Snapchat is one of the most popular social media platforms and marketplaces, with 414 million users logging in daily. It has also proven to be a powerful advertising platform, especially for reaching younger demographics.
Snapchat offers various creative ways to showcase ads to Snapchatters, helping create a bridge between the seller and the buyer.
However, while running ad campaigns, understanding their cost plays a crucial role in decision-making and planning expenditure. Many sellers wonder how much do Snapchat ads cost and how they can manage their ad budget. It’s important to note that advertising cost depends on how much you’re willing to invest to get the results you want.
To understand these concepts better, this guide will explain how Snapchat offers streamlined and flexible ad spending methods, which are suitable for all business types.
Let’s delve into the topic and understand how much it costs to advertise on Snapchat.
| 🗒️TL;DR – The platform recommends spending of $20 to $50 per day, with the minimum spending being $5. Snapchat follows the goal-based bidding strategy, wherein you spend based on particular actions (goals) only and spending based on those goals. With no pricing model as such, Snapchat lets you be in-charge of how you want to spend on your ad campaigns, creating a flexible structure, offering daily and lifetime budgets and buying ads (depending on the day) to secure a spot within the app. This creates a smooth experience for merchants selling on Snapchat. |
Table of Contents
Understanding Snapchat Advertising
Snapchat advertising is a way to market your products and services on the platform. It comprises different features that can be used to generate creative and captivating ad campaigns that quickly get the users’ attention.
These features include – Snap ads, Filters, Lenses, and Story ads and Snapchat feed. An advertiser must select the ad type based on the ad’s objective. These objectives include awareness, consideration, and conversion. So, for example, if your intent is brand awareness, then choose the ‘awareness’ objective and the ad type that will convey the message.
Snapchat ads also depend on the bidding strategy, metrics, audience type, etc.
To understand these factors better, let’s dive into the next section, which discusses the key factors of advertising on Snapchat.
Factors Influencing Advertising Costs on Snapchat
Before delving into understanding the cost and budgetary elements of Snapchat advertising, let’s understand the factors that influence these costs on the platform –
Ad Type
The cost of advertising on Snapchat can vary significantly based on the chosen ad format. Each type, from Lenses to Snap Ads, carries its pricing model, reflecting its potential reach and engagement level.
Single Image/Video Ads:
These Snap ads can be a single image or video ad that comes in between the stories and Spotlight. It is one of the ways to build brand awareness and retarget ads to customers who have seen or shown interest in your ads in the past.
AR Lenses:
It helps create user-generated content and generates engagement and conversions in an interactive way.
Filters:
Geo filters are snap overlays users add by swiping left or right, highlighting places such as neighborhoods, parks, restaurants, and shops.
Story Ads:
Create ad campaigns through Snap stories. Story Ads can appear between user Stories, in the Discover Feed, and Spotlight.
Collection Ads:
Enable easy product browsing and purchasing with four clickable tiles on Snapchat.
Dynamic Ads:
These ads auto-display products based on user actions, like cart abandonment, with personalized ads on mobile.
Target Audience
The specifics of your target audience, including age, location, and interests, play an important role in determining the cost. Some crucial points that affect the cost when targeting an audience are competition, size of the audience, language spoken, demographics, etc.
Bidding Method
Snapchat offers a variety of bidding strategies that influence how much you’ll spend on your ads. Your choice of bidding method can significantly impact the efficiency and cost-effectiveness of your campaigns.
There are three types of bidding that Snapchat provides –
- Max Bid: You set a cap on how much you’re willing to bid per impression, giving Snapchat a limit while it still works to maximize results.
- Auto-Bidding: Snapchat bids on your behalf, optimizing for your ad goals within your set daily budget.
- Target Cost: You specify the average cost per action you aim for, providing a rough guide for Snapchat to work within, even though it can’t predict ad clicks.
- Minimum ROAS: This strategy helps choose the best way to deliver a minimum ad spend while tracking new customers.
Another important bidding feature that Snapchat offers is goal-based bidding. It focuses on bidding on specific customer actions, such as purchasing a product or subscribing. This can be accessed in the ‘Delivery’ section when you select a goal (impressions) and bidding type (auto-bid).
You can select a bid from Ads Manager –
- On Ads Manager, select your ads account from the drop down.
- Click ‘Create ads’ and set an objective. Add your campaign details.
- Choose your bidding strategy.
You will be charged for each impression, no matter what bidding goal you choose.
Time of Year
During the holiday seasons, the cost of ads can change, especially during Black Friday, Cyber Monday, and Christmas. This surge in advertising expenses directly impacts the cost per click (CPC), potentially leading to higher expenses for businesses looking to promote their products or services.
Average Costs of Advertising on Snapchat
Snapchat has a flexible way of paying for your ads. It does not have a set pricing model, and the pricing is mostly dependent on goal-based bidding. As mentioned earlier, goal-based bidding focuses on specific customer actions like clicks, shares, and impressions.
Your overall expenditure depends upon different factors –
- Bid
- Bid Goal
- Performance
- Budget
Note that no matter what bid goal you choose, you’ll be charged per impression.
Keeping these in mind, let’s dive deeper into understanding how advertising costs work on Snapchat –
Flexible Spend On Ads:
Snapchat has set an affordable budgetary system wherein the minimum spend is as little as $5 per day. However, the platform recommends spending at least between $20 and $50. This is so that your ad can go through the Exploration Phase, a learning phase where your ad campaign is first launched. It lasts for 4 or more days, depending on your campaign objective.
In the Exploration Phase, when starting a new campaign or ad set, the systems at Snapchat go through a ‘learning phase’ that adjusts delivery based on bid, budget, audience, and past results. During this phase, your ‘Cost per Action’ (CPA) might temporarily exceed your bid as our machine learning fine-tunes delivery.
Over time, the system will adjust to fit your campaign details, leading to stable results. The faster your ads finish the Exploration Phase, the quicker Snapchat can optimize your ad performance.
Effective Cost Management For New Advertisers:
For people starting their advertising journey, Snapchat offers $75 free credit upon spending $50. This is a way to help new merchants kickstart their selling journey on Snapchat.
Also, it’s completely free to set up a Public Profile. This helps promote your business for free on Snapchat as a Public Profile, which can help build brand awareness and boost engagement, and users can start following your business’s profile for the latest updates.
Purchasing Directly From Snapchat
Snapchat offers another way to run ads without using the Ads Manager. It is by purchasing ads on Snapchat. According to strikesocial, Snap ads can be directly purchased for around $3,000/month in ad spend.
With sponsored lenses, the cost differs based on the day you choose to run ads –
- Sunday through Thursday, it’s $450,000.
- Friday and Thursday, it’s $500,000.
- During holidays and festivals, it can be $700,000.
Merchants are charged approximately $50,000 for Discover ads. Geo filters cost 1/5th of the Sponsored lens.
When you purchase directly from Snapchat, your ad gets a guaranteed spot anywhere in the app – Discover feed, Spotlight, Stories, etc. But if you create a campaign through the ad manager, your ads can appear in various places, like between users’ Stories or on the Discover page, depending on where your bid succeeds.
Delivery Optimization Window
This is for those who have opted for Pixel Purchase goal-based bidding. It helps businesses choose the way they want to display their ads based on the number of views and clicks tracked by the pixel. The optimization window helps Snapchat’s ad system to track certain customer events over a particular period of time and decide which ads to display to individuals. You get two options –
- 28-day click, 1-day view (28/1) optimization window
- 7-day click, 0-day view (7/0) optimization window
Choosing between these options depends on what kind of action you value more: quick buys or considering buys. If you care about both, the 28/1 might be best. If you only care about quick buys, then 7/0 might be the way to go.
Budgeting for Snapchat Ads
Snapchat allows advertisers to set either a daily or lifetime budget for their campaigns, providing flexibility in how ad spends are managed over time.
Daily Budget
The daily budget is the average amount you will allocate to an ad set daily. This budget is based on calendar days, meaning if your ad runs across two days, your spending could be split accordingly.
For example, if you have set your daily budget as $75 and have scheduled your ad to run from 2 PM today to 2 PM tomorrow, then this will be counted as two calendar days. This means you have $75 until midnight before tomorrow starts and an additional $75 until 2 PM tomorrow.
Lifetime Budget
A lifetime budget sets a cap on your total spending over the campaign’s duration, offering a broader perspective on budget allocation.
Under a lifetime budget, you can also use the dayparting feature. Normally, your ads on Snapchat can show up anytime, day or night. But, with the dayparting feature, you can pick exactly when you want your ads to appear, like only in the mornings or just on weekends.
You can decide to show your ads every hour or only at certain times you think are best. So instead of your ad popping up at any time, you can choose specific times that work better.
Remember, you can only use this feature if you’ve decided how much money you want to spend on your ads for their whole time running. Snapchat will then make sure your ad money is used wisely, showing your ads at the best times based on the budget you set.
Lifetime Spend Cap
A campaign lifetime spend cap sets a maximum amount your campaign can spend overall. You choose this limit when picking your campaign objective. So, for instance, let’s assume if your account cap is $10K but your campaign cap is $15K, spending will stop at $10K.
Here is the order of spend caps:
- An account-level cap
- A campaign-level cap
- Ad set-level cap.
To edit the lifetime spend cap, go to Ads Manager > Manage ads. Select your ad set/campaign and edit it by clicking on the pencil icon. Once the value is added, save the changes.
Tips For Optimizing Ad Budget
Optimizing your Snapchat ad budget is crucial for running a successful ad campaign. It involves several strategic considerations. Here are some of the best optimizing strategies that every merchant must follow –
- Snapchat recommends aligning your campaign objective with your goal-based bid type for better outcomes. For this, you must choose the correct ad objective. Select the one that perfectly matches the type of engagement you want.
- Ensure your target audience reflects your ideal customer persona. This way, you will find customers who will be interested in your brand.
- Utilize the Snap Pixel for enhanced tracking and conversions. Snap Pixel helps track accurate customer events and offers detailed analytics on your customers that can help improve your ad campaigns and plan better marketing strategies.
- Snapchat suggests some advanced techniques that you must incorporate –
- Incorporate different bidding strategies and heed the platform’s bid suggestions.
- Continuously learn about the ad auction mechanism to fine-tune your approach.
- Setting a realistic budget entails starting small and closely monitoring campaign results to make necessary adjustments.
Maximizing Your Snapchat Ad Spend
Now that you know how to manage your budget and plan your ad costs, it’s time to go the extra mile to achieve the best ROI from Snapchat ads. Here is how you can do it :
- Ad Metrics
When running ads on Snapchat, we focus on certain metrics to calculate the return on investment. These metrics include –
- eCPSU – It stands for “effective cost per swipe up.” It’s Snapchat’s term for the Cost-per-Click metric.
- Swipe Rate – It’s the average amount of time users swiped up to view your content.
- eCPV – It stands for “effective cost per visit” and tells you the average cost by video.
- Swipe Ups – The total time users spend on swiping up to view the content.
- Completions – Watch almost all ads, ensuring they are viewed until at least 97% completion.
- Impressions – Total views gained from users viewing your ads.
- Spend – Total money spent on running ad campaigns.
- eCPM – It stands for “effective cost per mille,” which means the average cost made per thousand views.
- Spend Cap – A spend cap is the selected budget of your ad account.
2. A/B Testing
Performing rigorous A/B testing can help decide which version of your ad will perform the best. This way, you can understand what will suit your audience and you can save up on spending extra bucks.
3. Leveraging Snapchat’s Analytics Tools
Always utilize Snapchat’s analytics tools for accurate data and retrieve in-depth performance analytics. This will help develop better ad strategies and improve your ad’s overall performance.
4. Making Data-driven Decisions
To refine and optimize campaigns, heavily rely on the data you receive from the analytics. It’s the best way to learn about customer activity and make informed decisions that can help boost conversions.
Bonus: Case Studies & Success Stories
Several businesses have harnessed the power of Snapchat to create impactful advertising campaigns. These success stories underscore the importance of strategic planning, budgeting, and execution in leveraging Snapchat’s dynamic platform for marketing success.
One such story is of the US-based brand UGG, which utilized Snapchat’s dynamic ads and raised 89% on its ROAS (return on ad spend). The brand ran two ads – one using the 28-1 optimization and the other with the 7-0 optimization delivery window.
By choosing both ways, the brand could run A/B tests that gave them a better insight into what type of delivery window was suitable for their business.
They tracked how their ads did up to 28 days after Snapchatters viewed them, but then they tried focusing more on how the ads did just within 7 days or even right after people saw them. This new way boosted their results by 81% for 7 days and 82% for just one day.
With the positive results, UGG opted for the 7-0 optimization delivery window for their maximum conversion campaigns, which helped shape better plans and boost revenue.
Conclusion
Understanding the nuances of advertising costs on Snapchat is crucial for effective campaign planning and budgeting. By choosing your goals, target audience, and the diverse ad formats available, you can craft a Snapchat advertising strategy that not only resonates with your audience but also maximizes your budget for the best possible outcomes.
So, what are you waiting for? It’s time to dive into the realm of Snapchat advertising and maximize your ROAS!
FAQs
Can I advertise for free on Snapchat?
Yes, you can advertise for free on Snapchat. It offers you the option of creating a free public profile where Snapchatters can learn about your brand, access Snapchat Shop, view your story ads, etc.
What is the minimum daily budget for Snapchat Ads?
Snapchat allows advertisers to start with a minimum daily budget of just $5. This makes Snapchat Ads accessible to businesses of all sizes, offering flexibility in how much you want to spend per day on advertising.
Are there different budgeting options available for Snapchat Ads?
Yes, Snapchat provides two budgeting options for advertisers: a daily budget and a lifetime budget. The daily budget is the amount you choose to spend each day on your campaign, while the lifetime budget is the total amount you’re willing to spend over the entire course of your ad campaign.
What is the recommended daily budget to optimize ad performance on Snapchat?
While the minimum daily budget starts at $5, Snapchat recommends setting a daily budget of at least $20 to $50. This helps your ad complete the “Exploration Phase” quicker, which is the period during which Snapchat’s system learns who in your target audience is most likely to engage with your ad. A higher daily budget can speed up this learning process, allowing Snapchat to optimize your ad’s performance sooner.
How does the cost of Sponsored Lenses on Snapchat vary?
The cost of Sponsored Lenses on Snapchat varies significantly depending on the day of the week. For ads running Sunday through Thursday, the cost is approximately $450,000 per day. On Fridays and Saturdays, the price increases to $500,000 per day. For holidays and special events, the cost can go up to $700,000 per day, highlighting the premium nature of these immersive ad experiences.
What are the starting costs for different types of Snapchat Ads?
The cost of Snapchat Ads can vary widely based on the ad format. Single image or video ads start at around $3,000 per month, while Snapchat Discover Ads, which offer a more premium placement, start at $50,000 daily.
How do Snapchat Ads costs compare on different days of the week?
Sponsored Lenses on Snapchat have different pricing tiers based on the day of the week, with the highest costs typically occurring on Fridays, Saturdays, and during major holidays or special events, reflecting the higher engagement levels and competition for user attention on these days.
