Major social media platforms, from Facebook to Snapchat, are looking at ways to attract business advertisers. While Facebook has been offering advertising solutions for years, Snapchat is new to the game. Both companies, however, have recently made announcements about new opportunities for businesses on their platform. Here’s what you need to know.
Retailers who have not adapted to the changing market are struggling as more companies go where consumers are: social media. In the first quarter of 2017, dollars spent on social media advertising have increased by 60% year-over-year. Instagram reached a million advertisers and experienced more advertising growth than any other platform with a 5,000% increase — Pinterest, Facebook, Snapchat, LinkedIn and Twitter had impressive year-over-year advertising growth as well. In turn, these platforms are working to develop new ways to help businesses reach their users.
Most recently, Facebook and Snapchat have been making headlines with their newest business innovations.
Facebook Rewards is designed to drive people into brick-and-mortar stores. Through the Facebook app on their phones, customers can get coupons or bonuses in participating stores. Facebook told TechCrunch they are conducting a small test group for Rewards feature — meaning it isn’t available to everyone yet. Using QR codes, customers can access store discounts and bonuses on in-store purchases. This idea takes the latest reward program craze and ties it directly to one of the most used social media platforms in the world. Stores can provide an excellent customer experience and increase foot-traffic while Facebook amplifies its potential for ad revenue and gains more consumer data.
Snap to Store
Snap Inc. is coming into the retail marketing game with their new Snap to Store program. Businesses can sponsor geofilter ads. When consumers are near a participating business, the specialized filter will appear in Snapchat users’ filter options. The company has been testing this feature over the last year with businesses, such as 7-Eleven and Wendy’s and they are looking to expand to more markets. The Wall Street Journal reported on the Wendy’s campaign promoting a new sandwich. According to Snap’s data, the campaign drove 42,000 visitors to the restaurant chain in one week. This number is derived by comparing the users who viewed the filtered image and went to the restaurant with those who hadn’t but still went. For example, if I went to Wendy’s and snapped a picture with their filter and sent it to all of my friends, Snap would have monitored the number of friends who viewed the picture and headed to the same restaurant, but that doesn’t tell the whole story. They then have to look at those users who went to the restaurant without seeing the image. The difference between those two numbers accounts for the impact of their marketing campaign. At the moment advertising on Snap isn’t as easy as it is on Facebook. It requires companies to tell a story in a different way and can be cost-prohibitive.
Of the two, Facebook is probably the safer bet for traditional retail businesses, but Snapchat’s ability to connect with a younger audience may change the way stores structure marketing campaigns to consumers under the age of 30. It is still too early to tell what sort of return on investment a Snapchat geofilter will offer, and while they collect data, Facebook is defining their position as a customer-to-store communication channel.