‘Once we get on plans, we stay there’: How Snapchat is pitching commercials in the U.K.

Over the course of 15 Snapchat Commercial ads bought by a U.K. advertiser during the last year, the cost per thousand impressions flitted between £6 ($7.07) and £7.20 ($8.47), while the completion rates for them averaged over 85%, said a paid media director at one of the network media agencies on condition of anonymity. Other buyers say CPMs can be as low as £2 ($2.35) and as high as £8 ($9.41)

“Commercials are cost-effective and once we get on plans we tend to stay there,” said Ed Couchman, the general manager for Snapchat’s parent company Snap in the U.K. “There are a few media plans we’re on now including social video and display video while we’re also talking to AV teams.”

Other advertisers, however still have reservations over the ads.

“Only a few of our major clients are using Snapchat Commercials,” said the paid media director. “We try to sell it where we can but it takes a while to build out scenarios that show clients it’s possible to get even more performance from Snapchat than Facebook.”

Often, those advertisers aren’t sure of the best way to use Snapchat’s unskippable ads. For example, some advertisers are using Commercials alongside AR lenses. Interestingly, the more ad formats advertisers use alongside each other, the cheaper the cost of the overall campaign as advertisers get to target and retarget the exact same user in a short window of time

“When we have put Commercials on media plans, they’ve performed well on video completion rates and the cost per completed view,” said Sebastian Redenz, head of paid social at Havas Media Group. “Getting to that point isn’t straightforward and the tipping point in many of those conversations comes with being able to demonstrate to our clients that the audience they want really is there.”

To one media buyer’s surprise, the cost per click for Commercials was lower than for the skippable Snap Ads, most notably in Germany where the cost was 86% less. Only in the U.K. was the cost of the standard Snap Ads cheaper than Commercial ones, said the media buyer. Furthermore, the media buyer saw inconsistent engagement across Europe for Commercials.

These inconsistencies make it harder for Snapchat to jockey for space on paid media plans already dominated by its larger, more established counterparts. Granted, the app has emerged a contender for video ad budgets over the last year, and in some cases can account for 20% of paid social budgets.

“There are so many new formats and platforms for advertisers to consider,” said Lawrence Dodds, client director at Universal McCann. “For this reason, those advertisers are increasingly looking to simplify their social strategies where possible so they can focus their spend on the opportunities that drive scale.”

The challenge for Commercials is similar to the rest of Snapchat’s ad business. It’s still not clear to some big-spending advertisers what’s unique about Snapchat’s audience.

“Snapchat’s pitch struggles to articulate what its incremental reach means for advertisers,” said Deborah King, vp, media activation paid social, Europe, the Middle East and Africa, at Essence. “Once we get past this, then Commercials is an easier sell to advertisers because they understand its non-skippable format similar to what they buy on other platforms.”

According to ad buyers, Snap has in place a good product that can justify relatively high pricing.

“Commercials offer a high-quality, premium publisher environment that is billed on a forced view basis,” said Andrew Jude Rajanathan, a global director at Publicis Media. “In terms of performance, it is stronger on view rate but will come with a premium price for this format and ad delivery,”