Social media star Kylie Jenner may be ‘sooo over’ Snapchat but the mobile network is expected to generate around £105m in UK revenues from advertising this year – almost double the amount of last year – and is being touted as “the one to watch”.
However, in its first ad revenue forecast for Snapchat, digital marketing intelligence group eMarketer said that despite the rapid growth in users and advertising activity, the company’s ad revenue will still only account for an 0.8% share of overall digital spend.
Google and Facebook dominate the landscape; this year, they will take more than 60% of all UK digital ad revenues, acccording to eMarketer, with Instagram and Twitter’s share of ad revenue just 4.9% and 1.2% respectively.
But Snapchat is being touted as one to watch. In 2015 it derived 95.9% of its global ad revenues from the US, but this year the proportion is set to fall to 75.8%, as its global expansion gains momentum. The UK will account for 10% of Snap’s worldwide revenues in 2018, eMarketer predicts.
MediaCom UK chief executive Josh Krichefski said: “It doesn’t surprise me that Snapchat is doing so well. The app now has a strong ad offering with a wide range of formats, measurement partners and a solid user base. Its redesign should also help to scale its offering as users get used to navigating round it. Snapchat’s followers, on the whole, are loyal; young users who engage with short-form, snackable content on-the-go and at home. The platform connects to this audience better than anyone and Snapchat knows this.
“We’re increasingly seeing advertisers and brands tapping into Snapchat’s fledgling advertising platform in a bid to claim a slice of the young consumer market.
“As it looks to overtake ad spend on Twitter, Snapchat is in a great position and the key will be to continuing innovating and evolving. The recent share price tumble it suffered when Kylie Jenner tweeted that she no longer used the app shows that Snapchat isn’t infallible. But based on what we’re seeing from clients and what Snapchat’s ad revenues are showing, the app has the potential to be a hugely important part of digital advertising for years to come.”
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