Get ready; unescapable ads are coming to Snapchat.
If you are used to consuming Snapchat videos without interruption, Snap Inc. is getting poised to spoil your fun. The company has been trialing ads that come on within your video, known as mid-roll, just like you will find on YouTube. However, unlike the popular video hosting site, you will have to sit through the ads because you won’t be able to skip any.
Span is reportedly testing the feature already with a select group of US-based content creators, and if all goes well, a broader roll-out will come in a matter of months.
While the app users may sigh at the news, it is a welcome move for creators, at least some of them. This is because Snap will share proceeds from the ads with the creators. The amount of money the creators get depends on a formula developed by Snap itself. It considers factors like how engagement and how often the creator posts videos. This means the amount paid to each creator will be different, just like YouTube.
Only creators with large followings or public figures, verified by Snapchat, known as Snap Stars, can be a part of this ad revenue sharing.
Snapchat has been trying to woo creators with the promise of money. The platform already put ads in-between Stories and the Discover section, but users could skip them and not even see a second of the videos. Also, this is the first time Snapchat is sharing revenue from adverts with its creators. With the ads coming up in between stories, it was impossible to determine who should get paid from the ad.
According to Snapchat, advertisers will benefit from the ads because placement in between Snapchat Stars’ Stories is a “high-value placement” for marketers, allowing them to connect with Gen Z.
The company is doing everything it can to prevent losing users to rival social networks, particularly TikTok. Part of its tactics has been lifting features from the fast-expanding TikTok video-sharing site.
The CEO, Evan Spiegel, had revealed that Snapchat users were posting less and viewing fewer stories. However, the company saw an uptick in the number of times users watched content on Spotlight, its clone of TikTok.
Snapchat also added more users in the last quarter, unlike Facebook, which saw a loss in daily active users (DAUs), with much of the loss happening in the valuable American market. Snapchat ended the year with 319 million DAUs.
Other money-sharing schemes that Snapchat has tried involve the Spotlight feature. Snap said in 2020 that it would pay out up to $1 million per day to creators uploading content to Spotlight. The company now claims it pays out millions of dollars per month. The company also unveiled Spotlight Challenges, through which it gives cash to creators to make the best videos using selected lenses, sounds, and topics.
Content creators can also earn money through Gifts, a feature that allows users to send them a tip, and Creator Marketplace, which pairs them and marketers for branded content.
Altogether, Snap paid out more than $250 million in 2021.
Industry watchers have commented on the disparity between social network revenues and the amount of money they give out to the creators on their platforms. For example, ByteDance, a company pulling in $58 billion, only has a paltry $200 million creators’ fund. However, YouTube has shared about $10 billion among its creators over the last three years, although the comparison is not so apt as the Google-owned platform hosts longer videos, making it less tiring for users to be served adverts.