Opinion

Snapchat Ads launch in Asia – is it too late?

As the social media app adored by teenagers launches its ad platform in Asia, Carat's Jonathan Rudd questions its continuing value to marketers and their audiences

As you’ve probably heard, stock of Snap Inc took a pounding last week as it announced its first quarterly results since going public. If you want to know all the details, it’s all over the internet or you can read a comprehensive review here.

So why are they finally launching ads in Asia now?

Well, the simple reason is that Wall Street is piling on the pressure and the shares tanking. They need to increase both its user base and its revenue per user.

On the first point, clearly Snap can only monetise people who are actually on the platform, so launching ads in other markets won’t help grow its user base. However it will help with the second point. Right now global revenue per user stands at a paltry US$0.90 globally compared to Facebook at US$4.23. One clear way to increase that is to start putting ads in markets where they currently do not and revenue per user is zero, such as all of Asia.

What is good about advertising on Snapchat?

Assuming that platform fits into the overall connections and communications strategy, there are three key considerations when planning channels of distribution.

Content: Snap has created a unique content experience for its users that is vertical, mobile and has a distinctive creative treatment that sets it apart. This means brands can’t just stick a television ad on Snapchat (YouTube and Facebook moan about this but still take the ad dollars). If the content is made correctly, it gives you a fully viewable vertical video and massive generated content opportunities through sponsored lenses and sponsored geofilters which have proved a huge hit in other markets.

Context: Snap ads and the Discover section in particular offer great context. It is quite literally the glossy interest magazine for the digital age, offering a carefully curated collection of publishers that reflect the various interests of young people, such as fashion, food, tech, sport that are slightly modified for each market. No fake news; no ads being top and tailed with baby photos or unsavoury live videos. Sponsored geofilters also offer supreme context in terms of location

There is also now the opportunity to target demographics by leveraging third party audience segments through their partnership with the Oracle Data Cloud (in US only for now). This helps for those brands still hung up on demographic targeting, but also provides more meaningful inputs such as past buying behaviour.

Quality: Snap came under criticism when it first launched its ad products for the lack of metrics and verification. However the last year or so has seen them partner with a host of  measurement partners. Everybody is aware of the reporting problems at Facebook last year but less so of the challenges Facebook and all feed based ads are having with meeting viewability standards. Snap ads occupy the full screen with sound on and in the case of sponsored lenses and sponsored geofilter, are fully opt in. Word from other markets is they score very well on key viewability metrics.

Brands are increasingly seeing the key indicators of advertising quality being linking to sales and data collection. With the soon to be launched ‘Snap to Store‘ feature, brands will soon be able to track footfall attribution of not only people who use a geofilter but of friends who saw someone else use a geofilter in the past week.

But will marketers in Asia actually care?

Now that Facebook are focused on wiping Snapchat off the face of the earth through copying their AR camera first strategy and have rolled out a stories like product across all their platforms (while Instagram stories already surpasses Snapchat globally) it would be easy to dismiss Snapchat in Asia.

In addition, marketers in Asia do not really appreciate just how ingrained Snapchat is in the daily lives of millennials in the United States, with the average user spending 25-30 minutes per day on the platform. This shows the potential it could have with wider adoption.

However to succeed in Asian markets, it needs to offer users a utility that other platforms cannot. This could mean local publishers on Discover, more local and culturally relevant geofilters and lenses. Moreover, it also needs to get local influencers spreading the word that with Snapchat, they are in their ‘circle.’

My main concern for Snapchat here is that when Instagram Stories launched in the US, Snap was already the go-to platform for live ephemeral moments and had scale with millennials; that wasn’t the case in Asia.

Hard facts are scarce but despite Snapchat now figuring on many markets in Asia’s Global Web Index reports, Asia hasn’t really warmed to Snapchat. Anecdotally, I’m seeing and hearing that people are using the platform less or totally giving it up in favour of Instagram Stories.

This is happening at a greater pace here in Singapore. While the country is a developed market with the high connection speeds needed to run Snapchat, Singapore is a market where big brands don’t heavily invest. To me, there is neither the budgets nor the audience to be found here.

Snapchat isn’t going to offer the reach of other platforms. It is going to require investment in made-for-platform creative. However if you’re a brand with global content to repurpose, or you have a physical point of distribution or event you want to generate talkability and potentially footfall for, it could be worth trying out.

The greater short-term opportunity in Asia will be in Indonesia and Philippines, where despite the comparatively poor data networks, Snapchat remains popular with a wealthy, young and in-the-know core audience, who spend three and four hours on social media a day.

So if you have Snapchat and live in Singapore, it’s worth keeping your eyes peeled to see which brands took the bait.

Jonathan Rudd is the regional head of digital strategy at Carat and this article was originally published on his blog – follow him on Twitter @jrudd_digital

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