Where did advertisers go wrong with Reddit?

With no resolution in sight, at the time of writing, I’ve been watching the "who will blink first" standoff between Reddit chief executive, Steve Huffman and – in his words – the “overly powerful (Reddit) community” with mild horror.

This r/Disagreement has been playing out rather publicly for the past week, after Reddit dropped the bombshell announcement that from 1 July it will start charging individuals for third-party apps to access data and user information, which rely on its API.

The ensuing mass objections among some of its 57 million daily users are in support of the developers, who have produced some of the most popular mobile apps for browsing Reddit. Developers made these apps before 2016 as Reddit did not have an official app. With charges reported at £20m, the apps will likely close down as a result. But the move could support profitability, boosting Reddit’s expected IPO listing later this year.

In response, thousands of the biggest subreddits have committed to "going dark": locking their communities without posting content. Known for doing things a little differently, the Reddit community has also decided to protest against the decision by overwhelmingly “upvoting” to only post content featuring comedian and Last Week Tonight host John Oliver, when reopening their subreddits. In return, Reddit has reportedly removed moderators and those who voted to include NSFW images. 

While you can’t blame the platform for wanting to make a profit, this crude effort to commodify its online communities shows a real lack of insight into the people who make the platform what it is.

How do you monetise Reddit? 

In Campaign’s recent feature, Alex Underwood, global head of agency development at Reddit, outlined his plan to educate agencies through the lens of a Redditor to understand the platform and its many passionate communities.  

Cracking Reddit for advertisers is a potential goldmine – with 1.6 billion monthly active users, it is considered to be the platform that the vast majority of advertisers have not been able to successfully break into. Reddit is a very unforgiving place if you get it wrong.

Who wouldn't want the secret sauce of reaching hyper-engaged audiences passionate about niche topics? The fact is, advertisers and Reddit itself haven't discovered how to build out advertising on the platform in a seamless or integrated way that fits with the users of Reddit.

Reddit users are vocal. You'll hear of users being served ads with zero relevance to the Reddits they follow, or ads posted by brands and then left to run their course, resulting in poor engagement or being jumped on quickly to be taken over by spam comments rendering the ads useless. There is still potential for Reddit to be a strong platform for advertisers but, given its equally passionate community-led content, it’s a symbiotic relationship.

Reddit is a forum for engagement, so as a brand, you need to be there and willing to be available – you can't just post and disappear. If Reddit management carries on dismissing moderators and users, it’s uncertain if it can still retain its USP for advertisers who want to engage. But Underwood’s strategy for Reddit is sound and the rewards are there if you understand the platform and respect the users. 

As brands are pausing advertising on Reddit, at least for now, they might be asking themselves whether they should give up on the platform. But while it is certainly in turmoil right now, I wouldn’t bet on it disappearing. As a fan, I’m hoping Reddit will resolve the issues with its community, users and developers, and bring back “the front page of the internet”. 

James Hacking is the founder of Socially Powerful.