If you’re looking to add a new dimension to your paid social campaigns, then Snapchat can be an excellent choice.
This unique platform allows advertisers to connect with a diverse audience of users through innovative formats and smart targeting. With the right strategy, Snapchat ads can open up new revenue streams and exciting new customer segments.
Sounds pretty good, right?
But they don’t call it ‘paid’ social for nothing.
So how much will Snapchat advertising cost?
In this guide, we’ll explore every element of Snapchat pricing, equipping you with the knowledge you need to budget effectively for a campaign. Let’s dive in!
Are Snapchat ads worth the investment?
Before we dig into the costs of running a Snapchat campaign, let’s start with the basics.
Are Snapchat ads really worth the investment?
Snapchat offers e-commerce brands some top-notch marketing opportunities.
Firstly, the scale of the platform is a major benefit, with 347 million monthly active users worldwide.
For brands looking to engage with a younger audience, Snapchat is ideal – 39% of users fall between the ages of 18-24.
However, the Snapchat user base has continued to diversify over the years – 36% of users are now aged between 25-49, meaning brands aren’t limited to reaching a Gen Z audience.
Snapchat also enables brands to run some highly effective ad formats.
Brands can access more standard formats to drive reach and visibility (i.e. Image Ads and Video Ads) but they’re also able to deploy innovative formats like Lense AR Experiences and Branded Filters. These can deliver some truly impressive engagement numbers.
Snapchat ads can be a solid investment for many e-commerce businesses.
They have several different ad formats to choose from including Single Image or Video ads, Collection ads and Story ads.
But let’s take a closer look at how much Snapchat ads cost and how costs are measured on the platform.
How do I measure the costs of Snapchat ads?
Before launching a shiny new Snapchat ad campaign, it’s important to understand how Snapchat ad costs are calculated.
Snapchat works on a goal-based bidding system, delivered through the Snap Ads Manager.
This means the platform optimises towards your specific campaign objectives – such as video ad views, app installs and product purchases.
Advertisers are billed on a Cost Per Thousand (CPM) basis, meaning you’ll be charged for every 1,000 impressions delivered, not for specific outcomes.
However, the Snapchat algorithm works in the background to optimise performance and maximise the results achieved by these impressions. Your ads will be targeted towards the users most likely to convert.
Ad quality is also a factor in how much you will pay.
Advertisers can also bypass the Ads Manager and purchase directly from Snapchat, paying a flat CPM for the ad space. However, this option is generally only used by brands with larger marketing budgets, who are essentially buying ad space in bulk.
How does goal-based bidding work?
Your Snapchat advertising costs will be directly impacted by the bidding strategy that you use during your campaign.
There are four main types of bidding strategies available on Snapchat. Each focuses on achieving your objectives in a slightly different way, and each will change the way that your budget is invested.
1. Auto Bidding
Auto-bidding permits the Snapchat algorithm to bid on your behalf, dictating how much you’ll pay for impressions.
Advertisers set a daily budget, and the platform optimises delivery to maximise the number of goals achieved. This approach is designed to spend your daily budget in full, using every penny to drive as many actions as possible.
2. Target Cost
This strategy allows you to define an average Cost Per Action (CPA) for your ads, setting a target for the Snapchat algorithm to aim for.
Although the platform can’t guarantee conversion volumes, if you have a good idea of what you’re willing to pay for an action (e.g. an app install or sale) this can be a sensible way to run your bidding.
However, setting your target CPA too low can restrict budget delivery and scale.
3. Max Bid
Setting a max bid places a cap on how much you’re willing to pay for impressions.
While auto-bidding gives the algorithm full control over how much is spent to deliver an impression, the max bid approach allows you to set a limit on the bids.
It’s worth noting again that setting your max bid too low can impact delivery and the scale of your campaign.
4. Minimum ROAS (Return On Ad Spend)
This strategy tells the Snapchat algorithm to aim for a minimum return on ad spend – it also considers in-app purchase values to optimise more effectively.
This is a smart way for advertisers to run more efficient campaigns and utilise real data to inform bidding. However, it does require that advertisers pass back purchase data to the Snapchat platform.
The Snapchat algorithm is pretty intelligent. It can process a lot of data in order to make better decisions.
There’s nothing wrong with leaning on the platform to help spend your budget efficiently!
How much do Snapchat ads cost?
Now that we’ve covered the fundamentals of Snapchat bidding, let’s look at some average costs for the platform.
The average CPM is £2.23 on Snapchat – this is much cheaper than competitor platforms like Facebook (£3.87) and Instagram (£3.17) so it’s a great option if you’re on a tighter budget.
You also won’t need a huge investment to get started with Snapchat ads.
The minimum spend is just £3.78 per day, meaning you can always start with a small spend and increase budgets over time.
What about direct ad buys with Snapchat?
If you’re looking to buy ad space directly (rather than through the Snap Ads Manager) then you’ll be paying a flat CPM that varies by format:
- Single Image/Video Ads – £2,266 per month
- Sponsored Lenses (Sun-Thu) – £339,950 per day
- Sponsored Lenses (Fri/Sat) – £377,722 per day
- Sponsored Lenses (Holidays) – £528,811 per day
It’s important to remember that Snapchat costs are influenced by several different variables, and these average costs are just guidelines.
Competitor activity can rapidly drive up the price of ad formats since more brands are bidding for the same space.
The same applies to your target audience. If your prospects are being targeted by multiple businesses, you’re likely to pay a higher CPM.
As a result, you’ll often see fluctuations in spend, which is why carefully monitoring your bidding strategy and campaign delivery is important.
How to make the most of your Snapchat budget
It’s important to wrap your head around the Snapchat bidding system and average costs – but it’s also important to understand how to make your budget work harder.
Starting small with your Snapchat campaigns can be a sensible move.
Since you don’t need mountains of budget to get started, you can easily test the waters and build up some initial learnings. Experiment with different formats, trial a few audience segments, and monitor how your bidding strategies perform.
As you gather more insights about the best performing tactics, you can increase spend effectively and deliver superior results with your budget.
It’s also important to focus on producing high-quality ads that are targeted to a relevant and receptive audience.
Although Snapchat doesn’t have a fixed ‘quality score’ like Google or Facebook, the performance of your paid ads can have an impact on your bidding success and cost-efficiency.
Snapchat claims that successful bids are not “solely selected based on the advertiser’s monetary bid”. They’re also selected based on relevance and quality.
If your audience is clicking and converting like crazy on your ads, then you’re likely to see more success when it comes to the auction.
You don’t need to commit to a huge campaign budget to get started on Snapchat.
The platform is very accessible for new advertisers, and it’s possible to achieve incredibly cost-efficient results. You just need the right strategy in place.
Pay attention to your bidding costs and performance, ensure that you’re running quality assets, and regularly monitor delivery to stay in the loop.
If you follow the above, you’ll be able to drive optimal results from your investment and smash your Snapchat goals. Best of luck!