"Clearly [the brands] deprioritized it," said Curalate CEO Apu Gupta.
Across the board, ad agencies complain about Snap's lack of data and reporting, including the fact that Snap doesn't show how many followers a person has instead providing a "score." In addition, many users just skip through Snapchat's promoted stories, Trend Pie's Ricci said. Out of 100,000 "views," he estimated only 1 percent actually saw the ad.
In response, a Snap spokesperson said the company has tools like Snapchat Ad Manager, and that it has worked with third parties in order to keep advertisers happy. The company pointed to over 15 measurement products, which it says puts it on with par other major social platforms. The spokesperson also said the company can target specific demographics as well as its competitors.
While agencies expect the company will improve over time, they also say that rival Instagram is far ahead and makes it easy to integrate ad campaigns across other Facebook platforms.
Another complaint: It's hard to find content on Snapchat, which can make advertising ineffective.
"Part of the issue is discoverability," said Noble People media director Matt Borchard. "Instagram is built for finding what you don't follow easily, Snapchat isn't. If Snapchat can figure that out, that will help, because why make content people can't find?"
Social media celebrities are also abandoning Snap in favor of Instagram — where it's easier to measure the size of one's following and use those numbers to score ad deals.
With Instagram's daily active users exploding, social media stars are more likely to spend their time and effort building out their accounts there than on Snap, Trend Pie's Ricci said. When Snap went public, he noticed a rush of influencers asking them to include their Snap accounts as available for advertisers. Since then, many have abandoned their accounts to focus on more lucrative platforms. (Part of Snap's pitch to advertisers is that because it's more private, it has high engagement and is useful for raising brand recognition, making it different from other influencer-heavy platforms.)
"That well has run dry with our influencers," Ricci said. "Most of them no longer reach out to add Snap to their profiles, and a lot of them have listed their pages as inactive. A lot of them are focusing on doing Instagram Stories instead."
And agencies are having issues dealing with the company in general, say multiple sources. Advertiser interest in Snap has remained flat for clients of The Community, said senior director of digital strategy and media Andy Amendola, which should have been higher given the amount of publicity the company has recently gotten from its IPO.
"It felt like they spent all their money at Cannes, instead of doing roadshows and getting in front of agencies," he said. "If they are really interested in making a profit, they should make it easier for advertising agencies to work with them."
A spokesperson for Snap said the company has been doing major outreach and education in the agency world, including at Cannes.
Despite the negatives, Snapchat's young audience still should prove valuable, Noble People's Borchard said.
"My guess is most people are asking themselves: 'Why invest in content on a smaller, and slower growing, platform than Instagram and Facebook Stories?'" Borchard said. "This seems a bit short-sighted though right? Brands should make content for audiences, not platforms. If your sweet spot is 18-25 year olds, Snapchat is probably a good place to distribute content but so is Instagram. I don't think it's one or the other, but finding the right mix."
If they can retain Gen Z and grow among older demographics they can survive, he added.
"For how long, who knows?" Borchard said. "Wall Street might kill them before Facebook and Instagram do."
Disclosure: CNBC parent NBCUniversal is an investor in Snap.
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