Media giant Viacom has signed a multi-year deal with Snapchat that will see the company selling advertising on Snapchat's behalf, a partnership that could see bigger brands appearing on Snapchat's ads, and could serve to bolster Viacom's wavering share prices.
The Viacom-owned TV networks Comedy Central and MTV already advertise on Snapchat through its Discover channels. According to the Wall Street Journal, the new deal will see the two companies working together more closely, with Viacom granted exclusive third-party rights to directly sell advertising on Snapchat's various ad-supported areas, including its Live Stories feature.
In addition, Viacom will add two new channels to the Discover page, with Comedy Central, which currently only operates as a US channel on the service, expanding internationally, and the international-only MTV channel getting a US version. Viacom has said it will invest further in making programming geared towards Snapchat.
"We had early on made a big commitment to developing premium, original content for the channels we had on the platform," said Wade Davis, chief financial officer for Viacom. "Based on the success we had, we started talking about what we could do beyond that."
Philippe Dauman, who succeeded ailing majority shareholder Sumner Redstone as CEO of Viacom last week, has been extremely hands-on in the company's involvement with the picture messaging service, meeting with Snapchat CEO Evan Spiegel and even reportedly weighing in on the colour of Comedy Central's icon on the Snapchat Discover page. His promotion to CEO suggests that the two companies could be involved for a long while.
For Viacom, Snapchat provides access to the crucial millennial demographic that many of its properties are aimed at, and given Snapchat's seeming reticence to adopt too much advertising, places the firm in a powerful position going forward.
For Snapchat, while the company plans to continue to sell most of its own ad inventory, chief strategy officer Imran Khan has said that the Viacom deal "reduces friction" and will enable large brands to buy Snapchat ads as part of a larger TV deal made with Viacom. It also provides the fledgling company with a more experienced partner in the advertising world.
"We identified early on the similarities in our audience with Snapchat as they were starting out," said Jeff Lucas, ad sales chief at Viacom. "They realised early on about our access to the ad market in terms of selling against millennials."