This is a guest post on Reddit Ads by Alex Berman of Experiment 27. We worked with Alex to test out Reddit’s advertising platform. Below are the results of that test.
*Updated July 2022
TABLE OF CONTENTS
Are Reddit ads the next thing you should focus on? Online advertising is constantly changing.
As marketers, we have to put our ad spend on the best option. We already know Facebook and Twitter work when done right.
But we weren’t quite sure how to advertise on Reddit, the world’s biggest social forum.
A lot of marketers we know are asking the same question, and Reddit has struggled with it themselves. A new article pops up every week about how Reddit is having advertising revenue problems. You’ll find complaints about conversion, low ROI for businesses, and general opinions that Reddit Ads are the worst idea.
So Reddit is having clear and present issues with driving advertisers, agencies, and businesses to buy ads.
As a distinct platform with its own norms, standards, and subcommunities for every topic you could possibly imagine, Reddit should be a pool of leads. It’s the dream platform for every marketer: a highly self-selected, targeted audience for any interest.
Simply put: with Reddit advertising, the targeting work is already done for you and the opportunity to reach new and active audiences is there.
But it just doesn’t work out that way, and our Reddit Ads experiment shows why. But first, let's get into some Reddit questions.
Welcome to our very first Ultimate Marketing FAQ. Here we’ll unravel the mysteries surrounding ads on Reddit, the social media platform every marketer wants to crack.
You’re probably wondering, why the grab bag approach? Well from time to time, Ladder likes to whisk burning marketing questions about out of the ether and find the answers. For fun, and science.
Plus, when clients ask us, we’ll look super smart.
f(ಠ‿↼)z
On with unraveling FAQ!
Reddit is the fifth busiest website in the US.
It has more monthly unique visitors than LinkedIn!
Yet “the front page of the Internet” has struggled to make money.
This year, Reddit’s annual revenue will top $100 million for the first time.
However, LinkedIn earned $1.3 billion in Q2 alone!
So clearly, there’s more cash to be had for Reddit, right?
The site’s creators think putting new and different ads on Reddit will boost their revenue. They’ve (reluctantly) added advertising options over the years. And taken some away.
Let’s have a look at the timeline.
Now for as little as $20, you can buy sponsored links on reddit: advertising by redditors, for redditors!
—Reddit Announcement on November 12, 2009
The first ads on Reddit showed up in 2009 in the form of sponsored ad links.
In 2013, Reddit marketing introduced display advertising with sidebar banners from Adzerk.
Then, In 2016, Reddit ditched sponsored ad links and launched sponsored ad posts — or Promoted Posts — in their place. And in March 2018, Reddit brought those same sponsored ads to their mobile app.
Last July, Reddit added CTA buttons to their Promoted Posts.
Which brings us to the present day.
When people talk about ads on Reddit, they’re referring to Promoted Posts. That’s Reddit’s native advertising unit.
These sponsored ad posts are just like regular Reddit posts, complete with upvotes, downvotes, comments — the works.
You can see the full ad specs here.
Reddit has decided the best way for ads on Reddit to work is for the users themselves to post flattering content about brands — then have brands promote those posts. That’s because Reddit has been openly hostile towards ads for years.
But if a Reddit user happens to have a good brand experience and share it, that’s… different. ?
(We’ll see how this plays out.)
Reddit user starfishjenga has a great summary of Promoted Posts:
Nothing stops you from posting content you want to promote. But it’ll be obvious from how new your account is that you joined Reddit just to advertise. Redditors will be wary of what you say, so be transparent.
Now, if you’re a “large-scale advertiser with at least a $50,000 quarterly spend,” you can fill out a form. Reddit’s sales team works with you directly and life magically gets easier.
We think you shouldn’t have to spend $50K to get help or good results.
The question you should ask: do ads on Reddit work at all? Before you try them yourself, read ‘The Reddit Ads Experiment: What We Learned for $250‘ above.
When you’re ready, use Reddit’s self serve ad platform. Create an account, then go to the Reddit ads dashboard where you can create your first bit of Reddit native advertising.
? Don’t forget your Best Practices for ads on Reddit.
Yes, ads on Reddit are targeted. You can define an audience based on several details:
There’s a key difference between ads on Reddit and ads on Facebook or LinkedIn. Even though you may be targeting individuals, entire communities will engage your posts (hopefully/maybe).
Think of yourself as a guest — even though you’re forking over cash for Reddit’s paid ads.
Check out our paid Reddit marketing experiment to see how we leveraged targeting.
Reddit says to allow 24 hours for your ads to be approved. We’ve heard ads don’t get reviewed over the weekend — or it could be the weekend reviews are just slower. Hard to say either way.
Last time we tried Reddit paid ads, approval took 2 hours.
In any event, if you want to get your ads on the Reddit marketing platform at a certain time, submit them well ahead.
If you’re having trouble getting your ad approved, post in r/redditads and some kind soul (i.e. customer success rep) may help you out.
If you want the party line on ad approvals from Reddit themselves — including what’ll get your ad canned — head over to their Zendesk.
That’s the least you can spend on Reddit marketing PPC.
You buy ads on Reddit on a CPM-basis, bidding auction-style. And there’s a $0.20 CPM minimum bid.
So your Reddit ads cost ultimately depends on who else is targeting the audience you want (among other opaque factors), and how much they’re willing to pay.
Reddit’s paid ads can feel like a bit of a black hole when it comes to pricing, unfortunately.
To shed a little light, here’s what happened when we tried ads on Reddit:
As you can imagine, we were less than stoked. 🙁
No.
Well, not for us.
We actually got better results from organic posts than ads on Reddit.
So between Reddit ads not delivering for unknown reasons (the Reddit dashboard wasn’t specific), difficult-to-predict Reddit advertising costs, and — y’know what, I’ll let Alex Berman of Experiment 27 bring it home:
We got a clear confirmation that the Reddit community is still ad-proof and smells/ignores promoted posts. That is a huge problem not only for advertisers, but also for Reddit.
We’re calling it on this one for now: Reddit Ads are not part of a good advertising strategy for now.
—The Reddit Ads Experiment: What We Learned for $250
With Reddit hungry for more revenue, and new ad units rolling out, that may change in the future.
We’ll let you know.
A Reddit Ad is a promoted post on Reddit. For those who are not familiar with the term, a Reddit Ad can look a lot like regular Reddit post except for the words “promoted post” indicating that it’s actually a paid piece of content.
This type of Reddit post appears on the top of every subcommunity forum, or subreddit. Sometimes they are posts, and sometimes they’re an ad for companies – it depends on what your intent is with the ad. You can buy them on the Reddit dashboard.
What Reddit promises on their Advertising page is this: “reach more than 234 million engaged and passionate users through a flexible programmatic platform!”
So I was hyped to try it and aware that the Reddit community is growing. If we could get it right, we’d be able to tap into some of the best targeting and one of the most active communities in the world.
But immediately, I came across a slew of red flags. When you scroll down the Reddit Ads landing page, you see this:
In the last few years, Reddit ads have gotten a bit less complicated. However, businesses are still experimenting with Reddit advertising and it’s right there in the testimonials. It's not too convincing for new advertisers, and clearly not a good tactic when it comes to the UX of the platform, but I continued.
Next up, the “ads they’re really proud of”… Really? Proud of a promoted post with a total of 395 votes and 650 comments? You’re the biggest forum alive. That should be more like the minimum exposure someone gets for advertising on Reddit.
Despite all this, I still wanted to try to be successful with Reddit advertising, if only because Reddit is one of the highest ranked websites in the world and I like Reddit as a community.
It looked like a great place to test out ads that might drive ROI for businesses: you can target subreddits, track performance easily, and drive clicks on this part social network, part media platform for a relatively cheap price ($1.50 CPM).
If we could get ads on Reddit to work, it would be very profitable.
So, are Reddit ads effective? Well, it depends. Here's what we found out:
So initially, I did some testing on my own for $50 with guidance from this huge Ladder Growth Strategies blog post. Using that article we wrote four different Reddit Ads for my company, Experiment 27, an outsourced CMO for digital agencies.
I submitted the four ads and waited for approval. (Approval on a Reddit Ad usually takes about 2 hours.)
6 days into the 7-day experiment, one post had 6 comments. But that’s about it. None of the ads were getting much traction.
Since the campaigns started I talked to one lead who couldn’t remember where he found us — said it might have been Twitter, but my analytics showed that was unlikely, so it might have been from Reddit. Not the strongest conclusion either way.
Otherwise, ZERO leads for $50 spent on Reddit advertising — not exactly worth it, especially if you consider the traffic from all 4 ads totaled at around 900 clicks.
The most popular ad by far in this test was the one titled “Agencies that are active on Dribbble typically see 10-14 qualified leads per month from that channel. Find out how we can help you grow your Dribbble account.” This one got 2 upvotes on Reddit and no comments, but it did receive $94.35 of CPM for only $12. So we were driving good traffic for a low cost, but not much was resulting from it.
The most commented ad was the click-baity one “Only 8 spots left – we work with some of the top digital agencies in the world to grow their leads. Will you be left behind?”
Reddit hated this one. I was given a very hard time by Reddit users when I asked for feedback on this ad.
So that was it for the first Reddit Ads Experiment. At this point Reddit advertising did not seem like it was driving good ROI.
All in all, it was a decent way to spend $50 to confirm what others were saying – Reddit is in trouble and their advertising option is extremely weak.
Back in the lab and this time teaming up with the folks at Ladder, the plan was to spend $200 on Reddit advertising, but this time to push traffic to their site, and more specifically their blog posts.
We worked together to choose 4 different pages from the Ladder blog + landing page arsenal to create a series of Reddit Ads, spending $50 dollars on each page and running each ad for 7 days.
The first Reddit Ads were not effective. There was no specific content, and we saw zero conversions.
This time, with Ladder.io we took a slightly different approach and tested sending people to specific content. So we chose:
Working with Ladder’s Head of Content, Stefan, we wrote 5-7 headlines for every one of these pages. They each took a different approach, from article titles to click-baity headlines and more, and then I converted them into Reddit Ads.
With these, I targeted the front page, some specific subreddits, and some groups of subreddits testing everything we could think of.
We created 27 Reddit Ads in total and 7 days later I circled back to see how we did this time.
Stefan from Ladder passed us the reddit ad analytics and here’s what we got for $200:
Reddit ads cost us just under $1 per click.
Let’s jump into the Reddit analytics and see how we did on the actual Reddit Ads:
Compare this with just posting organically on Reddit and you’ll get my point.
When someone posts one of our videos on Reddit, it will get around 3,000 views. One of our videos even got 25,000 views when it hit the top of a subreddit.
That’s 25,000 views for $0.
And this Reddit Ads experiment? $250 with very, very little to show for it.
What’s strange here is that some of Ladder’s blog posts have been posted on Reddit before as standard, regular content. Those continue to get engagement, comments, and drive traffic. Posting them as Reddit Ads got close to nothing, despite Reddit’s clear attempt to make ads as native and natural-looking as possible for their community of users.
Running Reddit Ads ended up being one of the worst user experiences you could imagine as an advertiser.
Getting ads set up on the Reddit Ads platform is a mess. Things start simple enough by asking you for your title and images:
All standard stuff – pop in your creative, write some copy, add your URL, etc…
From there you see a preview of how things will look, and you’ll be able to start selecting your audience for the ad. Specifically, you’ll be able to target subreddit groups, or specific subreddits.
The problems start here – the suggestions listed are entirely off from what the ad is actually going for – SaaS growth tools. Yet the suggestions given are unrelated and useless.
So you’d have to manually discover subreddits, or go for their collections.
But collections aren’t necessarily up to par either.
Ok, some good options there for a lot of different types of businesses, but what should we choose? Technology? Maybe… But there’s nothing here for marketing.
So, discovery of subreddits and selection of collections is lacking from Reddit advertising.
But that’s still pretty simple.
Where advertising on Reddit really gets annoying is when you actually pay for ads.
You have to go into each individual ad you create, hit pay, set up payment specifics, and run the ad.
Every single time.
Yeah, you’ll be able to save a credit card, but the manual process is only slightly shortened with that.
And we also ran into problems with getting multiple ads through the payment system. The system kept declining the credit card we were using over and over, forcing us to give it 15 minutes between setting up payment for each ad. Time-consuming and annoying.
At the time it seemed quite like Reddit’s Ads platform doesn’t like it when advertisers try to run multiple ads. Since A/B testing is key to marketing success, this seems like another reason not to advertise on Reddit.
And that may also be because of the second major problem with the platform.
There’s no getting around this simple truth. Reddit’s users are paranoid about ads.
That’s right: Redditors hate Reddit advertising.
It makes some sense – Reddit used to be entirely ad-free for a long time while juggernauts like Digg were still around and popular. But Digg killed itself with its own advertising strategy, effectively driving away its entire user base.
A ton of Reddit’s users were around for that time and flocked to the Reddit platform as a better alternative. That’s where the anti-advertising attitude comes from initially, but even users who’ve never experienced the Digg are introduced to Reddit as a place hostile to ads.
Combine that with shady advertising practices where advertisers try to pretend they’re normal users, or where they buy accounts to fake trustworthiness, and it’s likely advertising on Reddit will never be seen with anything but distrust by its core audience.
It’s sad that such an amazing, large, and high-quality community like Reddit will never accept advertising.
At the end of the day, Reddit’s growth depends on its ability to keep server costs paid for, continue building new features, make enough money to pay staff, and make investors happy. But it isn’t working, so they’ve had to resort to tip jar style premium memberships in Reddit Gold to supplement ad revenue.
Revenue growth is not up to their own expectations, and part of that is the Reddit Ads problem outlined above.
But that’s not the end of the world. Reddit’s big drive into advertising came as part of their leadership’s drive to become a venture-backed startup. It’s an ambitious goal, but it’s not one that necessarily works well with how people currently perceive Reddit.
Considering the hostile nature of Reddit’s user base to ads, it’s no surprise that ads don’t make as much money as they should with such a targeted audience.
In this case, no, reddit advertising is not worth it. Back to the experiments:
We got a few clicks generated for $250 spent. They turned out to be expensive, and who knows how much we should spend for Reddit to include us in the “Ads we’re proud of” section.
On the other hand, before advertising on Reddit, we tried reaching out to people organically. That actually worked.
Organic traffic brought us far more clicks than paid traffic from Reddit Ads.
More so, we got a clear confirmation that the Reddit community is still Ad-proof and smells/ignores promoted posts. That is a huge problem not only for advertisers, but also for Reddit.
And with all that in mind, we’re calling it on this one for now: Reddit Ads are not part of a good advertising strategy for now.
Reddit has a big problem when it comes to their advertising option and it’s very concerning for the future of the platform, at least when it comes to monetizing via ads. If they can find a way to create trust between advertisers and users, it might work in their favor. Their latest move allowing brands to sponsor users’ posts might be the right answer, but we’ve yet to see results from it.
Until then, Reddit Ads will have to stay on the backburner for our advertising strategy.
To anyone thinking about advertising on Reddit, it’s always good to try new things, but don’t be surprised if your Reddit ads don’t pan out.
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