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Buyer of Reddit self-serve ads here, and I think that their approach is interesting, even exciting, and in the long-term potentially very profitable. Some of the issues come down to the ad averse culture (as you pointed out), not just of the community at large but even of the staff on the back-end.

There are great little ideas that are not being managed effectively in my opinion. For instance, it costs more to target a particular subreddit than the whole website, which is not particularly good for the kinds of small businesses that could really benefit from the service (there's also a daily minimum -- $20/day for site-wide, and $30/day for subreddit buys -- compared to Google, and Facebook's $1/day minimum).

Secondly, the true genius of the Reddit ad system is that your ad looks a lot like a regular submission. Think about the power of Adwords -- your ad looks just like the content your potential buyers came to consume anyway.

Thirdly, and here is the double-edged sword -- in the comments, a conversation (actually, a long-term, multiparty conversation) can build around your company. The power of this is truly great; however the implementation has been spotty. Every post on Reddit is submitted via a community with rules, and moderators. The one exception to this is self serve ads. What you end up with is a lot of spam and trolling in your self-serve ad, which defeats the whole purpose of having the comments in the first place.

Unfortunately, in my experience, the admins aren't sure what to say and fallback on free speech adherence, etc. although many posts and comments are taken down in various subreddits due to a lack of observance on the part of the commentor or OP to that sub's rules.

TL;DR: Reddit's self-serve ad system is a billion dollar idea in the making, but only if the culture of the community and more importantly the admins allow it to be so.

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