Snapchat Launches Ad Tech Platform 2.0 Inspired by Facebook's Model

By Published on .

Snapchat has more ad tech partners that can help brands create vertical video ads.
Snapchat has more ad tech partners that can help brands create vertical video ads. Credit: Snapchat via YouTube

Snapchat is launching its ad platform 2.0, and it's borrowing Facebook's strategy to catch up to its rival as quickly as possible.

On Tuesday, the messaging and media app was set to announce a new lineup of ad tech partners that could buy ads through its new automated system. Many of the partners, like Kenshoo, have been plucked from Facebook's marketing partner program.

Last year, Snapchat launched its ads API -- application programming interface -- but it was a rough first generation ad technology platform, and focused heavily on creative partnerships. Now, it will open the platform more widely, including allowing agencies and brands to license its API to do their own buying -- its first self-serve ad tool.

Marketers said Snapchat has been borrowing Facebook's early model of working with the industry to welcome ad tech partners to innovate and drive revenue on the platform. This puts Snapchat in the position of copying Facebook's ad roadmap while Facebook has been borrowing from Snapchat's product design.

"The only way to get a lot of ad buyers is to have all this tech," said one digital ad agency executive, speaking on condition of anonymity. "Snapchat is totally copying what Facebook did. They now have all the right tech partners to build the platform for them and bring in revenue."

Facebook leaned on outside tech companies and agencies to help build out its ad technology, but it has since consolidated its program, borrowing many of the innovations they helped develop. It's a game plan that Snapchat seems to be cribbing.

An ad's API allows third parties to plug into Snapchat and start offering their advertising clients the ability to buy there through automated pipes. The first partners included companies like 4C, Adaptly, Brand Networks and TubeMogul.

Now, the roster is expanding with Kenshoo, Kinetic Social, AdParlor, HyFn, Adglow and Videology.

Also, Resolution Media, owned by Omnicom, will be the first media holding company to license an API partner's software.

"What we will do is leverage Snapchat partners like 4C and take on the self-serve portion and manage that for clients," said Viji Davis, chief marketing officer at Resolution Media. "If you're talking about the evolution of Snapchat, it's really progressing similar to others before them in the marketplace. Only it's monetizing at a much more accelerated rate."

Buying through the ad tech platform lets the brands bid on ad inventory similar to how it's done on Facebook and Google. Ms. Davis said the auctions have reduced rates by 10% to 15 %. However, more competition with more buyers could drive up prices.

Snapchat is on track to hit $935 million in ad revenue in 2017, according to eMarketer. The company also is set to file for an initial public offering, catapulting it into the quarterly demands of Wall Street.

"Snap ads have been very successful and a lot of our advertisers have asked about them," said Will Martin-Gill, Kenshoo's chief strategy and development officer. Kenshoo has $6 billion of ad spend going through the platform annually, and now will open a direct line into Snapchat's inventory.

Snapchat also is launching a formal "audience match" program where partners can take advertisers' data like customer email lists and target users on the platform. Until now, Snapchat's match was only available directly through the company.

Merkle, Kochava, LiveRamp and others were named audience match partners.

Lastly, Snapchat introduced a "creative API" for companies like Percolate, Celtra, Spredfast and VidMob to help brands manage their video content. Snapchat has a unique video format with mobile vertical video that last up to 10 seconds, and marketers have had to start planning for that style to incorporate in their campaigns.

Companies like VidMob can help in the production and editing of those videos.

"It shows that they're very interested in improving marketers, brands and agencies' ability to create high-quality video content," said Craig Coblenz, VidMob's co-founder.

Most Popular