Advancing their ad options beyond purchasing on cost-per-view (CPV) and cost-per-impression (CPM) models, Reddit, the social news site, launched cost-per-click (CPC) advertising last month.
What Does Reddit Cost-Per-Click Advertising Entail?
On January 30th, Reddit announced that direct response advertisers are able to purchase any inventory on the platform – for desktop, mobile web and app – on a CPC basis, the site’s first performance-based ad unit.
Reddit CPC ads can be purchased through Reddit’s dashboard alongside their offering of CPM and CPV ads. Reddit’s CPC ads can serve as links or Promoted Posts.
CPC ads may result in better return-on-investment (ROI) for marketers, as proven by Reddit’s beta testing with Wayfair, Hired and Kabam, which resulted in a 50% better ROI.
Why Is Reddit Offering CPC Advertising?
This year, Reddit is focused on broadening advertising tools and building a marketplace that offers more performance-based advertising. So when Reddit found that performance advertisers on their site were interested in setting direct response-focused KPIs, including conversion and traffic goals, but they didn’t have access to the right tools, Reddit began offering CPC. The site is also hoping to attract new marketers.
“While cost-per-click advertising isn’t innovative, in itself, the launch marks a big moment for the Reddit Ads business,” said Reddit’s VP of Brand Partnerships Zubair Jandali. “This is a point of inflection that helps get us to parity in the market and will change the way advertisers think about our capabilities.” In other words, Reddit was behind the times and acknowledged their late adoption of CPC ad offerings.
What Does Reddit CPC Advertising Mean For Marketers?
With the launch of CPC advertising, Reddit now puts themselves in the running to inherit a larger portion of marketers’ advertising budgets. Marketers can now diversify their performance-based initiatives and include Reddit ads in their strategy to reach young, news-focused consumers between the ages of 18 and 34.