has lots of users, not much ad traction

With over 200 million registered users,, a lip-syncing app developed by Chinese entrepreneurs Alex Zhu and Luyu Yang in 2014, is catching on in America. is known to be focused on user growth at the moment, not monetization. But the platform is pitching some agencies in the U.S. three ad products. allows users to make funny faces and strike poses in front of their phone cameras as they lip-sync hit songs for up to 15 seconds. Most users are 13- to 24-year-old girls and women, according to App Annie. The app’s niche user demographic presents an ad opportunity for brands that want to engage with mobile-first teens. Yet seems to be struggling to find ad products that resonate in the U.S. market due to outrageous prices of its ad packages and the company’s limited sales outreach, according to media agency executives.

Two media buyers — who prefer anonymity — said is selling three ad formats: vertical video ads that show up in a curated section on a homepage tab, custom challenges where people — typically social stars — create videos around a brand prompt and challenge their followers to do something similar, as well as standard influencer video posts. They said that introduced vertical video ads around three months ago and debuted custom challenges and influencer posts last summer.

One agency executive from the West Coast said that his clients rarely spend on because its ad pricing — very much like Snapchat in the early days — is out of touch. He said that early price points were around $300,000 per day (Snapchat’s early ad products reportedly cost about $750,000 for 24 hours, in comparison), and’s sales reps even quoted ad packages upwards of $2.5 million, which was “too extreme for an unproven entity, and turned off a lot of early investment potential in the platform.” Then one rep recently claimed that average pricing is in the $75,000-$150,000 range for custom campaigns on the platform, according to the West Coast executive.

“We’ve always had inklings of interest in testing across a number of brands and verticals, but it has been too expensive,” he said. “I’d imagine the entry point pricing on [’s ad offerings] will have to come way down if it wants to be a scalable business. The question then becomes, what can you get on that you can’t get on another platform through standard video ads?”

Meanwhile, the West Coast executive said that perhaps since is still small, it has nowhere near the level of account coverage that other platforms do, so’s sales reps don’t talk to his team often. (’s limited sales outreach in the U.S. may also explain why six out of the nine agencies this reporter reached out to don’t even know’s ad offerings exist.)

Another media director from a New York-based agency echoed that sentiment, adding that ad offerings on are still very nascent, and some ad packages are flawed. For instance, while most social stars on strike branded deals through the platform, brands can also reach out to those creators directly without talking to at all.

“Very few of us are seeing vertical video ads running on, so I’m not sure how many ads the company has sold,” said the New York executive. “Also, you cannot buy ads on through API partners. But to be fair, it’s a very young app and still figuring out what its ad deals should be.” didn’t reply to Digiday’s request for comment before deadline.

For agencies that are unaware of’s ad offerings, few are running unpaid promotions for brands on the platform. Executives from shops like Grey, Arnold Worldwide and Attention all said they are still “evaluating opportunities on” Brands like Disney and Coca-Cola have tested influencer marketing on

“ has generated a great deal of traction recently and brands are regularly asking about the platform. But typically falls under an experimental budget and is generally not a top priority,” said Brendan Gahan, evp of social media agency Epic Signal. “It’s something we’ve pitched and explored but have yet to execute a campaign on. Thus far, most brands seem to be dipping their toes in the water, often with influencers.”

Eli Chapman, vp and managing director of R/GA, is bullish on, saying the platform will become the next generation’s go-to social network, and his team is exploring ad deals with the platform under a nondisclosure agreement, although some packages are “too expensive for what a brand would want to pay for a campaign.” At the same time, he warned that since the audience on is so young (with some being under 13), advertisers may face compliance issues.

“Brands are curious about, but none of them yet said that is the thing that we want to crack right now,” said Chapman. “But as the platform gets more mature from a monetization perspective over the next year, and legal questions about the age of audience get solved, I believe that more advertisers will spend there.”

Compared to brands and agencies, publishers seem to be more active on For instance, media companies like Viacom, NBCUniversal and Hearst-owned Seventeen magazine partnered with for original short-form shows last June in an effort to connect with younger audience.

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