Digital ad prices are on the rise across the board, with costs rising for virtually every major player, including Meta, Google, Amazon and TikTok. Here, Tag APAC CEO Toby Codrington discusses the various reasons for the increase and how marketers can revamp their budgets to ensure they’re maximizing the value of every marketing dollar.
It’s no industry secret that digital advertising prices are rising. Meta, Google, Amazon and TikTok have all trended higher, while Apple’s ad targeting changes are making it more expensive for marketers to reach the right audience on social platforms.
Why does this happen?
There is no simple answer to why these prices are rising across the board – rather, the increase is the result of a number of factors:
- New ad platforms, like TikTok, experience significant price volatility as demand increases without an established benchmark price
- Apple recently implemented changes to ad targeting and privacy policiesmaking it increasingly difficult (and expensive) to reach audiences on social platforms, including Facebook
- Growing investment in connected TV is pumping more money into YouTube, driving up ad prices
How significant are the price increases?
As the fluctuation continues, The insider reported that Meta’s cost per thousand (CPM) increased 61% year-over-year, reaching an average CPM of $17.60. Meanwhile, TikTok’s CPM increased 185% year-over-year, peaking at an average CPM of $9.40. Google also saw programmatic display CPMs increase 75% year-over-year, while search ad costs per click (CPC) increased 14% year-over-year. Amazon also saw notable CPC growth for its Sponsored Products offering, up 14% year-over-year.
What can I do about this?
As more advertisers continue to shift their marketing dollars to paid social and digital formats, it’s likely we won’t see price stabilization for some time. Rather than settling for less, brand marketers can focus on two adjacent areas where significant savings can be made, which can be used to reinvest in your digital marketing:
1. Creative adaptation
Aside from the CPM or CPC cost of digital advertising, content production can be one of the biggest spending areas of your digital marketing campaigns. Filming new products, editing and producing TVC masters, and hiring talent can quickly add up, which, coupled with rising ad prices, can easily blow your marketing budget.
Instead, adapting existing creatives with new messaging can be a surefire way for brands to cut marketing costs while still creating great content. Consider if you have a TVC where your product can be switched to a new version using CGI, but the remaining content remains the same, or if you can update brand messaging to include a new voice off or a new legend?
Dynamic content optimization lets you make small changes to your content and deliver it to targeted audiences with impact. Whether you want to tweak your tagline or slightly change the targeted product, DCO can produce thousands of iterations of the same asset models using real-time contextualized data, making your message more relevant to your audience.
You might be surprised how quickly and efficiently new creative elements can be created just by making a few small changes to what you already have.
2. Reduce, reuse and reuse
Ask yourself if you can reduce the need for new content by reusing and repurposing what you already have. Don’t fall into the trap of having to come up with a whole new creative idea every week. If your product line stays the same, you likely have creative assets from previous marketing campaigns that didn’t get the attention they deserved.
Dive into analytics from your previous campaigns to understand what worked well, what didn’t, and what could be repurposed. For example, branded marketing campaigns that stand the test of time could simply be reused to reinforce the message. Similarly, product campaigns targeted at a particular audience or demographic could be retargeted to a new audience to ensure you get the most out of your existing assets.
To keep your brand performing at its peak in a turbulent economic landscape, marketers need to stay on top of their marketing activities to ensure every dollar is working for them, whether that’s A/B testing creative assets or CTAs, or by intelligently repurposing content to mitigate the need for new creative output. Working with a qualified production partner can help you identify areas where you can reduce your costs across the marketing ecosystem, ultimately helping you ensure that your marketing campaigns become more effective, more impactful and more effective.