Social mobile application Snapchat has announced the introduction of 10-second video ads which run between content on the Discover platform of the app. The company will charge advertisers $0.02 per view to generate revenue following its $15bn market valuation, it said at the Daily Mail/Elite Daily Digital Content NewFronts presentation on Thursday.
Snapchat Discover is the app’s own magazine platform
Discover was launched earlier this year, in collaboration with media providers Daily Mail, Vice, MTV, CNN, and Cosmopolitan. It functions like a digital magazine, offer news and magazine content. According to Snapchat, of its 100m users worldwide, they spend an average of nine minutes a day with the Daily Mail within Discover.
However, Snapchat’s Nick Bell has yet to clarify what constitutes a view – the full 10 seconds or shorter video ad running times. In addition, ad executives who have been pitched the new format, have expressed concern about the company not disclosing actual user numbers for Discover.
Noah Mallin, Head of Social, at media agency MEC, says:
“They talk about user numbers, but what’s tricky for Discover is that it doesn’t tell you the total number of users or how many people go to the Discover tab. They are still feeling their way as to what kind of ads they want on their platform.”
Malin may have a point. Snapchat recently moved away from its plans to sell branded stories as native ads. The company then quickly moved ahead to slash prices from $100 per 1,000 views to $20 per 1,000 views, hoping to attract more marketers and compete with the likes of Facebook and Google for digital ad revenue.
Jon Steinberg, North American CEO at Daily Mail, expressed enthusiasm for the new strategy, likening the product to Adwords:
“I think it’s transformative…one of the great advertising products. We are ready to sell that immediately. We are ready to produce the creative.”
It remains to be seen if Snapchat can attract advertisers and generate revenue to satisfy its shareholders.