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Snapchat Discover Video Ad Model Resembles TV

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Megan Quinn says if a media company has no Snapchat strategy, it's late.

The Discover feature’s 11 channels, including those from CNN, ESPN, the Food Network, National GeographicPeople, and Vice, alongside Comedy Central, produce their own videos and their own print stories.

They also sell their own ads, giving Snapchat an undisclosed cut of the revenue. The collection of companies looks a lot like a basic cable package, except that it carries mostly short video clips. (Viewers can opt to watch full segments or shows.) Snapchat’s youthful audience helps the companies running Discover channels charge advertisers about $100 per 1,000 views, about twice the ad rates of YouTube and Hulu, say three people familiar with the app’s viewer data, who weren’t authorized to discuss the issue.

Snapchat s Discover Feature Video Ad Model Resembles TV Bloomberg Business

Snapchat now offers video feeds from major media companies.

According to Cowen, an investment research firm, 71 percent of Americans aged 18 to 29 use Snapchat, which has a modest audience outside the U.S. The app “got inserted into the conversation faster than anyone expected,” says Comedy Central’s Grimes, ranking its importance on the same level as Facebook, Twitter, and Instagram. “You have to have offerings for each of those platforms for the shows you do now.” In March, Alibaba invested in Snapchat at a valuation of $15 billion.

When you log in to Snapchat, two swipes to the right will bring up the main Discover screen, populated with media logos. Tap the one for Comedy Central, and you’ll get a 10-second clip from an episode of South Park or Key & Peele, played on a loop. Swipe right for another clip from the same channel, then another, then sit through an ad to get to the next, or swipe down for a longer related segment or episode. Channels for People or Cosmopolitan include animated story packages but are designed more to encourage a swipe down into a print story. “It’s a really great opportunity for us to tap into a millennial audience,” says Joe LaFalce, head of digital business development at People, adding that he’s recently assigned four staffers to tailor stories for Snapchat, in part by putting a greater emphasis on younger stars. Producers for Comedy Central’s popular late-night shows now stick around on nights after their shows wrap to select and format clips for the app.

Snapchat is also selling ads against feeds of short, nondisappearing videos from users, a feature called “Live” unveiled last summer. Some Live feeds have drawn more than 30 million viewers, say the three people familiar with Snapchat’s viewership—about the same number of viewers that tuned in to the opening ceremony of last year’s Winter Olympics. Even so, the clips from cable networks have proven more popular with major advertisers, from Samsung to General Electric. McDonald’s bought out Comedy Central’s Snapchat ad inventory when the channel launched in January; BMW did the same for CNN’s.

Snapchat skews young:

Snapchat skews young chart Discover Feature Video Ad Model Resembles TV Bloomberg Business

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