CEO Evan Spiegel made the announcement on the upcoming feature of the app at the Vanity Fair New Establishment Summit. In his interview with broadcast journalist Katie Couric, Snapchat co-founder Spiegel said that Snapchat will soon be having ads which will be incorporated in the app's 'Stories' feature in an opt-in viewing.
Based in Los Angeles, Snapchat is a company that created the mobile application that allows users to send disappearing photo messages and videos. Other features that users enjoy are self-destructing selfies and 10-second stories.
Snapchat is experiencing a rapid growth with its users reportedly sending over 700 million disappearing messages a day. The number of viewed stories is also recorded to have reached over 500 million a day.
With the growing popularity of the app's messages and stories, the company realizes it's about time that ads appear in Snapchat.
"We're cutting through the new technology around ads to the core of it, which is telling a story," said Spiegel. "People are going to see the first Snapchat ads soon, they're going to be around our Stories product."
Spiegel also said that the new ads feature would not be target-oriented. Moreover, users will have the option of viewing the ads or not.
Compared to Twitter and Facebook, this strategy of ad viewing in Snapchat may just stress the fact that the company collects less user information. Since the ads are not targeted at users, they would just be placed as an insert in the story. Only those who are using the app can take a look at them.
Based on this description, it would seem like the ads will not in any way interrupt the usual messages that users exchange with each other. It would perhaps appear like a slideshow of photos and videos.
Emily White, Snapchat's Chief Operating Officer, explained the new service at the recently concluded Advertising Week conference in New York. Furthermore, the company also hired Mike Randall, Facebook executive, who would lead its advertising segment.
"Brands are going to have to figure out how to get super creative," said CEO Shafqat Islam of NewsCred, a company that creates content-marketing software. "Just think about these agencies - they're used to creating either 30-second spots that cost millions of dollars, or display ads. Now they're going to have to make snaps."
As part of an elite group of technology startups, Snapchat's valuation is now in the eleven-digit range. The company stands close to other successful startups such as Airbnb, Dropbox and Uber which have a valuation of $10 billion or more.
