Snapchat Tests Ad Monetization Capabilities For Content Creators

Snapchat is beta testing a new feature that would allow select creators to add mid-roll ads within Stories and earn money.

The new offering is currently being made available to a small group of U.S.-based Snap Stars, who are creators and/or public figures that have garnered a large following and are verified on Snapchat. A wider rollout is expected to occur over the next coming months.

According to Snap, the revenue share model is based on a formula that considers posting frequency and engagement metrics.

The new ad model marks the social media platform’s latest attempt to create a way for users to monetize their presence on the app. The company’s existing ad model works by introducing ads between friends’ Stories and on the Discover section, which generates revenue for the company but not the creators on its platform.

The announcement comes at a time when Snapchat users are gravitating more toward TikTok-esque content over Stories, which can be found in the Spotlight section. Earlier this month, Snap CEO, Evan Spiegel, revealed that users are now spending less time posting and viewing stories and are instead watching content found within the Spotlight tab.

Following the company’s earnings call, Snap’s stock rose by more than 53% Friday morning after beating analysts’ estimates and reporting its first net profit for the quarter.

The company generated a revenue of $1.3 billion, which was higher than the $1.2 billion analysts had expected. The growth in revenue came along with an increase in the company’s global daily active users, which went up from 306 million in Q3 to 319 million. The company reported an average revenue of $4.06 per user, higher than the $3.79 analysts had expected.

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