Reddit to put ads in conversation threads, claims 10% conversion increase

News 2 Sep 2021 - 2 min read

Reddit to put ads in conversation threads, claims 10% conversion increase

By Sam Buckingham-Jones - Senior Writer

Reddit launches conversation placement ads.

Reddit is continuing its drive to become a walled garden, launching Conversation Placement ads.

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Tags: Reddit programmatic advertising walled garden

Reddit users contribute to 350,000 conversations on the platform every day and 42 per cent of a user’s time is spent in conversation threads. Now the platform is rolling out Conversation Placement ads, right at the top of the thread.

What you need to know:

Reddit has launched a new ad spot: Conversation Placement, which puts a promoted post immediately underneath a user’s post and above the first comment. Reddit says this is when the audience is “most engaged”.
The social platform has been building walls around its garden over the past year and stopped running ads programmatically in April this year.
It comes as Reddit opens an office in Australia.

Social platform Reddit has unveiled its newest ad spot – at the top of conversation threads, claiming testing has shown the placement increases clickthrough rates and conversions while lowering costs by 23 per cent.

Earlier this year Reddit, which opened an Australian office in July, stopped allowing programmatic advertising in a bid to create a walled garden and generate more sustainable revenue.

It reported a 192 per cent increase in revenue and made its firs $100 million in advertising revenue for Q2 2021 after stopping programmatic ads. Its co-founder and CEO, Steve Huffman, said the platform planned to go public.

Today, Reddit has rolled out its latest advertising product: Conversation Placement. The ad spot will put a promoted post under the original post in a conversation thread but above the first comment. It is the first time Reddit ads will appear in conversation threads.

“Conversation Placement is an opportunity for all Reddit advertisers to drive engagement on the platform, positioning themselves right where people are connecting with one another, in a way they can’t on any other platform,” Reddit Global EVP and President of Advertising, Harold Klaje, said.

Reddit has been testing the ad spots with more than 600 advertisers for 12 months, running campaigns across entertainment, consumer tech, finance, publishing and CPG. Beta test partners reported a 9 per cent increase in CTR, 10 per cent higher downstream conversion rate, and 23 per cent lower CPCs when using both Conversation Placement ads and Feed ads.

Test partners included HBO Max, Adobe, Monday.com, the Washington Post and Nespresso.