Alexis Ohanian, Reddit's co-founder, at the WORLDZ Cultural Marketing Summit 2017 at Hollywood and Highland on July 31, 2017 in Los Angeles. (Photo by Jerod Harris/Getty Images for PTTOW!)

With forums featuring controversial content such as “/r/whitenationalism” and /r/gentilesunited,” Reddit Inc. appears to be a potential minefield for advertisers. California-based startup Tab For a Cause CEO Alex Groth was certainly concerned when looking at Reddit as a potential new advertising outlet after seeing other advertisers’ campaigns attracting user comments that often included profanity. But, as Groth points out, Tab For a Cause seeks out engaged users for its own platform, which develops a browser extension to help people donate to charity, and Reddit is known for its passionate base of 330 million monthly users. Reddit also allows advertisers to enable users comments on native advertisements. As a startup co-founder, Groth was used to taking risks, so he decided to let users comment on Tab For a Cause’s ads. “We’re a fairly transparent company, so we’re really trying to put ourselves out there and directly engage in the negative comments with thoughts about what we’re doing,” Groth said in an interview. The risks paid off: Reddit has been the company’s best advertising platform for user acquisition, Groth said, and it has been getting “better ad rates than we see on Facebook or Google, partly because there’s a little bit less competition on Reddit’s platform right now.”

In the past year, Reddit has ramped up its advertising efforts, specifically through native ads and brand-promoted “Ask Me Anythings,” or AMAs. For native ads, advertisers are able to buy an ad that looks and in many ways acts like a typical Reddit post. Advertisers have their own user account; they can build up “karma points,” a measurement that gauges how a user’s content is received by other users; and they can leave the comment section open so they can interact with other users. Reddit, which arrived later to the advertising game than other social media platforms, has many safety rails in place for ads, such as layered targeting and blacklisting and whitelisting subreddits for the site’s advertisers, said Zubair Jandali, the company’s vice president of brand partnerships. Advertisers are able to target a specific set of subreddits in native ads, or they can work with Reddit to target a group of subreddits based on the type of consumer they’re targeting. In that case, Reddit has both a whitelist and blacklist of subreddits dictating where campaigns can appear. Each ad also goes through several review cycles, with at least two operated by human moderators and others conducted by software tests.

quote-icon If Facebook is people you know talking about things you don’t care about, then Reddit is people you don’t know talking about things you do care about. Zubair Jandali, Reddit vice president of brand partnerships

Jandali said when Reddit talks to brands about advertising on the platform, it emphasizes the site’s 130,000 active communities, each based on a specific topic, which make it easier for a brand to target its key customer base. Reddit targets brands that are keen on “engaging in ways that are unorthodox,” he said, as the idea of brands chatting with potential new customers through an advertisement is still considered atypical. “If Facebook is people you know talking about things you don’t care about, then Reddit is people you don’t know talking about things you do care about,” he said. “For brands, that’s a really highly coveted environment because what brands are ultimately trying to do is align around passion points.” Typically, companies that have a short product life cycle do really well on Reddit, so naturally that includes technology products, Jandali said — however, advertisers have included companies from other industries, such as Toyota Motor Corp.

A majority of Reddit’s advertisers tend to disable the comments in their campaigns, Jandali noted. But those who come to Reddit to engage with users will allow comments, as Audi AG and Hulu LLC’s The Handmaid’s Tale have done before. Reddit’s existing content moderation team will watch conversations in whichever subreddit they appear in; brands are typically more proactively involved in the thread, including its moderation, Jandali said. Advertiser control over the comment thread on its own campaign is still in a “gray area,” Groth said, based on his own experience. If Tab For a Cause staffers sees a comment on their ad that they consider inappropriate, they’re able to flag it for Reddit to take a look at — but they can’t delete it themselves. Currently, the two-person startup team moderates comment threads about once a week in their free time. LiRon Anderson-Bell, an assistant professor of advertising and public relations at Temple University, said in most cases of comment trolling or posting questionable content about the ad, Reddit users will likely downvote inappropriate comments, or the moderation team will remove an out-of-place talking point — but that could change depending on the brand behind the post. Brands need to consider their own personality and the kind of users they are likely to attract before opening up an ad to comments, Anderson-Bell said. For example, she said, “if one of Elon Musk’s brands was serving native ads, the conversation would veer off the rails so fast.” Though advertisers have the option to disable comments, “I think there’s an inauthenticity and disingenuous feel to that” on a site like Reddit, Anderson-Bell said. Advertising on Reddit is “not like putting up a billboard on a highway or even buying a magazine ad,” she said. “Brands have to understand the inherent nature of the platform, so with that comes this expectation that the post content should fall in line with the content that you would find in an organic post.”

The “pretty rudimentary” platform has fewer options for targeting users compared to Facebook and Google, Groth said. But the company is able to go into more detail about its product on Reddit than it can on other platforms given the nature of the native ads, which helps the startup create some of its most engaging ad campaigns. Last week, Reddit said it had updated its targeting tools to increase the accuracy and reach of interest categories. For a few months this summer, Reddit was the top ad spend for Tab For a Cause, which also advertises on Facebook and YouTube. Groth declined to disclose the exact ad rates for Reddit or how much the company spent on the platform. Currently, the company has been increasing its ad spending on Facebook and other platforms as it seeks a different kind of audience, Groth said. However, its ad volume on Reddit still competes with the number of campaigns they have on additional sites. On Facebook and YouTube, the audience appears to spend less time with an advertisement, and Groth said the response from those users feels like “more of a knee-jerk reaction.” “A lot of the time on other platforms, we just say that this is a free, easy way to raise money for charity, and that’s kind of the end of it,” he said. “On Reddit, especially in the comment thread, we’ll have quite a fair amount of details about how much we’ve raised to date and what works.” And the kind of users they get from Reddit are often more loyal to the product, Groth said. “When people do start using us from Reddit, we see that they’re very active users, they’re recruiting their friends, and overall they’re what we’d call ‘power users,’” he said. “By far, it’s the best advertising platform that we’ve been on in terms of what we’re getting for what we pay.”