What Types Of Companies Does Snapchat Appeal To For Marketing?

Snapchat Struggles Since IPO Launch

Since Snapchat’s IPO launch on March 2, 2017, it has been struggling with user growth and stock prices. According to a recent Social Media Examiner Survey, in Snapchat’s first quarter they were only used by 7% of marketers, whereas Facebook was used by 94%. Pinterest, Instagram, and Twitter also had greater marketer use than Snapchat. Snapchat’s financial issues could be due to the lack of interest from large companies since its ROI is remarkably low compared to Facebook, and falls behind Twitter, Instagram, LinkedIn, Pinterest, and SlideShare. For large companies, who use data and research such as those to determine which social media platforms to use, Snapchat is unappealing.

Opportunity For Small Businesses

From a small business perspective, Snapchat has a enticing format due to its structure, advertising opportunities, and segmentation abilities. Although similar to Pinterest in this regard, Snapchat’s structure is more limited than Pinterest in relation to the degree of advertising they can apply without losing interest of its users.


Snapchat offers three advertisement products including the following: Snap Ads, Filters, and Lenses. Snap Ads are full screen displays and can be picture form or video that's either motion graphic, gif style, cinema-graph, or live. Filters, also known as Geofilters, are beneficial because of the specific location area and age that can be targeted to match your business or event. These filters are then shared (hopefully) among friends which furthers your reach geographically. The cost of Geofilters can be based on numerous metrics including: paid impressions, earned impressions, total impressions, shares, share rate, camera time, and paid reach. Lenses are a more interactive version of Geofilters. Lenses allow users to interactively engage with your brand via augmented reality as well as share with friends.


Geofilters can be classified as either sponsored or on-demand. Sponsored Geofilters, snap ads, and sponsored lenses require direct contact with Snapchat and are tailored for larger companies. On-demand Geofilters are self-serving advertising for small businesses. Small businesses can visit the Snapchat Geofilter page and either create or upload a customized Geofilter that applies to your brand. You also choose the specific dates that the Geofilter will be available within a geographical area which range from 20,000 to 5 million square feet. On-demand Geofilters can cost anywhere from under 100$ a day or can be in the thousands, primarily dependent on the geographical area your choose. For small businesses this can be a very low-cost form of advertisement. However, its effectiveness is dependent on many variables. Small business have to keep in mind that most users are under 25. Your companies’ target market must match the users on Snapchat. However, your geographical area may have a higher age demographic that aren't as present on Snapchat which would affect your reach. You must also consider the effectiveness of your Geofilter. It has to be appealing enough to users that its worthy of choosing over other filters, including non-branded filters, and then shared among friends. Small business who have a luxury type brand wont have as much difficulty because people like to be associated with higher-end brands. Necessity or non-luxury brands will have more difficulty creating appeal in their Geofilters. This is another way in which Snapchat is limited in its appeal to businesses. For a non-luxury brand, investing in marketing that has high potential to be ineffective will deter many from choosing Snapchat for investing marketing dollars. However, an appealing Geofilter that is shared among users has the ability to broaden your reach and extend past your geographical area that you paid for. This is one of the major appeals to choosing Snapchat as a marketing tool. Taking into account these variables, small business must determine whether Snapchat is a viable tool that can benefit their marketing campaign. Since Snapchat is not yet flooded with advertising, its brand impact may be higher than more highly advertised and established social media sites like Facebook.