Snapchat has a new Story to sell advertisers.
On Friday, Snapchat unveiled its latest ad format called Promoted Stories, which inserts a branded Story in the mobile app’s Stories tab among the organic Stories from the accounts a person follows, the original Shows that Snapchat licenses, the Our Stories it curates and the Publisher Stories that media companies produce for Snapchat.
The Promoted Stories format is something of a hybrid of Snapchat’s organic Stories and Snap Ads. As the name implies, it is a paid-for version of a regular Story, though there are limits on how many Snaps a Promoted Story can carry. Advertisers are required to include at least three Snaps, but no more than 10, in a Promoted Story. Like a regular Story, a Promoted Story will automatically transition from one Snap to the next. Each Snap included in a Promoted Story is effectively a Snap Ad. Brands can add attachments to each snap in a Promoted Story so that people can swipe up to visit a brand’s site, check out a branded article or install its mobile app.
Placement-wise, Promoted Stories will be given their own “Sponsored” section in the app’s Stories tab that will appear below the organic Stories posted by the friends, celebrities and others that a person follows on Snapchat. Like the Publisher Stories, Our Stories and Shows that are also included in the Stories tab, Promoted Stories will initially show up as a tile that people can tap to open; the tile and each Snap in a Promoted Story will be labeled “Ad.” Promoted Stories will only be displayed in the Stories tab, not the Discover tab, according to a Snapchat spokesperson.
“Our advertising partners have been asking for ways to tell deeper stories on mobile. Promoted Stories offer marketers access to the same Stories format used by our community, combined with the reach and placement enjoyed by publishers on the app,” Snapchat’s director of revenue product, Peter Sellis, said in an emailed statement.
Snapchat is selling Promoted Stories at an undisclosed flat rate as a single-day, countrywide takeover, making it the second such ad format introduced by the company in 2017. Earlier this year, Snapchat rolled out Snap Ads Max Reach, which offered brands a way to have their vertical video Snap Ads shown to all eligible users in a given country on a given day. Snapchat will tell advertisers how many times people saw their Promoted Story tile and how many times they opened the Promoted Story, as well as the total number of unique impressions, earned impressions, conversions and the effective cost of those impressions based on the ad’s performance and fixed price.
HBO is the first brand to run a Promoted Story in the US, while ASOS is the first to do so in the UK and France.
If Snapchat’s new Promoted Stories ad format sounds familiar, well, it should. The format is similar to the branded Discover channel that Sony Pictures Entertainment ran to promote its film, “Spectre,” in October 2015. It’s unclear why exactly Snapchat waited more than two years to graduate that test into an official ad format — albeit in the Stories tab, not Discover — though its parent company’s latest earnings report may paint a picture.
In the third quarter of 2017, Snap’s revenue failed to meet Wall Street analysts’ estimates. That shortcoming can be chalked up to the company’s shift to selling Snap Ads programmatically. By making the vertical video ad format more accessible, Snapchat commodified it, which dropped its overall average ad price and “made it harder to grow revenues at the rate we would have liked,” said Snap CEO Evan Spiegel during the company’s most recent earnings call. In terms of availability and pricing, Promoted Stories is effectively the opposite of Snap Ads. As a result, the new ad format could provide a counterweight to Snap Ads.
Perhaps more importantly, the new ad format gives Snapchat’s direct sales team something new to sell beyond Sponsored Lenses and Sponsored Filters, the latter of which recently spawned a variety available programmatically. At the very least, that novelty gives Snapchat’s sellers an excuse to call around to advertisers and their agencies. At most, it gives them a chance to win over brand advertisers looking for something splashy to combine with campaigns they may have planned for next year’s Super Bowl or Academy Awards or Winter Olympics or World Cup.
If successful with the latter end, then Promoted Stories also creates an opportunity to upsell advertisers. For example, since a brand would need to produce multiple Snaps for a Promoted Story, it could repurpose those Snaps as Snap Ads to run at a later date, and then it could use those Snap Ads to test out Snapchat’s conversion tracking or retargeting chops.
Snapchat could even wield Promoted Stories in its effort to win back the influencers that Spiegel acknowledged the app has ignored and now wants to embrace. Because brands have historically struggled to create custom Snaps, they may be willing to hire an influencer experienced in producing their own Stories; maybe Snapchat could help to strike those deals and even include a clause for the influencer to feature one or two of those branded Snaps in their own Story in addition to the brand’s Promoted Story.