Snapchat opens up its APIs to all advertisers to boost ad revenue
Snapchat has opened up its application programme interfaces (APIs) to advertisers to try to boost ad revenue. Snapchat first offered self-serve advertising to brands such as Nissan four months ago but many advertisers have been deterred by the app's limitations. By letting third parties deliver ads for brands directly, the company is hoping to remove the uncertainty about pricing and options. But handing control to advertisers also presents some challenges, such as how Snapchat can prevent users being flooded with low-quality ads. However, Snapchat has enlisted Celtra, ReFUEL4, VidMob to help advertisers develop higher quality creative.

Brands no longer need to go directly through Snapchat to buy their ads in a move that opens the floodgates to a larger volume of advertisers that perhaps have been reluctant to spend with the app due to its limitations

Snap has been working toward this ever since it began offering self-serve advertising to more than 400 brands such as Nissan and Gatorade four months ago. Early results have been promising and by firing up its ad technology platform and allowing third-party partners to plug into the app and deliver ads for brands and agencies, Snapchat will be hoping to get more involved thanks to less mystery around pricing and options – both of which have been notoriously muddy ground until now.

To help cope with the expected surge in demand, Snapchat has added five partners that will buy programmatically from its platform including Videology, Kinetic and Adglow, bringing the total up to fourteen. The benefits to Snap are obvious. However, handing over control to the advertiser presents a number of challenges, namely the degree to which Snap can maintain high quality video advertising on the platform and avoid a situation where users are flooded with low quality ads.

“Despite this, I do remain optimistic,” said Liam Pook, partnerships and emerging media director at Essence. “If Snap manage to pull this off, it’ll be a great case study for how data-driven brand advertising - combining feed-based dynamic creative and sophisticated media targeting - can deliver effective campaigns for advertisers.”

Part of Snapchat’s attempt to ensure more ads doesn’t push people away to its rivals is sharper creative. Celtra, ReFUEL4, VidMob are now on hand to help advertisers produce better content such as long form video and webview attachments. While separate to the Creative Partners program, which launched last summer, they’re both working toward the same goal, with the Creative API partners offering tools that range from asset management, custom web experiences, A/B testing, creative analysis.

The chance of elevating creative on Snapchat was what stood out among those agency executives The Drum spoke to for the launch. The general consensus being that the combination of ad and creative partners highlights their desire to keep ads high quality amid the greater volume of branded content and the platform optimised.

“We are very excited to see Snapchat open up its network even more, as it becomes increasingly flexible and allows for better use of data and measurement,” said Lars Glenne, head of digital media strategy at DigitasLBi.

“Its efforts to become more competitive will enable us to include the platform in the mix, in a more integrated and precise way than before - especially when it comes to testing and learning with creative and audiences in a real-time environment. That said, we still believe Snapchat has some catching up to do with the other big social media players, but it’s definitely moving in the right direction. We like.”

One way to level the playing field could be behavioural targeting. Advertisers have been able to synchronise their email lists and files of device IDs with Snapchat’s own user data since September but now they can work with LiveRamp, PMG or mParticle to manage, segment, and update audiences for the app. It might not be as sexy as the creative features on offer but the prospect of better targeting is equally important to the app’s future revenue given social media strategies are far more focused on inviting people to view content rather than forcing them or incentivising them to do so.

With Facebook receiving heat following reports of fake news, questionable ad metrics and ad fraud, Snap’s decision to expand its Partners program is "welcome news to advertisers looking for alternative social platforms for their brand spend," added Pook.

It’s also worth mentioning, that Snapchat is still relatively new ground for many brands and so giving them the ability to test creative will help them understand what resonates with audiences. This year, Snapchat is expected to generate $935.5m in worldwide ad revenue, a jump of 155.1% over last year, according to eMarketer, while Facebook will generate $33.76 billion in total digital ad revenue, up 30.2% year-on-year.

​​"The ad APIs bring the platform [Snapchat] much more in line with the big hitters... we will hopefully see much more boldness and experimentation coming through, not just an increase in volume of advertising," said Hannah Chaston, social media director at Iris Worldwide.

“As the platform’s audience shifts beyond the stereotypical sexting teens, so the options for targeting by third-party data reflect the diversity on offer to marketers. This also matches the widening range of ad products in their arsenal from web view to owning live stories. Self-serve will also help more brands get involved thanks to less mystery around pricing and options, notoriously muddy ground until now.”

The decision to expand its advertising offer comes ahead of Snapchat’s much-anticipated IPO, which could be valued between $20bn and $25bn, making it the largest technology IPO since Facebook’s flotation in 2012. Consequently, Snapchat will no doubt be trying to show potential investors that it has a long-term monetisation model, and announcements like the introduction of the APIs will likely become more prevalent.