Reddit’s Ad Business Grew 41% Last Quarter. Marketers Still Want It to Do More.

Reddit has a unique ability to integrate advertisers’ content into online communities where people are the most passionate about a given topic, said Carly Carson, head of integrated media at marketing agency PMG.

But it still needs to help advertisers better capitalize on that ability, Carson said. “We are hoping to see Reddit continue to expand its mid- and low-funnel capabilities to help brands drive immediate conversion outcomes,” she said.

Reddit is working to improve search on the platform, another opportunity for ads, executives said on the company’s earnings call.

“For many users, they’re literally typing into a box exactly what they’re interested in,” Chief Executive Steve Huffman said on the call.

Some industry players agree. 

“Redditors use the platform like the average person might use Google,” said Colleen Fielder, group vice president for social and partner marketing solutions at programmatic advertising and media automation software company Basis Technologies. “They’re seeking research and advice on products and services from others. Being able to align your ads with communities and keywords to show up within that conversation is especially powerful.”

But Reddit is still playing catch-up with other platforms when it comes to capabilities including ad formats and measurement options, Fielder said.

“Because Reddit users are anonymous, it can be difficult to really hone in on a specific audience or understand how specific audiences are responding,” she said.

Reddit is enjoying a growing profile in pop culture and a consistently engaged community, among other factors leading to its recent success, said Matt Larson, vice president of media and connection strategy at media agency Collective Measures.

While Reddit lags behind large companies such as Meta in sophistication and scale, its potential is clear, Larson said. The question is where its ad capabilities go next.

“With the right creative strategy, the ability to target highly engaged audiences—including very hard-to-reach segments like [men 18 to 49 years old]—provides a lot of upside for growth in media investment if they are able to evolve the ad product without alienating their core users,” Larson said.

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