Snapchat's latest feature converts its lenses and filters into shopping vehicles - and fixes its biggest flaw to date

• Snapchat is rolling out Context Cards for its sponsored lenses and filters.
• These cards not only let users learn more about brands and their products, but also drive them to an action, like purchasing a movie ticket.
• Context Cards essentially turn Snapchat into a shopping vehicle and a place where brands can directly track ROI, thereby addressing one of the platform's biggest flaws to date.

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Snapchat's augmented reality-powered lenses and filters may be some of the most creative ad products out there, but advertisers have long lamented not being able to drive returns on their investment by using them.

That is set to change, with Snapchat rolling out Context Cards for its sponsored lenses and filters.

Starting today, advertisers can add Context Cards to their lenses and filters for free, providing users more information about the lenses and filters they play with. Users can swipe up on any friend's snap that includes a sponsored lens or filter and open up the linked website URL without leaving Snapchat.

But more importantly, Context Cards let advertisers directly track their ROI (return on investment). Until now, advertisers could use sponsored lenses and filters to track engagement: the number of people that played with them and for how long. But now, they will be able to quantify whether those filters and lenses actually drove action, such as a purchase or a click to a website.

What are context cards?

Context Cards for lenses and filters essentially turn Snapchat into a shopping vehicle and a place where brands can directly track ROI.

A film studio that runs a lens for an upcoming film, for example, could add a Context Card that links to a website selling tickets for the film. Or a makeup brand could run a filter touting a new lipstick, and then link to a website where users who tap the Context Card could get a discount coupon and purchase it.

Entertainment company Lionsgate is the first brand to run a Context Card alongside a lens. The company is attaching a Context Card to a lens it is running on Monday for its upcoming film "Wonder," which opens this Friday. The lens celebrates "World Kindness Day," and if users swipe up on the Context Card, it leads to a URL where they can insert their location, view screening times and purchase tickets. It is the twelfth lens that Lionsgate has run on Snapchat so far.

"We're excited to be the first brand partner to add a Context Card to our Snapchat Lens," Danielle DePalma, Lionsgate's executive vice president of worldwide digital marketing, told Business Insider. "We're thrilled that this format can also now drive viewers at scale right to our website, to learn more or purchase a ticket to our film."

Context Cards elevate Snapchat from a mere engagement play to a platform that advertisers can use to actually drive and track returns on their spends. And in doing so, it fixes perhaps what has been its biggest challenge to date.

"It's a smart move, particularly at a time when brands are questioning their role in the marketing ecosystem," said Tom Buontempo, president at ad agency Attention. "The more they can show that they can help advertisers actually drive their business, the more likely they are to get more advertiser revenue."

Snapchat first introduced Context Cards last month, allowing users to swipe up to see relevant information about the location of a photo or video snap message, including reviews, contact info, directions, and more without ever leaving the app. Context Cards for lenses and filters mark the first step to monetize the format. The move also allows Snapchat to demonstrate that sponsored lens and filter campaigns can actually drive an action.

The right thing for Snap, at the right time

It comes at a good time for Snap, as things have not exactly been looking up for the company lately. Since going public in March, Snap has reported a string of disappointing losses in revenue coupled with slowing user growth, most recently losing $443 million in its third quarter.

"This moves the needle to drive people further down the purchase funnel," said Buontempo. "The more you can prove direct attribution, the more likely you are to convince advertisers that you are more than an experimental platform, and boost your own bottom line."

Snap CEO Evan Spiegel too seems bullish on the product. In the company's third-quarter revenue earnings call on November 8, he said Context Cards represented "the next generation" of its augmented reality products.

"We will be building on top of the Context Cards framework with additional partners as we learn more from our community about how they want to use this new product," he had said. "With all of the Snaps and Stories viewed on our service every day, Context Cards provide a unique opportunity to translate what you see on the screen into action - whether online or in the world around you."

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