When you think of “CRM,” Snapchat may not immediately come to mind, but the social media platform is making concerted efforts to change that perception through innovative developments.
In the last two years, Snapchat has dedicated substantial resources to enhance its advertising platform, focusing on critical upgrades to its performance marketing and direct-response capabilities.
In its recent quarterly earnings report, Snap disclosed that advancements in its direct-response advertising sector significantly contributed to an impressive $1.37 billion in overall revenue for the quarter, reflecting a robust 15% increase compared to the previous year.
This year, particularly, Snapchat’s product development team has significantly intensified efforts to enhance formats, optimization, targeting, and measurement within its range of lead generation tools. Kathleen Gambarelli, Snap’s group product marketing manager, emphasized these strides in an interview with AdExchanger.
According to Gambarelli, the core objective is to drive a higher return on investment (ROI) for advertisers, especially small and midsize businesses (SMBs). This focus allows these businesses to dedicate more energy to expanding their customer base while effectively achieving lower-funnel conversions.
Always be customizing
This summer, Snap rolled out enhancements to its lead generation ad format, introducing features that allow for a highly customizable intake form. These improvements include a date selection widget, multi-select options, autofill capabilities, and the flexibility to incorporate up to eight questions instead of the previous limit of three.
Companies that lack the resources to create their own capture forms can utilize Snap’s native version. However, advertisers also retain the option to direct users to their own websites while still leveraging Snapchat’s marketing pixel for tracking.
Enhancing functionality further, the new Snapchat form establishes integration with various CRM platforms due to a fresh partnership with Zapier, in addition to offering Google Sheets as an accessible, cost-effective option for smaller businesses. Previously, marketers found that lead reports needed manual downloading and separate input into each CRM platform, which often posed significant challenges for their strategies.
Thus far, Snapchat’s substantial investment in revamping its ad platform appears to have paid off considerably.
According to the latest earnings report, the total number of active advertisers on Snapchat has doubled over the past year, with direct response ad revenue witnessing a striking increase of 16% year-over-year (although Snap did not provide exact figures).
Gambarelli highlighted that since implementing the optimization updates, the cost per lead has dramatically decreased by 69%, while form submission rates have surged by 62% and click-through rates have risen by 21%.
An illustrative example includes a recent campaign run by the University of Idaho, which effectively targeted prospective students for undergraduate enrollment. Remarkably, this initiative generated 69% of all student conversions at a 22% lower cost per acquisition compared to alternative social media methods.
Protecting the leads
Beyond targeting student applications, marketers are increasingly employing Snapchat’s new ad platform for generating leads related to significant purchasing decisions. Notably, car manufacturers have leveraged these forms to facilitate the booking of test drives, while insurance agents have utilized them to connect with consumers seeking quotes.
However, there’s a less favorable side to lead generation. Earlier this year, lead generation ads on both Facebook and Snapchat surfaced as crucial evidence in a civil lawsuit pertaining to health insurance fraud, although it’s noteworthy that the plaintiffs reportedly directed individuals who clicked on the ads to their own intake forms.
Identifying fraudulent actors generally takes place “upstream” from the ad platform itself, starting with the initial setup of a business profile. Gambarelli explained that both automated systems and human moderation are employed to evaluate businesses and their ad campaigns thoroughly to ensure compliance with Snapchat’s advertising policies.
Additively, Snapchat has also integrated Apple’s App Tracking Transparency framework within its broader privacy strategy, empowering users with the choice to opt-out of data collection.
“Privacy has always been part of Snapchat’s DNA from the very beginning,” Gambarelli articulated, referring to the app’s origins as an ephemeral, auto-deleting messaging service. “And that’s informed how we have approached the building of all of our monetization solutions.”
**Interview with Kathleen Gambarelli, Group Product Marketing Manager at Snap Inc.**
**Editor:** Thank you for joining us today, Kathleen. Snapchat has recently made significant strides in its advertising capabilities, particularly with direct-response advertising. Can you share more about this shift and what it means for advertisers?
**Kathleen Gambarelli:** Absolutely! Over the last couple of years, we’ve focused on enhancing our performance marketing tools, especially for direct-response advertising. Our goal is to help advertisers, especially small and midsize businesses, achieve a better return on investment. By improving our tools, we want to empower these businesses to grow their customer base and enhance their conversion rates.
**Editor:** That’s impressive! I understand there have been updates to the lead generation ad format as well. What features can advertisers expect, and how will they benefit from these updates?
**Kathleen Gambarelli:** Yes, we rolled out several enhancements this summer to make our lead generation ad format much more customizable. Advertisers can now use features like a date selection widget, multi-select options, and up to eight questions on their intake forms—an increase from three previously. This flexibility allows advertisers to gather more relevant information from potential leads, and when paired with our CRM integrations via Zapier, it streamlines their data collection process tremendously.
**Editor:** Speaking of CRM integrations, how does this move facilitate smoother operations for businesses using Snapchat for their advertising?
**Kathleen Gambarelli:** The integration with Zapier is a key development for us. It allows advertisers to automate the lead capture process directly into their preferred CRM systems, thus eliminating the tedious manual downloading and uploading of lead reports. Smaller businesses can also utilize the Google Sheets integration, making it a cost-effective solution for tracking their leads.
**Editor:** It sounds like Snapchat is truly evolving as a platform for business advertising. You mentioned a significant drop in cost per lead and an increase in form submissions. Could you elaborate on these results and their implications for advertisers?
**Kathleen Gambarelli:** Yes, the results have been very encouraging. Since we implemented our optimization updates, the cost per lead has decreased by 69%. Additionally, form submission rates have increased by 62%, and click-through rates are up by 21%. This demonstrates that our enhancements are effectively driving engagement and conversions for advertisers, which is fantastic news for everyone leveraging our platform.
**Editor:** Thank you, Kathleen, for sharing these insights. It seems Snapchat is paving the way for innovative advertising solutions tailored to the needs of businesses today. We look forward to seeing more exciting developments from your team!
**Kathleen Gambarelli:** Thank you for having me! We’re excited about the future and are committed to providing more tools that help advertisers succeed.
