Snapchat is shutting down its Lens Store after launching it in November. Despite the fact that tens of thousands of lenses ($.99 each) were being purchased per day, Snapchat wants to focus on its advertising business.
Lenses were Snapchat's first foray into in-app purchases, along with paid replays of snaps. They let users add animated facial filters to their selfies.
Snapchat initially gave Lenses away for free but began charging for some of them in November with the launch of the Lens Store. Snapchat also sells Sponsored Lenses to advertisers, which allow users to use certain limited-time Lenses — like this one for Beats — for free. Some cynics in the advertising industry had questioned whether Snapchat's move to charge for Lenses was to encourage more user engagement with the free, Sponsored Lenses. Despite closing the Lens Store, Snapchat will continue to sell Sponsored Lenses to brands.
It's not totally clear why the company can't run both in-app purchases and ad campaigns (~$300,000 per month on Lens purchases sounds nice to have). But the company is relatively lean with 500 or so employees and wants to shift resources to the highest monetization opportunity.
2015 was Snapchat's first big push into advertising, and it was a bit of a bumpy ride. The company lost or let go of at least eight executives and some advertisers have complained that the company doesn't have enough data and engagement metrics to justify big campaign spends.
Snapchat is working to solve those issues. It's reportedly eyeing in-house ad tech solutions, and it's been building tools for advertisers behind the scenes. It also ramped up on targeting and measurement capabilities with the help of marketing research partners like Nielsen and Millward Brown.
Some big-name brands like Coca-Cola, GE, McDonald's and Verizon have all advertised on Snapchat in the past year, and the company says 90% of its top advertisers are repeat customers. Advertisers have purchased placements in Discover, Snapchat's content portal, Stories, a roundup of snaps taken by tons of users at the same place or event, and sponsored Lenses, which users can overlay on their photos and videos to spice them up.
Additionally, the company is ramping up international efforts, where users have grown significantly. Snapchat recently opened an office in the UK with a sales team operating there, headed up by Facebook's former director of agency partnerships, Claire Valoti. Of Snapchat's 100 million daily active users, over half are outside the US; the UK is Snapchat's second largest market.
Snapchat's Lens Store may be shutting down, but users will still be able to keep and use all the Lenses they've purchased over the past few months. About ten free lenses will be available to users every day. The Lens Store will close on Friday January 8.
