It seems that Snap Inc wants to add programmatic adverts to fill empty slots across videos on its Snapchat app.
According to multiple sources speaking to Digiday, Snapchat has been holding back a little when it comes to placing programmatic ads on shows. This has led to weakened revenue and a shift in focus for Snapchat.
Advertisers can currently purchase programmatic ads via Snap Ads, the company’s ad-serving platform. Programmatic video ads are currently available in the form of 10-second vertical units, which are placed in Snapchat shows, user stories, live stories and Discover channels.
The ad units can also be purchased through Snap partners including 4C, Kenshoo and Videology.
Until now, Snap had been selling video inventory directly to media outlets including Viacom and NBCUniversal. However, results were mixed with some shows ending up with zero commercials.
According to one source, Snap was finding it difficult to fill ad inventory due to a lack of experience of the content, but also lacking data to back up ad performance. It’s difficult to attract advertisers if you can’t prove your ads are working.
For example, a new E! show called “Face Forward” attracted total views of 50 million on Snapchat, however Snap failed to fill ad spots for the first seaon. For the second season, the show’s media partner will step up to fill those empty slots.
Although Snap declined to comment on the issue, it’s clear the company is struggling. If it can’t generate revenue for media content providers, then they won’t be enticed to produce shows for Snapchat. In addition, Snap loses out on potential ad revenue cuts.
We have previously reported on the high price tag for Snapchat ads and it seems video ads are no different. Although non-video formats have become cheaper across the apps due to its self-serve platform, video ads are not there yet.
One ad buyer told Digiday:
“It’s inevitable that they open up programmatic. The shows don’t have enough scale to begin with. Programmatic definitely makes Snapchat a buy that advertisers can just plug in for their existing campaigns.”