Report: Snapchat tests audience network to place ads outside its app

Brief:

Snapchat this year began testing an audience network that lets brands place ads on other apps. The Snap Audience Network extends the image-messaging app's Snap Ads full-screen format to third-party apps, Business Insider reported, citing two unnamed sources.
Snap began the pilot program with a limited group of brands, following up on plans that the company announced last year at its first partner summit. At that time, the company also introduced features for its Snap Kit software tools, including the ability to let third parties integrate Snapchat Stories into their apps.
Snapchat's sales team also began distributing a memo among media buyers to promote the audience network. The memo highlights how advertisers can activate the audience network in Snapchat's Ads Manager dashboard, and use the same ad creative developed for Snapchat, Business Insider reported.

Insight:

Snap's reported test of an audience network that lets brands place ads in other apps is the latest stage of building out its platform to reach a broader audience. The company last year announced that the Snap Audience Network was in development to help software developers monetize their apps, and to give advertisers a chance to reach more viewers with full-screen mobile ads than advertising on Snapchat alone.

Snap had expanded its global user base to 218 million daily active users (DAUs) by the end of last year, but it's not clear how much the Snap Audience Network extends its reach to other apps. Media buyers interviewed by Business Insider said the audience network doesn't provide enough transparency about ad placements, limiting their ability to see which apps carry the ads. That lack of visibility likely will hinder adoption of the audience network as marketers seek to prevent their ads from showing up next to objectionable content.

The audience network also faces hurdles as stricter rules on data sharing and consumer privacy disrupt the digital advertising market. While Facebook and Google have operated audience networks for years, they are shifting their strategies as the regulatory landscape changes to offer consumers more control of their personal data. Facebook on April 11 will shut down its audience network on mobile websites, the social media giant announced last month. In January, Google said it would block third-party cookies in its Chrome web browsers within two years, following previously announced plans to develop audience tracking technology with greater privacy controls.

While Snap has an opportunity to grow its audience network, the company will need to provide greater transparency for advertisers and reassure consumers that their personal information is safe.