018, a quarter of Snapchat’s ad revenues are predicted to come from outside of the US.
Snapchat US ad revenue share to spread globally