Incremental audience attracts repeat business
About 70% of Winclap’s clients spend with Reddit year-over-year, said Keefer. But these are largely relegated to special occasions like product launches, seasonal moments and holidays.
“Brands overall are a little bit more hesitant to commit to joint business plans with Reddit because it is such a new platform, [but one that has] a lot of promise,” she added.
But for some ad buyers, Reddit has already proven itself ready to move out of the experimental ad spend bucket.
Ad agency Tinuiti’s client Liquid IV saw a 41% improvement in conversion rate and a 69% improvement in retargeting conversion rates on the platform. Another health and wellness client saw Reddit’s promoted ads drive more than a 13% lift in unique conversions.
That performance convinced Tinuiti to invest up to 15% of total media spend there for some clients. “They figured out how to tap into an incremental audience that’s beneficial,” said Jack Johnston, senior social innovation director at Tinuiti. More typically, advertisers who see success are scaling closer to 5% in the second year, he added.
Wong wouldn’t share how many advertisers renew each year, instead saying that a good litmus test is its growing number of annual partners. “That’s a strong indication that we are partners at that point, setting annual strategy together year after year. We have a strong retention rate in advertisers,” said Wong.
The search opportunity
Reddit is also working to make its ad placements more relevant to consumers. It plans to add more contextual and interest-based signals to its ad platform, beefing up existing placements in the home feed and conversations, plus adding more formats like video and ads in comment threads and on search pages.
It’s working on building out its search capabilities, as a large amount of intent-based search queries start with Reddit. Monetizing that is not yet in reach.
“There’s a big opportunity on the advertising side—search is driven by keywords and biddable traffic. We already have the foundations of that,” said Wong.
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