Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to Axios Closer for insights into the day’s business news and trends and why they matter

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Nashville news?

Get a daily digest of the most important stories affecting your hometown with the Axios Nashville newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Columbus news?

Get a daily digest of the most important stories affecting your hometown with the Axios Columbus newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Dallas news?

Get a daily digest of the most important stories affecting your hometown with the Axios Dallas newsletter.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios NW Arkansas

Stay up-to-date on the most important and interesting stories affecting NW Arkansas, authored by local reporters

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Lazaro Gamio / Axios

Snapchat stories by companies have great engagement stats but the rules Snapchat places on stories mean advertisements must run separately, where the effectiveness is less clear.

Why this matters: Snapchat's parent Snap is preparing to go public with a valuation of more than $16 billion because more than 150 million people use the app every day and investors think that will turn into a gusher of money from advertising. But if advertisers don't feel like the platform is delivering, Snapchat could end up an investor disappointment like Twitter, instead of a home run like Facebook.

A study by Snaplytics finds that Snapchat stories (not ads) have an open rate of 50% and that 88% of people that start watching a story watch it all the way through — up to 11 snaps on average. Those are tremendous engagement stats. But companies can't use those kinds of stories to sell. Snapchat makes companies buy ads if they're going to explicitly push products or market content.

So the question is, are Snap ads effective? We don't exactly know.

  • Maybe yes. Snapchat is private about releasing statistics around their ad campaigns, but ahead of its IPO, they shared a few case studies in its S-1 filing that show the effectiveness of brands using Snap Ads. Han Ma, Associate Director at Ketchum Digital, who works for an array of companies on Snapchat, says overall, companies can leverage more refined targeting methods by buying ads. "Stronger analytics lead to stronger insights, which lead to better opportunities to optimize content and strategies for brands," Ma tells Axios.
  • Maybe no. Some third-party analytics providers say the ads aren't effective marketing tools. A new study by marketing analytics platform Fluent finds that 69% of Snap users report skipping ads on Snapchat "always" or "often," and that number rises to 80% among 18- to 24-year-olds, Snapchat's core audience. Fluent CMO Jordan Cohen tells Axios that millennials use Snapchat as a video messaging service, not a content service, and "that's why advertising in that format isn't that appealing to them."

Snap had revenue of $404 million in 2016, and though the company doesn't break out what comes from advertising, reports suggest that's where it makes most of its money. It ramped up its advertising efforts ahead of filing to go public and last year eMarketer projected the company would gross nearly $1 billion in advertising in 2017, nearly 2% of all social network revenue dollars in the U.S.

The big issue: Timing is a problem here. Snap ads could very well be more effective than third-party studies give them credit for, but ad buyers don't have confidence in the data. Snapchat waited too long to give them the type of measurement and reporting metrics that they are used to getting from companies like Twitter and Facebook, making them skepctical of Snapchat as a good place to buy advertising.

Go deeper

Updated 40 mins ago - World

North Korea claims latest missile test new weapon launched from submarine

North Korean state media claims the country's military fired this missile on Tuesday. Photo: Korean Central News Agency

North Korean state media announced that a detected ballistic missile launch off its east coast on Tuesday was a newly developed weapon test-fired from a submarine.

Why it matters: Pyongyang's latest in a series of recent missile launches into the sea happened hours after U.S. officials emphasized their commitment to restart negotiations on North Korea's nuclear weapons program, which have stalled since talks broke down during the Trump administration, AP notes.

3 hours ago - Politics & Policy

Manchin's massive means test

Illustration: Aïda Amer/Axios

Sen. Joe Manchin (D-W.Va.) is offering progressives a trade: He'll vote for their cherished social programs if they accept strict income caps for the recipients, people familiar with the matter tell Axios.

Why it matters: Manchin’s plan to use so-called means-testing for everything from paid family medical leave to elder and disabled care would drastically shrink the size and scope of the programs. It also would bring a key moderate vote to the progressive cause.

The China whisperer

Nick Burns. Photo: Chen Mengtong/China News Service via Getty Images

President Biden's nominee for ambassador to China will face aggressive questioning Wednesday about the most important, and potentially perilous, bilateral relationship in the world.

Why it matters: While Nick Burns is an experienced diplomat with support on both sides of the aisle, lawmakers want to use his confirmation hearing to force the administration into some tough positions on China.