Snapchat is testing mid-roll advertisements that appear in
the Stories of a small group of US creators, introducing a new way for creators
on the app to earn money.
A wider rollout will be happening in the coming months. When
an ad is placed within a Snap Star's Story, Snapchat will share the revenue
with the creators. The company says the revenue share is based on a formula
that takes into account metrics like posting frequency and engagement.
The feature is only available to Snap Stars, who are
creators or public figures with large followings that have been verified on
Snapchat, indicated by a gold star.
In recent years, Snapchat has added various ways for
creators to monetise their presence on the app. Snapchat users already see ads
in between friends' Stories and on the Discover section, but this is the first
time creators will get a cut of the ad revenue on Stories.
This comes shortly after Snapchat signalled that users were
moving toward TikTok-esque content over Stories. Snap CEO Evan Spiegel told
investors earlier this month that users are spending less time posting and
viewing stories and instead were watching content on Spotlight, Snapchat's
TikTok equivalent.
In an effort to entice users to create more vertical video
content for Spotlight, the company announced it would pay out $1 million per
day through the end of 2020. Now, Snapchat says it pays millions of dollars a
month to creators making top Spotlight videos.
Last year, Snapchat announced Spotlight Challenges - cash
prizes for users creating top videos using specific lenses, sounds, or topics.
The company says it paid out more than $250 million to creators in 2021.