YourRevOrg: How Snapchat built revenue strategy around ad sales

A picture is worth a thousand words; it’s also a gold mine if you have the right team to monetize it. Snapchat has embarked on something of an evolution since its launch in 2011. Like the many college freshmen who use it, it engaged in a swift rebrand—yes, it was once (unfortunately) called Picaboo. Fifteen years later, it has extended its reach far beyond disappearing photos: Today the app is pushing nearly 1 billion monthly active users (Instagram has around 3 billion). Stacked up next to the nearly 2 trillion Snaps created in 2025, the growth trajectory seems solid.

You also may have noticed Snapchat’s gradually diversifying ad strategy, which has evolved from the more traditional Snap Ads (between story posts) and Story Ads (in the Discover feed) into new formats, like Sponsored Snaps (appearing directly in chat feeds) and even reminder ads (notifications for upcoming events).

Revenue Brew spoke with Snapchat’s leaders about the brand’s unique approach to ad sales and how it’s driving ROI.

Snapping into action

President of the Americas Mary Ann Belliveau said moving Sponsored Snaps directly into the chat feed was an exciting step for the platform. “We know our chat feature is a very special, private, and brand-safe place, so we determined it was the right time to introduce a sponsored unit in that chat feed because it’s super valuable for our brands,” said Belliveau. 

She cited algorithmic exhaustion, when users don’t want to be “fed information in a certain way” and as a result move into more private spaces, as part of the calculation. “We know from a consumer behavior standpoint that things are starting to change, and people are posting publicly less and getting algorithm fatigue, or algorithm aversion,” said Belliveau.

The company says Sponsored Snaps have driven 2.3x more lift in unaided brand awareness (a brand living in consumers’ minds rent free), 1.4x more lift in ad awareness, and 1.8x more lift in purchase intent than other social media platforms.

“People don’t hate brands; people hate bad advertising. We don’t do bad advertising on Snap,” said Belliveau.

Mapping out an effective ad

Abigail Laursen, senior director of product marketing for Snap’s ads business, said for years brands had been asking about in-chat and Snap Map (Snapchat says over 435 million Snapchatters open the map each month) ads. “These [are] the beating heart of the app. We’re super thoughtful about how we make sure we don’t interrupt a really meaningful moment in a way that’s not going to work,” said Laursen.

Laursen said one of the key challenges of perfecting ads on the app was being in the right place at the right time—that’s where data came in. She said it was important that the ads were relevant to users and something they’d want to interact with.

Under the new Sponsored Snaps strategy, brands like Wendy’s and Experian reached around 50 million users each in just a single day. She said it demonstrates that brands in the upper funnel space (those focused on building brand awareness) are able to achieve broad reach.

Then there’s Snapchat’s Promoted Places feature, which highlights sponsored businesses, on Snap Map. Since Snap Map is so different, Laursen said there is a nuanced process to determine which brands are selected to run ads on the map. One notable success has been Taco Bell, which received more than 1 billion impressions as a Promoted Place in the first two weeks.

The proof is in the impression

If creating “cool” ads was the only goal, Snapchat could be an apex advertiser, but alas, ads are measured by ROI and not ROA (Rad and One-of-a-kind Ad). Sidharth Malhotra, VP, SMB and mid-market, said his team is effectively messaging the ways that ads run on the app and what brands can get from it.

“Brands have always wanted to be more than just a logo on the screen or a packet on a shelf. They want to be that trusted participant in a one-on-one conversation,” said Malhotra.

He says users don’t like being sold to, but rather want to be “engaged in a conversation,” and that a brand can be successful by meshing its message with authentic content. Malhotra said it all starts by helping brands build the infrastructure to measure what they are getting out of running ads on Snapchat, for example, installing the conversion API.

“[This] allows our auction system to understand who your customers are, what messages they may resonate with, and help you target them better,” said Malhotra. Once that groundwork is done, he said tapping into Snapchat’s unique audience is an effective way to solve the “duplication problem,” or offering brands exclusive daily access to users in a key demographic.

“Every day, 40% of US Snapchatters [are] between the ages of 16 and 64. You won’t find them on TikTok; 80% you won’t find on Pinterest,” Malhotra said.

Snapchat’s data shows growth in the SMB segment: E-commerce company Comfrt was singled out as an effective example, achieving a 79% new customer rate, an 85% lift in new site visits, and a 32% increase in revenue year to date.

Zooming out

Parent company Snap beat Wall Street forecasts for Q4 revenue back in February, with Snapchat’s total active advertisers rising 28% during the period, while also announcing a $500 million stock repurchase program. The company’s innovation doesn’t stop with Snapchat: In January, Snap established a distinct subsidiary for its augmented reality glasses, Specs. Despite all of this, it’s been a rocky road for investors to say the least: Snap’s shares are down around 40% year to date.