Snap is making its most aggressive bid for digital ad dollars yet by opening up its platform to the ad masses

REUTERS/Mike Blake

• Following its strong fourth quarter, Snap is making its Marketing API available to any ad agency, brand or ad tech company that wants to access the platform.
• The move represents Snap's most aggressive bid for digital ad dollars yet, as it looks to take on Google, Facebook and most notably, its arch-rival Instagram.
• Opening up its Marketing API will allow Snapchat to cater to an even broader base of marketers as well as prompt a wider variety of ads than the ones that currently exist on the platform.
• "From an ad tech standpoint, Snap has been following the Facebook and Twitter blueprint so opening up the API is a natural," Noah Mallin, head of experience, content and sponsorship at Wavemaker, told Business Insider.

Snap is making its most aggressive bid for digital ad dollars yet.

Following its strong fourth quarter, Snap is making its Marketing API available to any ad agency, brand or ad tech company that wants to access the platform.

The program, which was first launched in 2016, has been closed with limited access to a few companies until now. The move essentially allows any company - irrespective of its size, scope or the scale of the software it is building - to leverage the Snap API to automate its ad efforts or build and sell tools for advertisers to use.

"We've been listening closely to third-party developers as we transition Snapchat ad products onto our self-serve platform," James Borow, Snap's director of revenue programs, told Business Insider. "Today we're opening up our Marketing API to give every developer tools to build the Snapchat ad solutions that perform best for them and their customers."

The move is aimed at the so-called long tail, the thousands of developers and brands that want to customize the platform, build something new or even start a niche ad tech company.

Brands can, for instance, enhance their targeting, creative and measurement across all advertising efforts by easily layering on proprietary data sets through the API. They cal also automate processes like placing orders, or ingest ad metadata and performance metrics into their own data warehouses, ultimately better measuring the success of their ads.

Hootsuite, for example, has built a solution that allows its customers to manage their Snapchat Geofilter ads from within its tech platform, which has been helpful for customers that want to buy Geofilters for multiple locations at once and plan all of their ad spend collaboratively on one platform. It hopes to continue to build on the API.

"We're particularly excited to see how our customers leverage the new Snap Pixel," said Stefan Krepiakevich, VP of strategic alliances at Hootsuite. "And how it can help advertisers better manage their audience targeting and conversion tracking."

The move also comes on the heels of Snap's major push toward automating its ads and strengthening its programmatic business in recent quarters. Ad volume on the auction increased by more than 4x year-over-year, and over 90% of Snap Ads were bought programmatically during the fourth quarter.

Opening up its Marketing API will allow Snapchat to cater to an even broader base of marketers. While a majority of ads are now sold through automated auctions, there aren't enough advertisers bidding for these spots yet. So an open API will theoretically bring more brands on board. Revenue from small and medium-sized businesses is already rising: it more than doubled in the fourth versus the third quarter, Snap's CFO Imran Khan said.

It will also prompt a wider variety of ads than the ones that already exist on the platform, including ads with calls to action for consumers such as installing apps.

Snapchat has already indicated that it is bullish on such direct-response ads and smaller advertisers. After doubling its total revenue from app install campaigns since the beginning of the fourth quarter, Snap began offering free ad credits to advertisers running vertical video ads last week, primarily targeting advertisers who focus on direct-response.

"These releases are helping drive more spend on the platform, particularly from direct response marketers," said Lance Neuhauser, CEO of 4C, a marketing technology company and Snap Ads partner. "We're also seeing success with brand advertisers looking to complement their TV advertising and reach Snap's core demographic."

Ultimately, opening up the API will allow Snap to significantly boost its revenue by racking up ad spending from advertisers of all sizes using its platform without having to invest in hiring new developers, just as Facebook and Google were able to do.