Big tech platforms are also feeling the pinch of a global economy in crisis.
Take Snap, for example. Analysts at investment firm Cowen & Co. estimated Snap’s ad revenue will be cut by around $709 million, 30% below its prior estimate, Axios reported.
Facing the grim possibility of a long recession, Snap’s ad sales team will have to work harder for every dollar they bring in this year. Most of its key partners — advertisers, agencies and publishers — are facing fundamental business challenges, some of them existential.
In a conversation with Digiday, Snap U.K. general manager Ed Couchman said at a time when users are seeking information from trustworthy sources, its sales teams are heavily pushing its Discover platform to media agencies. Couchman also discussed how Snap is supporting its own teams through this difficult period That includes shifting CEO Evan Spiegel’s “Council” sessions — where ordinarily employees get together in the office and sit in a circle to openly and confidentially discuss their feelings — into Google Hangouts. This interview has been edited for length and clarity.
How are you ensuring your employees don’t suffer burnout?
Suddenly not having the commute — whether that’s a walk, a bus ride, or longer train journey — you now don’t have those physical divides in your day.
I did observe that people were working — and it wasn’t just flexible [hours] — many longer hours. The very simple thing I asked the team to do was at the end of the day — particularly at the weekend — is when you close your laptop to actually mean it and just keep it closed. I know that sounds simple but it’s actually pretty effective to say, OK, that’s the end of the day and I’m going to turn off all my work stuff and technology and do some other things.
How does Snap Council work online?
[Council is] that time we set aside to talk, in a circle in a physical room. I was unsure whether it would work virtually.
Everyone has the Hangout plugin, so you can have a grid with everyone on the call. We encourage people to turn off their Snap camera so it feels very authentic — no dog ears allowed.
I’ve got to say, it’s worked really well. My first one, I had some hesitations. We were asked to bring along our favorite coffee mug. I was like, ‘This is not going to work’. And I cannot tell you how fascinating people’s favorite coffee mugs are!
It’s been brilliant to have a little window into people’s lives and learn a bit more about them. It’s been a small silver lining.
How is Snap supporting its partners through the coronavirus crisis?
With advertising partners, some of them are having office hours — an open Hangout where anyone can drop in. We’ve also shifted a lot of emphasis onto training and product updates via webinar.
We have really accelerated our work with Discover partners. We feel a sense of responsibility to ensure the users are getting factual, credible news stories about the coronavirus. We recently polled [users] and 50% said they relied on news sources from official channels.
We’ve had record highs across loads and loads of different engagement metrics. One of those was Discover content.
Are you doing anything to support news publishers in particular?
We have a responsibility to keep Gen Z and millennials fully informed around Covid. We need the partners to do that. We hear loud and clear [users] rely on trusted news sources. The job we have is to tell media agencies about the value of that and, to be quite frank, sell the media inventory around that because we have a rev-share with them. We are providing incremental revenue for them. We keep promoting the benefits of Discover — brand safe, curated by humans, et. cetera.
Clearly some advertising categories have been hit by the coronavirus. But we are seeing some other businesses that are really thriving, particularly around mobile gaming … d2c brands, ecommerce. They are continuing to advertise and we’re obviously telling them all the good things about Discover.
What are you doing to keep employees informed of the realities of Snap’s own ad revenue impact and also keep them motivated?
The most important thing that I do to tell them how as a business and a platform we have a role to play to stop the spread of the virus. Gen Z and millennials, we are the platform of choice for that.
[We are] providing credible information, the [World Health Organization] donation Lens, we accelerated the launch of “Here For You,” which is around mental health and wellbeing for young people. The job we have to do to increase our advertising revenue basically pays for all that good stuff we’re doing and that’s why our role is so important.
We try to keep them informed of how the business is performing. Because [coronavirus] is not treating all businesses equally, some are more impacted than others. We can have the agility within the organization to make sure we are supporting all of those businesses and also thinking how we can support some of the more disruptive aspects that are continuing to invest in media at this time.
Update: Investment firm Cowen & Co. estimated Snap’s ad revenue will be cut by around $709 million, 30% below its prior estimate. A previous version of this article stated an incorrect figure.
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