Snapchat wants to get serious about advertising—and it's looking for some much needed help.
The media company wants to build ad technology to automate its ad sales, and as part of the effort, Snapchat is looking at possible ad tech acquisitions to help bolster its in-house team, according to multiple sources.
Snapchat has been in contact with multiple ad tech startups over the past six months, these sources say, including Beeswax, a startup that helps advertisers bid to target particular users, and Metamarkets, an analytics firm focused on programmatic buying.
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Snapchat declined to comment, as did Beeswax and Metamarkets.
The acquisition effort is tied to the company's plans to build out a more mature ad offering to coincide with all of the content it's collecting from both users and publishers. Included in Snapchat's blueprint is a plan to build an application programming interface that would allow Snapchat to automate how it sells ad campaigns, a similar technology already offered by rivals like Facebook and Twitter. These API plans are in their infancy, according to sources. Digiday first reported on Snapchat's API ambitions last week.
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The hope is that by automating the ad-buying process — Snapchat currently uses a sales team to work directly with brands and media buyers — it can dramatically boost revenue, an important focus now that its ads business is more than a year old.
One hangup in this whole automated ad tech plan: Snapchat doesn't seem to have a very solid idea for how to get there. CEO Evan Spiegel and Snapchat don't have a strong understanding of ad tech or what needs to be done in order to get some of these plans off the ground, numerous industry sources familiar with the company's plan tell Re/code.
That's not necessarily a surprise. The API plans are at their earliest stages and Spiegel has no background in ad tech, which is inherently complicated. The company has only been selling ads for a little over a year, so advertising in general is still pretty new. That lack of familiarity explains, though, why Snapchat is looking for outside help in the form of an acquisition.