Snapchat and Advertising

1. Snapchat and
Advertising
Katherine Angst, Carla Caban, Brianna
Hanson, & Andrea Mosk

2. What is Snapchat?
- Mobile app that allows users to
capture videos and pictures that
self destruct after a few
seconds
- *with the exception of screen
captures*
- 3 Areas of Snapchat
- Live Story
- Local Story
- Discover
Source: http://www.forbes.com/sites/larrymagid/2013/05/01/what-is-snapchat-and-why-do-kids-love-it-and-parents-fear-it/
Figure 1. iMore. Snapchat Mobile Image

3. Who is Using Snapchat?
- More than 60% of U.S. 13 - 34 smartphone
users are Snapchatters
- Over 100+ million daily active Snapchatters
and growing
- 5+ Billion video views every day
Source: https://www.snapchat.com/ads
Figure 2. Snapchat Monthly U.S. Users. (Snapchat Ads)

4. The 3 Vs
Source: https://www.snapchat.com/ads
Evan Spiegel, co-founder & CEO of Snapchat

5. Snapchat Timeline
- Snapchat was first launched in July 2011
- Personal MyStory feature was released in
October 2013
- In June 2014 direct chat, filters, and event
stories were introduced
- October 2014 saw the first Snapchat Ads
- The Discover page was released in January
2014
Source: http://slicecommunications.com/the-evolution-of-snapchat/
Figure 3. Timeline of Snapchat. (Timeline)

6. Snapchat Features
- Filters
- Face filters “Lenses”
- Geotags
- Sponsored Filters
- Live Story
- Local Story
- Company/Celebrity accounts
- Ads on Live Story
- Discover page for brands
Figure 4. Buzzfeed QR Tweet, Screen Capture, December 15, 2015

7. Costs for Advertisers
- 2 cents per per view for 10 second ad
- Approximately $400,000 worth of ad space for
20 million views
- 4 ad spots per story
- Price changes depending on placement, more
expensive at the beginning
- Either choose to advertise within an event
or sponsor a Snapchat story which
prompts Snapchat to make a story
Source: http://recode.net/2015/06/17/snapchats-making-some-pretty-serious-money-from-live-stories/
Figure 5. Idea Money. (Image)

8. Costs for Snapchat
- Unlimited space
- Employee salaries
- Software developers ($137,416 a year)
- Content analysis ($29.67 an hour)
- Privately owned company
- BuzzFeed and People and other publishers
featured on the Discover page get the channel
space for free in exchange for their content, and
they share ad profits with Snapchat.
Source: https://www.glassdoor.com/Salary/Snapchat-Salaries-E671946.htm
Figure 6. Snapchat Money Logo. (Logo)

9. Costs for Users
● Snapchat is a FREE app
● $.99 for replays
● 30 lenses for $.99 each, only 7 free
Figure 7. Screenshot by Katherine Angst
11.22.15
Source: http://money.cnn.com/2015/11/13/technology/snapchat-lenses-rage/

10. Why Brands Advertise on Snapchat
Paid - Brands pay for live stories, filters, ads on stories and
discover pages
Owned - Engaging content and stories from the company’s
account
Earned - Users sharing what they do, snapchats pulled from user
generated content for live/local stories
Figure 8. Screenshot by Katherine
Angst 12.16.15

11. Drawbacks
Snapchat has limited reporting capabilities
- Can't tell how many men vs. women saw an ad
- No age breakouts
- Currently limited targeting
High cost per ad
Source: http://www.adweek.com/news/technology/snapchat-asks-brands-750000-advertise-and-wont-budge-162359
Figure 9. Screenshot by Katherine
Angst 11.27.15

12. Future of Snapchat
- $16 billion valuation (Wagner)
- Assuming a $1 billion ad revenue source
- Facebook and Google offered Snapchat $3 billion and $4 billion respectively (“Inside
Snapchat”)
- Applying for an IPO
- 8 rounds of equity funding (“Inside Snapchat”)
Souce: http://www.adweek.com/news/technology/4-big-developments-show-why-snapchat-was-2015s-buzziest-platform-168570

13. Questions?

14. References
Ads • Snapchat. (n.d.). Retrieved December 15, 2015, from https://www.snapchat.com/ads
Johnson, L. (2015, December 15). 4 Big Developments That Show Why Snapchat Was 2015's Buzziest Platform. Retrieved December 16, 2015, from http://www.
adweek.com/news/technology/4-big-developments-show-why-snapchat-was-2015s-buzziest-platform-168570
King, H. (2015, November 13). Why people are freaking out at Snapchat today. Retrieved December 17, 2015, from http://money.cnn.
com/2015/11/13/technology/snapchat-lenses-rage/
Magid, L. (n.d.). What Is Snapchat and Why Do Kids Love It and Parents Fear It? Retrieved December 13, 2015, from http://www.forbes.
com/sites/larrymagid/2013/05/01/what-is-snapchat-and-why-do-kids-love-it-and-parents-fear-it/
Miranda, C. (2015, February 9). The Evolution of Snapchat | Slice Communications - Philadelphia. Retrieved December 16, 2015, from http://slicecommunications.
com/the-evolution-of-snapchat/
Sloane, G. (2015, January 14). Snapchat Is Asking Brands for $750,000 to Advertise and Won't Budge. Retrieved December 13, 2015, from http://www.adweek.
com/news/technology/snapchat-asks-brands-750000-advertise-and-wont-budge-162359
Snapchat Salaries. (n.d.). Retrieved December 16, 2015, from https://www.glassdoor.com/Salary/Snapchat-Salaries-E671946.htm
Wagner, K. (2015, June 17). Snapchat Is Making Some Pretty Serious Money From Live Stories. Retrieved December 15, 2015, from http://recode.
net/2015/06/17/snapchats-making-some-pretty-serious-money-from-live-stories/