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Snapchat finds a new moneymaker: sponsored Discover channels

The first channel is dedicated to the new James Bond movie, including behind the scenes footage

Financial trends and news by Steven Loeb
October 27, 2015
Short URL: http://vator.tv/n/40ed

Snapchat's business model is still evolving to some degree, with the the company still figuring out the best way to make money off its young, and loyal, users. It seems to be taking a page out of Twitter's playbook by hooking up with big media partners who can leverage the platform to help get their message out.

The company's latest experiment is to allow marketers and brands to launch their own channels on its Discover section, the company announced on Monday.

Not only that, but it has already released has its first sponsored channel, too: for Spectre, the new James Bond movie that's coming out in November.

The Spectre channel is clearly labeled as being "sponsored," but otherwise it works the same way as every other Discovery channel, with content that can be viewed for 24 hours before it disappears. That includes a video from stars Dave Bausista and Lea Seydoux, a preview of the new song from Sam Smith, and behind the scenes footage.

Snapchat launched the Discover feature In January as a way for editorial teams to put up their own Stories.

Discover was originally made up of 11 unique channels: one for each media partner, including ESPN, Comedy Central, Cosmopolitan, Daily Mail, Food Network, National Geographic, People, Yahoo News, CNN, Vice and Warner Music, and it has since added channels for Refinery29, Tastemade, IGN, iHeartRadio and Mashable. Each one features photos, videos and other long form content. There is also a Snapchat channel.

Big summer movies, including Mad Max: Fury Road, Pitch Perfect 2 and Jurassic World have all used Discover for promotion, as have brands including McDonald's, Samsung and Macy's, in the form of ads or sponsored content, but this is the first time that Snapchat is allowing an entire channel to be taken over for such content.

From the Bond experiment, it seems like not only will the content only remain up for 24 hours, but so will the channel itself. That means that, once the day is up, you're not getting anything new to see.

"This is a fun way for current and future James Bond fans to experience SPECTRE.  For one day only, Snapchat will be the one-stop shop for SPECTRE content, including photos and behind-the-scenes looks at the making of this incredible movie," Dwight Caines, president, Theatrical Marketing for Sony Pictures Entertainment, said in a statement.

"As it follows on the heels of Skyfall, SPECTRE is one of the most anticipated movies this fall.  It feels great to be bringing that excitement to the Snapchat community."

The partnership between Sony and Snapchat  is going beyond just the Discover channel, as it will also be providers users with a special SPECTRE geofilter on the film's opening day, which are location-based artistic overlays which will allow fans to incorporate SPECTRE art right into their photo or video Snaps.

On top of that, full-screen vertical video ads are also being run in Snapchat Live and Discover in seven territories.

There are a few open questions at this point about sponsored channels, including how many sponsored channels Snapchat plans to have at once, and what the criteria is for getting a sponsored channel, since I assume the company is not opening the door for just any movie or brand to come in and take over for a day.

There is also the issue of revenue, and how much Snapchat is being paid by the owner of the channel to, essentially, rent it out for 24 hours. VatorNews reached out to Snapchat, but a company spokesperson declined to comment further.

It's unknown how much revenue Snapchat is generating from advertising so far. There were somedocuments that leaked over the summer, showing the company making $3.1 million, but winding up with a net loss of $128 million.

The documents only covered the period January to the middle of November last year, a.k.a. the time right before Snapchat started advertising. It was also right Snapchat teamed with Square for the launch of a payments feature called Snapcash, allowing users to send each other money. 

Since then it has started running ads, started allowing users to buy paid replays, and also launched Discover. Now, the company is currently on track to generate $100 million in revenue, according to Business Insider.

No doubt there will be plenty of brands and companies who will be willing to fork over money to get to have their own Discover tab now too.


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