‘More ad dollars move to Snapchat’: Why direct-to-consumer brands eye the platform as they diversify from Facebook

The header image features an illustration with a dollar bill that has the Snapchat logo in the center.

Direct-to-consumer brands are increasing their spending on Snapchat this year as part of the ongoing push to diversify media budgets. Media buyers say spending on Snapchat has increased roughly 10% year-over-year with the platform accounting for anywhere between 10% to 25% of media budgets now. 

DTC advertisers are looking to make sure they aren’t reliant on a single platform, according to buyers who say that much of the interest has come from a need to diversify away from Facebook and Instagram as many brands have been too reliant on those channels in recent years. At the same time, brands are looking to get ahead of potential fallout caused by iOS 14 with Facebook and Instagram and understand their diversification options.

Given that Snapchat is more sophisticated than TikTok when it comes to targeting and direct response capabilities, advertisers are increasingly interested in spending more on Snapchat now. At the same time, Snapchat has done a better job of pitching DTC brands that they should be on the platform for its e-commerce capabilities, noted Duane Brown, founder and head of strategy at performance marketing agency Take Some Risk. 

“In the coming months, I think we will see more ad dollars move to Snapchat,” said Katya Constantine, CEO of performance marketing agency Digishop Girl, adding that the platform’s conversion-optimized campaign capabilities make it more attractive for advertisers. “We will see more brands launch on Snapchat.” 

As previously reported by Digiday, brands like Dr. Squatch have been increasing ad budgets on Snapchat as part of a diversification strategy. 

“As one of the fastest growing social channels, Snapchat Ads come up in conversations with our clients a lot,” said Zach Stuck, founder and CEO of Homestead Studio, an agency that works with DTC clients. “It’s an opportunity for brands to spend more and potentially at a greater return. Less competition and lower CPMs makes that possible. And Snapchat doesn’t come with the same pitfalls as Facebook either; our reps are super responsive and helpful.”

For Stuck’s clients, the percent of spending has increased quarter-over-quarter in the last year with the majority spending between 10-15% of their overall ad budget on Snapchat now. Last year, clients were spending between 0-10% of the budget on Snapchat.

While performance marketing agencies are seeing an overall increase in interest in Snapchat now, it’s more of a mixed bag for media agencies. For clients already spending on the platform, some are more interested as part of a desire to diversify or in the platform’s augmented reality capabilities.

“For a handful of clients it is something where they want to diversify as much as possible and I think with direct response capabilities and audience targeting sophistication, Snap is definitely second best to Facebook [and Instagram] right now,” said Stef Smith, head of paid social at Dentsu Media. “So there’s one case to be made there. The other is that Snap has been really bullish on AR and I would say we see some clients leaning into that more than others.”

That being said, even as brands are eyeing Snapchat now, buyers say it’s unlikely that spending on the platform will reach the level of Facebook. Still, performance agency buyers are bullish on the platform now.


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