As rival Instagram makes waves in its effort to boost advertising dollar bragging rights, Snapchat is making revenue moves of its own.
Snapchat is already working with big advertisers such as American Express, McDonald's and Hyatt Hotels. But this week, the picture and video-sharing application — which has more than 100 million daily active users — said it will allow users to submit their own customized filters for a specific location on a map. These so-called custom geofilters can now be purchased by users for as little as $5.
A representative for Snapchat told CNBC it will limit most geographical areas to just six or seven geofilters, so users aren't overwhelmed with too many options. Previously, users have been able to use location-themed filters for a neighborhood, city, or even an entire country. Snapchat said it's received more than a half a million user-submitted filters.
Market watchers classified the initiative as a key move in the ongoing social media monetization game, and comes on the heels of a CNBC report that Snapchat has been forced to cut its ad rates with major advertisers.
Debbie Williamson, an analyst for eMarketer, thinks the new model will be used by some users, but its appeal will be likely for either a limited event or small business. "It's instant branding, and more importantly, it's tied to a specific location, so you're not paying to reach people who are on the other side of the world" or country, she said.
She said it's an efficient way of targeting an audience when compared with other advertising methods. "It shows the company is being thoughtful about what its users want," Williamson added.