How do you market effectively with Snapchat

How does SnapChat make money?

At first glance, the idea of ​​messages that self-destruct after a certain period sounds terrible.

This is exactly what Evan Spiegel's classmates thought when he came up with the idea behind SnapChat in 2011.

Fast forward to 2017 - Snap (Snap Inc.), the parent company of Snapchat, listed its IPO at $ 17 a share on March 1st, 2017 and the company is scheduled to begin trading on the New York Stock Exchange on March 2nd, 2017. This will give Snap a market value of nearly $ 24 billion, making it the largest US tech IPO since Facebook.

This begs for our next question ... which is the main topic of our article ...

How does SnapChat make money?

Fast answers -

  1. Snapshots
  2. Geofilter
  3. Sponsored Lens Filters
  4. Show
  5. Sports partnerships

Before we dive in, we must first understand ...

What is SnapChat Really?

To understand SnapChat's success, you first need to know what the app does and how it works.

Users can exchange "snapshots" or messages, which can include text, videos, and photos. Private messages are automatically deleted after opening. A public post, on the other hand, has a 24-hour expiration date.

If you think these limitations are ridiculous, know that videos can only work for ten seconds. In other words, SnapChat is either a poorly designed messaging app or something else Completely. But with 150 million daily active users and an estimated valuation of $ 18 billion, it's clear that this social media craze is anything but poorly thought out.

Expiration Dates - SnapChat's Selling Point

The brilliance behind SnapChat boils down to a simple philosophy - Some things are more valuable with a time limit.

Assigning expiration dates to social content increases the engagement factor. This is mainly because having the ability to capture snaggings while available gives users the feeling of exclusivity. For example, stories that cover major sporting events achieve a high level of engagement because sports fans love the "in the moment" feeling. For a PR boost, companies also provide stories that take their audience behind the scenes. Some suitable settings include the launch of a new office, company outing, or charity program.

Of course, SnapChat includes other exciting features as well. Aside from being able to send snapshots, users can also post stories, which are curated snapshots that are visible to followers.

To make snapshots more interesting, SnapChat also offers lenses that add humorous overlays - from frowning faces to the infamous dog filter. These filters sometimes require action on the part of the user to trigger animation, such as raising an eyebrow and sticking out the tongue. Overall, lenses provide users with a breeding ground for creativity and self-expression that everyone can appreciate.

Finally, it turns out that SnapChat's self-destructing messages are great for complete privacy and security. In some ways, if you are concerned about privacy, sending snaps is way better than using encrypted messaging apps. Once a snap has timed out, no unauthorized person can restore its contents.

For all of these reasons, SnapChat is proving to be a very effective content distribution channel for brands looking to establish themselves on social media. It's time for the million dollar question ...

How does SnapChat make money?

Just like other social media platforms like Twitter, Facebook, and Instagram, SnapChat also benefits from this Advertising. But thanks to its unique properties, the company kills.

1 - Snap Ads

Snap Ads are the be-all and end-all of SnapChat advertising. You work with 10-second full screen video ads that are always relevant to other snapshots. These ads are also interactive. When presented, users have the option to swipe up to access more content - be it a lengthy video, blog post, or app installation.

To improve conversions, the company launched SnapChat partners with companies like 4C, SocialCode, TubeMogul, and Adaptly. Data suggests SnapChat's sales will hit close to $ 1 billion in the next year. According to eMarketer, one of the reasons for this explosive growth is the app's immense popularity - especially among millennials and Gen Z members.

Despite SnapChat's efforts to increase ad revenue, there's one line they wouldn't cross: ruin the privacy of their users. Because of this, the company ensures that companies cannot advertise their users' private messages.

Aside from Snap Ads, SnapChat uses the following advertising revenue:

2 geofilter

Life is more fun when you live in the moment

These are the words you can find in SnapChat's description on the mobile app store. It's about capturing the moment and sharing your experience with your followers.

With geofilters, Users no longer have to manually provide details. Whether in a mall, a national event or a famous landmark, SnapChat has exclusive filters that give context to each Snap. You no longer have to explain where they are, what they do, and why they are there. Hence, they are encouraged to quickly create user-generated content and share it with their social circles.

How does SnapChat benefit from this feature? Note that the company does not charge for the design on geofilters. If you want to use an on-demand geofilter, you need to create it yourself. However, SnapChat will charge you for two things: the size of the area and the time the geofilter is available.

To start off, SnapChat charges $ 5 for 20,000 square feet of coverage, which is the minimum area required for a geofilter. This area is usually enough for a medium-sized office. On the other hand, the maximum purchase area for a geofilter is 5 million square feet, which should be enough to cover a couple of city blocks.

Geofilters can remain in operation from an hour up to a total of 30 days. In addition to large companies, individuals can also pay for temporary geofilters at events such as birthdays and weddings.

Here are some tools and services you can explore: is the easiest way to create SnapChat geofilter. It is also a tool for you to make a beautiful geofilter. Here's the message from Danny, a Geo-Filter representative:

Our Geo-Filter Designer makes it easy to create an impressive geofilter that can be sent to Snapchat instantly. Geo filters are great for marketing collateral, weddings, birthdays, small businesses, and more.

If you're not good at designing there is always something you can do to get someone to do it. CustomFilterz can be your solution. It offers a highly customized geofilter for users. Jason Slater, the co-founder of CustomFilterz, has a message to share,

For companies that want a fully customized geofilter that users can share and combine with their branding, CustomFilterz is the # 1 rated geofilter design agency. We also create geofilters for birthday parties, weddings, etc. "

Alternatively, you can search for professional SnapChat filters on an online marketplace. FilterPop is the marketplace for custom SnapChat filters. Here you can find geofilter designs for weddings, birthdays, and more. Alex Kehr, the CEO of FilterPop, shares his corporate mission:

We want every event and moment to be as memorable as possible. The FilterPop marketplace connects the best designers in the world with the most innovative companies and consumers. We help people create memories that will last a lifetime.

3 - Sponsored Lens Filter

To realize the appeal of lens filters to SnapChat users, large companies have introduced their sponsored lens filters. These lens filters are similar to geofilters in that they can only appear in certain locations. However, lens filters are more interactive and dynamic than stationary geofilters. To increase the user's immersion, the lens filters also play a sound clip when active.

For example, Essen at KFC also enables the Colonel Sanders lens filter, which turns the user into a white-maned colonel. A special animation with a fried chicken leg also takes place - the user is prompted to take a bite.

Note that geofilters and sponsored lens filters do more than just improve the customer experience.

Think about it - if you're eating at Taco Bell and your head suddenly turns into a giant taco bowl, share it with your friends first. As a result, brands that advertise on SnapChat can leverage User Generated Content (UGP) as well as their customers' social media reach to gain awareness.

Taco Bell's noble attempt to turn people's heads into tacos has paid off, by the way.

In total, 224 million people have interacted with the Taco Head SnapChat filter. To be fair, brands trying to advertise with sponsored filters had to hand out as much as $ 750,000. By comparison, the average cost of a 30-second ad on Super Bowl costs a whopping $ 5 million. This is not a guarantee that the audience will be even paying attention during the commercial.

4- Discover

If you're using SnapChat, you might find that swipe right twice to open the Discover feed. Find curated snapshots from publishers like CNN, BuzzFeed, People, and Cosmopolitan here. There will also be a few commercials between snaps, so it's clear that Discover is being monetized.

While no one knows how much SnapChat the Discover feature is doing, they should put money into action, given that 20 big name publishers have partnered with the company. This feature has also expanded during the time SnapChat saw significant revenue growth.

Chances are, both SnapChat and a publisher share ad revenue. It's just not clear how much each party gets for each deal.

5- Sports partnerships

In the past few years, SnapChat has partnered with sports organizations such as the NHL, the NFL, and the MLB. These organizations allegedly use live stories at sporting events to reach more people in the social space.

As with Discover, it's not clear how much money SnapChat is making from sports partnerships. However, since the app offers a direct connection to the young and passionate audience, the big leagues are investing in deals that offer weekly Discover channels such as "MLB Wednesdays".

Note that the MLB started using SnapChat back in 2014. At this point, users will need to follow their account to view the stories they have published. But with a partnership, live stories are passed on to all users.

In a previous report by, Live Story ads make SnapChat anywhere between $ 400,000 and $ 500,000 to reach the company's entire user base. In addition to large sports organizations, live story ad partnerships are in demand with companies such as iHeartRadio and AEG.

Final words

In the past, people were confused about why SnapChat was worth so much because its revenue model wasn't clear. That explains the company's moves that have influenced monetization over the past few years.

Today SnapChat has a solid revenue model that caters to both businesses and individuals looking to seize the "moment". For tips on integrating SnapChat into your social media marketing strategy, check out these ground rules for effective Snap chat marketing.

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About Christopher Jan Benitez

Christopher Jan Benitez is a professional freelance writer who provides small businesses with content that engages audiences and increases conversion. If you are looking for high quality articles on everything digital marketing related then this is your type! Feel free to say hello on Facebook, Google+, and Twitter.