Five key signs that Reddit is getting ready to launch its own search ads business

Reddit’s recent hire from a certain search engine

What better way to dive deep (and fast) into the world of search, than to hire someone directly from the number one search engine in the world? Reddit recently announced that it had hired Jyoti Vaidee as its vp of ad product. In Vaidee’s 11 years at Google, her responsibilities included overseeing product listing ads and dynamic shopping ads.

As Jeremy Goldman, senior director of marketing & commerce, and tech briefings at eMarketer noted, it’d be more expensive for Reddit not to invest in the right personnel right now, because the market is expecting them to grow at a certain rate. 

“By introducing a whole lot of innovation around the time they IPO’d, the market is expecting that to continue, and if it doesn’t, people notice,” he said. “So to continue that innovation, Reddit is doing that by bringing in new blood and firming up the team.”

High-intent user base

Reddit recognizes that the high intent of its users who search on its platform present a lucrative opportunity for advertisers.

CEO Steve Huffman, said as much during the platform’s Q2 2024 earnings call, by highlighting the potential to serve ads against search results, noting their explicit intention of users when searching.

“Increasingly, users are turning to Reddit for answers to their questions via search, recognizing the authenticity and trustworthiness of our content across a wide variety of topics,” Huffman said.

Marcel Hollerbach, chief innovation officer at ProductsUp agreed with this perspective. He believes Reddit is like a real community with a long history of providing quality content — and high quality content (which in Reddit’s case is produced by its users) is the key ingredient needed for a viable search business. “It’s like Google married with the old Facebook. On one side, you have this real community aspect, and on the other side the content is really searchable.”

Reddit is gaining momentum with contextual keyword targeting

Contextual keyword targeting enables advertisers to link specific keywords to their brand(s) or product(s) to boost visibility. And COO Jen Wong previously told Digiday, the team aspires to be the leader in contextual and interest-based advertising. And clearly what the team is doing, is working. Wong pointed out during the platform’s Q2 2024 earnings call that 50% of screen views are now on the conversation page. “The traffic is really going to that page, which is a great high intent, highly contextual page,” she said.

But how could contextual keyword targeting help advertisers take advantage of search behavior on Reddit? Simply because it ensures that their ads are both relevant and timely by matching user intent and interest at the time of search.

Hollerbach also noted that the possibilities for targeting that Meta had five or six years ago were substantially better then they are today due to the regulations that have since come into force. As a result, the tech giant has had to broaden its targeting. But Reddit’s contextual keyword targeting shields advertisers from those privacy issues. “With Reddit, advertisers are not targeting individuals, they are targeting the topics,” said Hollerbach. “So I think advertisers will be able to get to those people again.”

Shifting search behaviors

Nowadays, the way people shop has evolved, which in turn has shaped the landscape of product search and recommendations. Online shoppers, particularly Gen Z, favor personalized and trustworthy shopping experiences, over traditional online reviews — especially given the latter is considered more cluttered with ads and lacking in relevant content. Which is typically why more consumers turn to social media and influencers for product insights.

Goldman explained that the change in behavior is an opportunity for Reddit to get people used to searching on the Reddit platform instead of elsewhere. 

“People can be trained to go to Reddit first and start their queries there, whether it’s to find particular subreddits or an AI aggregate of what people are saying about a particular thing,” he said. “At that point, Reddit doesn’t need loyalty from people. It can expect that they’ll still be running searches on Google, or TikTok, or elsewhere, but Reddit will be in that mix.”

Strategic plans and CEO statements

Another clue is typically found in company vacancies. Currently, at the time of writing this article, there are two senior engineers and one senior product manager for shopping ads vacancies at the platform, among a number of other positions available. All three roles call out search (among other areas) as part of their required experience for candidates applying for the roles.

And let’s not forget that CEO Steve Huffman has been pretty open about Reddit’s intentions when it comes to search, when speaking to investors since the platform went public.

During Reddit’s Q1 2024 earnings call (its first, post IPO), Huffman very clearly stated that while there’s currently no ads on search result pages on Reddit, it’s a very high performing product elsewhere on the internet. “I think there’s no reason to believe that it wouldn’t be for Reddit as well, because the intention is so explicit when users are searching,” he said. 

Huffman added that once they’ve improved the product for the user experience and they have a good foundation, the team will start looking at monetization options. Speaking during Reddit’s Q2 2024 earnings call, the CEO reiterated the point that Reddit’s content is “uniquely valuable” and becoming more important in the context of internet search.

“Users run over 1 billion search queries a month on Reddit today, and our product work is improving the search experience and success rate on the platform,” Huffman said.

The CEO told investors that the plan is to begin testing new search result pages powered by AI later this year. Added to that, Huffman continued to talk about third-party search, referencing Reddit’s partnerships with Google and OpenAI.

“Our preference is for Reddit to be open and indexed in third-party search, and we are in discussions with both big and small search engines towards this end,” he added.