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Why Reddit’s rolling out an in-house agency for advertisers

KarmaLab could help the platform build its growing ad biz even further.
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Reddit / Francis Scialabba

· less than 3 min read

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Last week, Reddit announced it’s starting an in-house creative strategy agency for advertisers.

  • Dubbed KarmaLab, the agency will help Reddit’s advertisers (you? maybe?) create campaigns.
  • Reddit said costs are determined “via a scaled offering dependent on campaign objective and need.”

Reddit’s past brand safety issues have made advertisers think twice about the platform, but it’s taken steps to address them in recent years.

  • For example, it shut down thousands of its most controversial subreddits last year, and collaborated with Oracle Data Cloud to provide brands with real-time brand safety controls.

According to Reddit, KarmaLab has already helped brands like Samsung and EveryPlate create custom campaigns for the platform. The agency comes along as Reddit’s ad business grows; in October 2020, eMarketer said it expected Reddit to make $289.9 million in ad revenue in 2022, up from $212.5 million in 2021. In December, the company told Ad Age it predicted “$1 billion in annual revenue in two to three years.”

Looking ahead: KarmaLab could be the next stage of Reddit courting advertisers to build out its ad biz even further. After all, Facebook has an in-house creative agency too, and let’s just say its yearly ad revenue makes Reddit’s look like pocket change. — PB

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