Snapchat's New Targeting Tools Could Help Improve Ad Results

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Snapchat is giving advertisers more ways to bid on ads through its API.
Snapchat is giving advertisers more ways to bid on ads through its API. Credit: Snapchat via YouTube

Snapchat is making upgrades to its ad technology so that advertisers can better target their messages, and perhaps increase the amount of time people spend with their ads.

The messaging app recently introduced what it calls "goal-based bidding," which gives advertisers more options when buying through its ad platform. This type of bidding lets advertisers set goals on their campaigns beyond just views on ads.

For instance, instead of simply paying for ad views, advertisers can bid on engagement with their ads when the desired outcome of the campaign is to have people swipe on the ads.

Snapchat confirmed the new ad bidding options.

Advertisers decide how much they value a swipe, and Snapchat automatically optimizes bidding and delivery to a subset of the advertiser's target audience that has a propensity to swipe, a Snapchat spokesman said in an e-mail.

This type of bidding may represent a minor upgrade to the platform, but it speaks to the app's growing ambitions with its ad technology. Snapchat is trying to give advertisers more control over campaigns inside the app, flexibility in buying ads, setting goals, and measuring the performance.

Snapchat launched this "goal-based bidding" earlier this month, and it's available to advertisers that buy through the still nascent ads API -- application programming interface.

Snapchat claims to use machine learning -- a type of artificial intelligence -- to target people who are most likely to swipe on a given ad. This targeting could help increase the amount of time people spend with Snap ads.

The average view time on Snapchat's video ads is fewer than 3 seconds, which has caused some concern among advertisers.

Snapchat said that 20% of advertisers are using "goal-based bidding," and that it has improved the efficiency of campaigns because better targeting means fewer wasted impressions.

Snapchat plans to offer more "goals" than just swipes, and could include app-installs and e-commerce sales.

Snapchat still needs to improve its ad platform if it truly wants to compete with Facebook, according to one social media agency executive, speaking on condition of anonymity.

"Snapchat is rolling out more action-based bidding, which is expected," the agency exec said. "But it needs to offer true business outcomes, and not just swipes."

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