Why Snapchat Advertising Just Got More Attractive for E-Commerce Stores

November 28, 2018

o say Snapchat has had a rough year would be putting it mildly. The multimedia messaging app has seen sharp declines in their ad revenue, stock price and daily active users — not to mention increased competition from the likes of Instagram.

In the U.S., Snapchat makes up just 0.6 percent of the digital ad market, and 0.9 percent of the mobile ad market. However, the company is trying to change its course with the recent announcement of several advertising-friendly features.

Let’s discuss why Snapchat advertising just got more attractive for e-commerce stores.

Collection Ads

Leading Snapchat’s new initiatives is the introduction of Collection Ads, an expansion of the self-serve shoppable ads format that Snapchat’s been testing with select retailers since June. Collection ads allow e-commerce brands to showcase a curated group of products that Snap users can tap for more information. Initial testing found the ad format to be a big success for e-commerce brands like eBay and Wish, with each seeing five and 17 times higher engagement rates, respectively.

Product Catalogs

Perhaps the most exciting development of Snapchat’s announcements is product catalogs. Snapchat changed their advertising model to programmatic earlier this year to attract a broader advertiser base and offer more affordable, flexible ad campaigns. The launch of product catalogs complements the platform’s programmatic nature, giving advertisers the ability to post their entire product catalogs to create thousands of different ad formats to display in Story ads, Snap ads and Collection Ads. Through the use of product catalogs, it’s easy to imagine how much easier it’ll be for advertisers to deliver tailored on-the-fly creatives, whether they’re selling beauty products from home, high-end electronic gadgets or fashionable threads.

Advanced Targeting

A major thorn still affecting the programmatic advertising industry is the lack of clarity regarding legitimate user impressions. Snap is rolling out more advanced audience targeting through the use of tiny downloaded graphics files. With Snap’s pixels, advertisers can track more granular audiences, such as the specific actions users take when browsing particular areas of their site.

Amazon Visual-Search Feature

No company has more significant effect on the online landscape than the mighty Amazon, which is why Snapchat launched a visual search feature that integrates with the online marketplace. If you thought keyword-based shopping was difficult, then you’ll love this feature. Users can point to any physical product or barcode using SnapChat’s camera and press hold to capture the item and see its Amazon listing.

These changes come after announcements of ‘Curated Our Stories’ — which give select publishers like Viacom, CNN, Refinery29 and others access to user content to include them in live events, breaking news and other content offerings.

As valuable as these changes appear to be to Snapchat’s bottom line, many advertisers will surely be looking for guidance. But the social media platform addressed that as well, adding 30 company-certified partner agencies to help brands navigate the new advertising features and accomplish their campaign goals.

These advertising changes undoubtedly make Snapchat a more attractive advertising option for e-commerce stores and bolster Snap’s long-term profit-earning potential. However, the platform is still mostly used by people under age 25. The real determinant of Snap’s long-term success will hinge on whether they can win back their lost users and engage older Millennials who are so crucial to the company’s bottom line growth.

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