Technology, and especially media tech, has immersed everyone’s lives this last 12 months more than ever. How is Reddit going to market and have you capitalized on the fact that everybody is so much more reliant on technology?
It’s funny, if you were to design Maslow’s hierarchy of needs right now, I really think the internet would be at the bottom of the pyramid [laughs]. It used to be friends and family and creature comforts, and now it’s just a good Ethernet cable. So, I think that’s certainly changed. What’s happened over the last year has required people to adapt the way that they get help, collect information, make decisions, make purchases. The whole cycle of the path to purchase has evolved tremendously over the last year.
We saw on Reddit that when the pandemic started in March, nobody knew anything about this virus, just a complete absence of information. Where do you go? Well there’s not a lot of places to go. What you ended up with was people going to the community, r/coronavirus to get information and at least sift through the trickles that were coming in from around the world. I think what you saw was that life changed on a daily and then weekly basis. All of these new needs came up on the first day of quarantine. Whether it was school care, working from home, needing some toilet paper and bread or needing a haircut or having to cancel a wedding, it was all very new to us. But life is trying to continue. So people went to communities to respond because it’s about real people with real experiences with the same issues solving the same problems.
There’s kind of no place else you can go to have that. And it responded so quickly. We saw a huge spike in our traffic, and we saw the retention of that spike which made us think that people really find this helpful. And now it’s become a part of their information gathering part of their life.
The other thing that we saw is people being isolated and being willing to spend time with strangers just to share presence with other people, even if it is digital. For us it’s our broadcast live experience, where you’re in there with other people and somebody’s drawing, or playing music, or whatever. You can interact with these people about their drawing, and about their music, maybe they’re taking requests. You have an interaction happening all of a sudden that feels present and alive. People are taking advantage of that more than ever. It just broke down the barriers and let people really connect and have a moment together and we think that will continue.
Have there been any fundamental changes on the platform to accommodate these shifts? Are they happening organically on what was already there, or did you implement some changes to meet these new habits?
The only thing we did is, because of COVID-19, we did put a banner on our site as basically a public service measure to let people learn more about COVID-19. But other than that, the tools and the shell were already there. The content sprouted up organically to respond to all these life needs. And we’d built the live video platform actually a year ago with people already using it. But we saw a huge surge in usage. The barriers come down to people just popping in half an hour of music to have an amazing present experience, leave and come back. And that’s the change we saw. We also saw the organic path to purchase evolve. Clearly e-commerce has become more important. I haven’t been to a store in a year. I basically spend all my time opening boxes, taking things out of boxes and recycling boxes.
Through things like Reddit communities, social friends, you saw that people were no longer going to a store to touch, feel, talk to somebody about the product. Instead, people were talking to other people who really went through the buying process and had a real experience and Reddit facilitated that conversation. It was a true community. You have people search for things that they’re interested in but it’s a closed loop within Reddit because they make that purchase, they come back and they review and they talk about it. And when they make that purchase, they have incredible conviction because there’s so much trust. They end up doing a lot more research which makes them informed. And as a result, they’re looking at two times the number of brands. And then what happens is they make their decision really fast—almost nine times faster. And they also spend more money while becoming a higher net promoter and higher value customer because of their knowledge, enthusiasm, amount they spend, and sharing that information. And what’s cool is that those people often come back to Reddit to talk about their experience with the product or service.
So many marketers and advertisers struggled during that time to understand customer behavior. All the previous behaviors had to be thrown out of the window. People started from scratch. Did you find that advertisers were desperate to learn what that path to purchase looks like since you had a much more heightened interest in analyzing that?
At some point we were sharing insights, certainly at the beginning of the pandemic and throughout the year on a weekly basis with our partners because the evolution was so quick. It was to inform, not just the changes in the path to purchase but behaviors to inform the creative factor. For three weeks in in March, I’d say humor was not allowed. And that’s pretty severe on a place like Reddit, which has a lot of memes and humor. And the advice that we gave workers was. It is not wanted”. But then it came back. There was a moment when it was very welcomed because people were ready to laugh again. And you could see that. During that time, because things were changing so quickly, we were in very close touch with our partners to provide those micro insights every week to make sure that they were in sync with how people were evolving their thinking and their mood and their feeling.
This year and the last couple of years has seen increased scrutiny on social media platforms in general. Have you had to think about the Reddit brand differently? What are you excited about in terms of future innovation for Reddit as a brand?
Our mission and values have been on the same route and been consistent for the past 15 years. And that’s to bring community and belonging to the world. We have core values on our platform like transparency and authenticity and user control over data and identity and privacy. Those remain the same and nothing has changed on that front. What I think you saw this year though was seismic shifts across tech and social media, but Reddit was pretty quiet. If you look at the election, it was pretty quiet on our platform relative to some of the other ones. And I think that shows the great work we’ve done over the last couple of years on policy, moderation, and other areas of that ilk. So I believe that Reddit is actually in a very good position because of how quiet it was during these tense moments across the media landscape.
Well beyond the collecting information about a highly considered purchase, we haven’t taken advantage of that from a targeting basis. That is an opportunity for us. I think that’s what drives performance. That it has the contextual experience of search and the intent of search but in a content kind of environment which I think is valuable for the brand loyalty. Once you get the information, you make the purchase with so much conviction, you come back and you become a fan, expressing your experience with it. You turn into an advocate, which is very powerful. What we’ve been seeing is people going from zero to advocate on Reddit in a way that they don’t on other platforms. What’s interesting is that we’re the only place where you can actually see the whole thing happen. If you think about a search platform, they’ll see the search, but then they don’t actually know what happened after that. But with us, you can see how that person expressed themselves after that because we have both the content and the intent, so we see the full piece, which I think is uniquely powerful for our partners.
It is fascinating, how much has changed, and people are having to sort of reinvent and reimagine everything about their customers. From your own marketing perspective how have you approached that differently? Do you go to market yourself and telling the story of Reddit differently now than you did a year ago or 15 months ago?
The story is always the same. It’s about how passionate communities drive action. It’s rooted in our communities. That’s, that’s always been our story. It’s rooted in communities. But what’s changed is that we were able to do some research to show its outsized role in consideration in the path to purchase. Those stats will form a partnership with fertile analytics that I think has really allowed us to make the story even more credible with numbers so people can start to quantify the ROI, which is really significant. When you see those numbers, strategically I think what it’s done is solidify for marketers that Reddit has a role to play in this space. That’s incredibly valuable to us. The other thing is that we’ve had incredible organic growth over the last year.
We’ve shown marketers the rise of communities. We’ve been around for 15 years and we’ve grown organically the whole time. We were big before 2020 but the value of communities has increased since then. And you can see that in our traffic growth. It’s up 44% year-over-year and at 52 million daily users now. That’s so powerful. In terms of our marketing, we’ve never actually done any marketing. We’ve always done things organically. We actually did our very first consumer marketing campaign in 2020, which was around a campaign dedicated to voting in the US. Voting is a value of ours and we’re a very mission driven company. Because it was such an eventful year for Reddit, we ended up investing in two pieces of creative to talk to our community. And there were lots of thank yous and appreciation to our community for being amazing this year by showing off their stuff and helping each other out. It’s pretty powerful stuff and it all uses content from the community.
There’s lots of analysis of the differences in generational shifts from Gen X to Millennials and Millennials to Gen Z. How are younger users using the platform differently than their millennial counterparts?
I think younger audiences lean in more to the visual formats. That’s where we see a lot of engagement around video and live streaming. There’s just more comfort in turning a camera on yourself or turning a camera on and posting that. That’s probably the biggest difference. But Reddit has been around a long time and we have a bell curve of users—maybe 50% are aged 18-34. People are really in this mindset of discovering things and that happens when you’re an emerging adult. You’re thinking big questions like “Who am I? What do I believe? What am I interested in? How do I find other people who might share that interest, that philosophy, that life experience with me and help me become who I am or learn more about this?” That’s usually when we see people come onto Reddit. That’s when they discover us, and it has this incredible impact on their lives. Then if you think about your life, you go through all these different life stages. Your identity changes. You’ve become a spouse, a parent, a homeowner, a car owner, a pet owner, maybe you’re deep into football, then you become a gardener, then a baker. All of those things come up and that’s when those people come back to Reddit to spend their time on Reddit as these attributes of their interests and personalities continue to express themselves.