The company’s tracking pixel has also gained steam, which accelerates the advertising platform. Snapchat’s pixel tracked 230 million purchase events in Q3 after seeing only 70 million the quarter before, which leads to better lookalike audiences, measurement and CPMs.
Onboarding new advertisers and improving the ad platform performance will increase revenue for Snapchat even if users tail off. But to be sustainable long-term, the company needs user growth to return.
Snapchat has a two-pronged strategy to return to user growth, Spiegel said.
In the US and Europe, Snapchat has a “marketing and communications challenge” to grow out of its core user base of 13- to 34-year-olds, he said. In other global markets, it faces a technical challenge to decrease app bandwidth, since people won’t download the app if its heavy visuals and AR features eat up their data plan.
Broadcasters, streaming services and digital media companies have tried to figure out how mobile viewership can achieve better quality, Spiegel said. “But we’re finding out what really resonates.”
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