We are so excited with the progress we made in 2019 and see significant opportunities for our business moving into 2020.
Our teams are well aligned, enabling our business to grow revenue alongside our community through performance improvements on Android and iOS, world-class augmented reality experiences, and engaging made for mobile content.
Over 2019, we generated full-year revenue of $1.7 billion dollars, an increase of 45% year-over-year, compared to 43% in 2018. In Q4 2019, we generated revenue of $561 million, an increase of 44% year-over-year, compared to 36% in Q4 2018. These results are a byproduct of the hard work being done across all teams at Snap, and validate decisions we've made around the structure of our sales teams and the products we have built for our advertisers and our community.
As a result, we believe that we have the opportunity to continue growing annual revenue at a pace significantly faster than our peers.
We are fully focused on making progress against our ARPU opportunity, which we believe in the short to medium term will be largely driven by advertiser demand.
We have significant headroom in our business given our high levels of engagement and ample supply of available impressions globally.
As a result, we are focused on driving demand from advertisers to improve CPMs in our self-serve auction.
Looking at our current ad products and applying comparative industry CPMs to our own inventory, we are in a position to meaningfully close the ARPU gap relative to our peers.
In addition, not only does demand growth increase contestation in our auction, driving up CPMs, but it also increases the number of ads available to choose from for each impression, improving relevance per impression and ultimately yielding higher ROI for our advertising partners, even at increased prices. To achieve our ARPU goals, we remain focused on our three key priorities: First, improving our measurement, ranking, and optimization to drive relevance and deliver ROI.
Second, building out our sales and marketing functions to support the needs of our advertising partners globally.
Third, creating innovative ad experiences around video and augmented reality that deliver real business value.
Our three priorities along with our growing, global audience will allow us to drive performance at scale for businesses around the world.
Our business growth is enabled by our large, growing, unique, and unduplicated audience.
For example, in the U.S., we reach more than 90% of 13 to 24 year-olds and more than 75% of 13 to 34 year-olds.
In addition, our reach is expanding outside of the US as a result of ongoing product improvements that allow us to grow our business and community around the world.
Our community engages with our service for over 30 minutes per day on average, and our advertisers have unparalleled reach with the valuable 13-34 year old demographic that makes up the majority of Millennials and Gen Z.
Our first priority is investing heavily to improve our measurement, ranking, and optimization to drive relevance and deliver ROI.
In 2019, our investments enabled performance advertisers to scale on our platform.
For example, at the start of the quarter, our pixel purchase optimization goal comprised less than 5% of self-serve revenue. Over Black Friday and Cyber Monday, however, this optimization goal that allows advertisers to bid explicitly on a purchase activity on their Web site grew to over 10% of self-serve revenue globally. We enter 2020 with multiple investments in Commerce from the past year ready to scale to new advertisers.
Our self-serve tools, lower-funnel optimization goals, video ad formats, and advanced solutions—such as product catalogs and dynamic ads—work together to reward advertisers who invest in our platform with ROI at scale.
For example, Ralph Lauren started testing Dynamic Ads in October 2019, as product-based ad formats have been amongst the tactics that have worked for their business.
After initial testing proved to be extremely successful, they increased investment by 3x in Q4 2019, during one of the most competitive times of the year for shoppers. This solution not only helped them drive relevance during the holiday period, but they've shared this will be a key performance driver throughout the course of the year.
Our second priority is to grow demand via better service for our advertising partners.
As we continue to scale our advertising business across all geographies, we expect to build out teams in different verticals to support our rapidly growing ad business. This includes building a Global Partners team to work with our largest global advertisers to create seamless global planning, hiring more sales operations experts to continue to improve operational rigor in our sales teams and pipeline planning, and generally mature the ways our sales organization operates as we scale over the coming years.
We're encouraged by the early success with many of our verticals, most notably Tech, Restaurants, Entertainment, and CPG.
For example, PepsiCo's Mountain Dew looked to Snapchat to leverage our innovative ad products and drive sales for the Mountain Dew brand. Snapchat worked with Mountain Dew to run two campaigns for their DEWnited and VooDEW product lines. The DEWnited campaign leveraged Snap Ads and Filters to highlight the classic Mountain Dew logo, and helped drive incremental sales returns above PepsiCo norms primarily through a lift in household penetration. The VooDEW campaign leveraged Snap Ads and Lenses to target Halloween fans and candy buyers, which resulted in a significant lift in ad awareness and brand favorability for Mountain Dew's limited-time VooDEW product.
Our third priority is to continue to lead the way with innovative advertising products and services.
As brands focus more on incremental reach and depth of engagement, rather than just clicks and impressions, more advertisers are employing innovative formats that drive real customer interactions. Snap is the ideal place for these brands, because our advertising products are built on the same foundation that makes our engaging consumer products successful.
We continue to invest heavily in innovative solutions that leverage our content and augmented reality platforms in order to drive better outcomes for advertisers and delight our Snapchat community.
Video is a top priority.
For example, we started to scale Commercials—our six-second, non-skippable, full-screen video format—and Snap Select, which enables fixed CPM buying of Commercials in prepackaged, premium inventory. Combining this engaging ad format and easy-to-buy model within premium content placements has seen early success with high quality brands. Recently, we rolled out the capability for Snapchatters to engage more deeply with our Commercials product, and have already seen success stories.
For Black Friday 2019, GOAT, the global platform for style, featured a week-long Black Friday raffle that included over 3,000 prizes, 35,000 sneakers and $10,000 in GOAT credit. They ran a Commercials campaign that swiped up to the promotion landing page which lead users to download the app. Snap accounted for 95% of all traffic to that landing page, and GOAT saw a cost per install of just 20 cents from Snapchatters downloading their app to participate in the Black Friday raffle. Amanda Sun, Senior User Acquisition Manager, said, "We'll continue to leverage Commercials annually with our Black Friday raffle, as well as with other similar campaigns to not only broaden awareness but to reach a highly engaged audience."
Long-term brand building on mobile remains a challenge for marketers and no one is better positioned to deliver solutions than Snap.
We have a huge opportunity with our camera-first functionality and our Sponsored AR Lens formats.
We are at the beginning of building out our AR ecosystem for brands and providing additional value beyond paid media.
For example, this quarter we announced that McDonald's and Coca-Cola are the first brand partners to utilize our Scan camera search technology.
Our Scan feature combines visual search and augmented reality by recognizing images through the Snap camera and providing AR lenses related to what the camera is focused on—in this case, the well-known logos of McDonald's and Coca-Cola. These initiatives complement our existing marketing campaigns and link digital content to the physical world.
Any brand can now utilize our Scan technology for free via Lens Studio, our public AR creation tool, and submit it to the Snapchat community.
Turning physical products that are a part of Snapchatters' everyday lives into conversation starters through immersive AR is a unique way to connect with our audience and an important milestone for this technology. We believe we are poised to continue growing advertiser adoption of AR ad formats as augmented reality marketing becomes more widely adopted by businesses.
We are also seeing that when brands utilize a portfolio approach of combining Sponsored Augmented Reality Lenses with Snap Ads, they result in stronger ROI and lower costs per outcome. This is leading to brands deepening their investment with Snap over time.
For example, our partnership with MGM Resorts International started with brand-focused campaigns, including a Lens in Q4 2018 to launch their new Park MGM hotel in Las Vegas. This drove a 10pt lift in Ad Awareness and a 5pt lift in Consideration Intent.
Given the upper funnel success they saw, they implemented the Snap Pixel and expanded into running direct response efforts to drive room bookings across their entire portfolio of properties using Snap Ads, Story Ads, and Collection Ads. These generated an 18x blended ROAS across all ad units. Most recently they came full circle by combining the best of their direct response learnings with Snapchat's augmented reality opportunity by applying AR for direct response to drive Park MGM and expanded portfolio bookings in Q3 2019. This activation drove ROAS in-line with direct response-focused Story Ads and Snap Ads units, proving augmented reality is an effective tactic for achieving cost-efficient room bookings. We enter 2020 with a full-featured ad platform and a sales team structured to support our business.
Looking forward, our strategy for growth is to continue to invest in new products and marketplace improvements to help advertisers scale, build focused relationships with brands and agencies across 8 many of our verticals, and to improve our direct response products for performance-centric businesses. Based on the size of our audience, their levels of engagement across camera, content, and communication, and our overall opportunity in the growing digital advertising market, we are in a position to meaningfully close the ARPU gap relative to our peers.
Our team is incredibly excited about what the future holds for Snap and we look forward to growing and building deep relationships with our partners over the longer term.
With that, I'll turn the call over to Derek.