Snapchat is reportedly rolling out changes to its platform that will affect the ad experiences and collection of data of some users on the platform, according to various news releases. The news comes just before Snapchat’s Q1 2018 earnings on May 1.
Snapchat is reportedly rolling out changes to its platform that will affect the ad experiences and collection of data of some users on the platform, according to various news releases. The news comes just before Snapchat’s Q1 2018 earnings on May 1, as well as the looming General Data Protection Regulation (GDPR), which goes into effect on May 25. The social company likely hopes tweaking its data collection and ad strategy will strengthen its bottom line, as Snapchat remained unprofitable in Q4 2017.
Below is a closer look at each change, and why it could benefit Snapchat’s financial position:
- Snapchat will start testing nonskippable six-second ads in certain Shows to help address its ad-averse users, Digiday reports. These nonskippable ads, aptly called Commercials, will start being tested on May 15. Commercials won’t run in users’ Stories or in publishers’ magazine-like Discover editions. Currently, Snapchat’s young users often skip commercials in less than a second, according to Ad Age. Commercials could help remedy this issue and garner high viewability rates, as nonskippable ads are harder to turn away from, and help the social platform attract more ad clients.
- The company will also stop collecting certain data on European users under age 16 to comply with GDPR, according to the Financial Times. Snapchat plans to halt gathering certain data, like location history, on younger European teens, as GDPR bans companies from processing personal information of children under 16 without guardian consent. Rather than obtaining consent from guardians, Snapchat looks to minimize potential legal headaches by not processing any data that might require parental consent at all.
Meanwhile, Snapchat on Thursday released the second generation of its camera-equipped sunglasses, Spectacles, to boost its hardware revenue. The new Spectacles are slimmer and faster at offloading files to Snapchat than the first version. The new product is also waterproof, and allows users to capture photos, which the original Spectacles surprisingly didn’t let users do. These improvements were based on common complaints users had with Spectacles V1, according to The Verge, and this could make the new iteration more appealing to Snapchat’s more heavy users. An appealing Spectacles product would help Snapchat redeem the flop that Spectacles V1 turned out to be, and diversify the company's revenue, almost all of which is currently generated from advertising.
Leading the pivot to video are the major social platforms — Facebook, Instagram, and Snapchat — as well as YouTube, the early pioneer in digital video.
These platforms are increasingly prioritizing video on their properties, and also moving to secure high-quality original programming that mimics TV. Meanwhile, publishers and other media companies, brands, and advertisers are all swept up in the tide and are reorganizing their operations to focus on video.
The ultimate goal of these digital video companies is to create a market that can complement (or rival) and eventually surpass that of traditional TV. Although these leading social platforms are all-in on video, they each approach the space differently. Facebook's game plan differs from Snap's, which differs from YouTube's. Understanding these nuances is important for industry participants.
- Assesses the evolving social video landscape, with attention to Facebook, YouTube, Snap, and Instagram.
- Analyzes the relative strengths of each platform from a product, distribution, audience, and monetization perspective.
- Looks at what’s next for the industry, so that media creators and brands can invest for the future.
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