Snapchat probably isn’t the first thing you think of when you hear “CRM,” but Snap is trying to change that.
Over the past two years, it’s put a lot of energy into updating its ad platform, including significant improvements to its performance marketing and direct-response tools.
Snap, which reported Q3 earnings last week, credited the progress it’s made with its DR advertising business as a major contributor to its $1.37 billion overall revenue in the quarter, up 15% year-over-year.
This year, in particular, Snapchat’s product development team has “doubled down” on improving formats, optimization, targeting and measurement within its suite of lead gen tools, Kathleen Gambarelli, Snap’s group product marketing manager, told AdExchanger.
The goal, she said, is to drive ROI for advertisers, particularly small and midsize businesses (SMBs), so they can focus on building their customer base and driving lower-funnel conversions.
Always be customizing
Over the summer, Snap introduced improvements to its lead gen ad format to make the intake form more customizable, including a date widget, multi-select options, autofill features and the ability to ask eight total questions instead of three.
SMBs without the resources to create their own capture form can use Snap’s native version, but advertisers can also redirect users to their own website instead and still use Snapchat’s marketing pixel.
The new Snapchat form also integrates with several CRM platforms, like Zapier, as well as with Google Sheets in November as a lower-cost option for smaller businesses. Previously, lead reports would have to be manually downloaded and input into each CRM platform separately, which many marketers told Snapchat was a huge obstacle for their business.
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So far, it seems like Snapchat’s new-and-improved ad platform was worth all the effort it took to build.
Over the past year, the number of active advertisers on Snapchat has doubled, according to the most recent earnings report, and direct response ad revenue is also up 16% YOY (although Snap did not disclose specific numbers).
According to Gambarelli, cost per lead is down 69% since Snapchat’s optimization updates, while form submission rates are up 62% and click-throughs have increased by 21%.
In one recent case, the University of Idaho used Snapchat to target prospective students for undergraduate enrollment. The campaign generated 69% of all student conversions, and 22% lower cost per acquisition compared with other social media tactics.
Protecting the leads
Beyond driving student applications, advertisers have also used Snapchat’s new ad platform to generate leads for potentially large purchase decisions. Car manufacturers have used the forms to book test drives, and insurance agents have used them to seek consumers interested in quotes.
But lead generation has an unexpected dark side. Earlier this year, for example, lead gen ads on Facebook and Snapchat became important pieces of evidence in a civil lawsuit alleging health insurance fraud (although it’s worth noting the plaintiffs reportedly routed people who clicked on the ads to their own intake form).
Rooting out these kinds of bad-faith actors typically falls “upstream” of the ad platform itself, Gambarelli said, starting when a business first sets up its profile. Both automated and human-moderated processes are in place to vet businesses and their ad campaigns to ensure everything is compliant with Snapchat’s advertising policies.
Beyond that, Snapchat has also embraced Apple’s AppTrackingTransparency framework as part of its broader approach to privacy and gives users the ability to opt out of data collection.
“Privacy has always been part of Snapchat’s DNA from the very beginning,” said Gambarelli, referring to the app’s origin as an ephemeral, auto-deleting message service. “And that’s informed how we have approached the building of all of our monetization solutions.”
Correction 11/5/2024: This article has been updated to reflect that as of writing, Snapchat’s integration with Google Sheets is still forthcoming.
