How to Gain a Competitive Edge in Today’s Landscape
Strategies to Help Your Digital Dollars Go Further
Combat rising CPM and CPC costs with these tools. In this blog post we share how you can take your digital dollars further.
Rising cost-per-click (CPC) and cost-per-mille (CPM) rates represent one of the toughest challenges for marketing teams. Advertisers must develop a commerce-first mindset to stand out amid the staunch competition as established brands increasingly move their sizable budgets online. Supply chain restrictions and related effects of the COVID-19 pandemic have further encouraged the push to e-commerce and the constant evolution of the customer acquisition and conversion journey.
Understanding these hurdles can help your brand the competitive edge you need to survive and thrive in the ever-changing digital landscape.
Breaking down increased costs
You feel the pinch of skyrocketing CPM and CPC costs when you review your budget. But how much have these rates actually changed in recent years? Here's what we found about the average price changes on the most popular platforms and social sites:
- Amazon advertisers paid an average CPC of $0.85 in 2020, which increased by about 50% to $1.20 CPC by June 2021. Customer acquisition costs on the platform rose from 15% to well above 20% over the same period (Marketplace Pulse).
- Google's CPC increases by an average of 5 to 12% every year. Based on an average reported CPC of $1.16 in 2018, 2021 costs are closer to $1.63 (Forbes).
- The average Instagram CPM increased by 104% from $7.79 in April 2020 to $15.92 in May 2021. (Belardi Wong).
- For Facebook, CPM average costs increased by about 30% from March 2020 to March 2021. (Ad Exchanger).
Driving real results with smart strategies
Don't be alarmed by those numbers—with the right toolkit, you can rise above rising CPC costs and make your digital dollars go further. Start with these tips.
Rethink what you're advertising and why
While the idea of reviewing and revitalizing your product offerings isn't exactly revolutionary, it's important to analyze your online catalog through the lens of your expected digital return on investment. Our clients tend to find more success by focusing on a few high-quality products that drive impressive ROI rather than an extensive selection of lower-cost items that result in smaller returns.
In the latter scenario, you may be spending more on ads than you receive in profit. We recommend shifting your digital marketing dollars to a few tried-and-true products you can count on to boost your bottom line. Look at each product's profit margin individually to see how (and if) it contributes to your business goals.
Leverage first-party data
Collecting and using direct data from your prospective and current customers ensures efficient use of your advertising budget, preventing you from wasting money on targeting those who are unlikely to result in conversions. Traditionally, brands relied on third-party methods like cookie tracking to gather valuable details about their prospects, but the passage of the so-called Cookie Law in 2011 gave browsers the opportunity to stop marketers from collecting these tiny but valuable bytes.
Today, first-party data is the most effective way to segment your audience based on desired characteristics and increase or decrease spending accordingly. Your business owns this proprietary information, which gives you an edge over affinity audience targeting tools available on Facebook, Google, and other social sites.
Personalize every campaign
Now that you have all that first-party data, how can you best use it to overcome cost challenges? The most efficient spending comes from connecting with your intended prospects in new ways. For example, try geotagged coupons that appear when potential customers approach your store. If you target a global population, you can experiment with ads in languages other than English for certain prospects.
No matter your approach, creating targeted campaigns for each segment improves your Google quality score, which lowers your CPC. In a survey conducted by the search engine, 90% of marketers said that ad personalization has a significant positive effect on profits, and 61% of customers said they expect this type of targeting from the brands they favor.
The Code3 difference
We've developed a proprietary business intelligence tool, Code3 Insights, that helps our clients consider the entire user journey from awareness to purchase. Despite the importance of developing strong data, it's not only about tech. The people and processes make the difference for Code3 clients, helping you seamlessly realize your intended outcomes. With the winning combination of a remarkable team and smart strategies, we can help your brand evolve in real-time and respond effortlessly to changes in the e-commerce landscape.
The bottom line? Don't let rising CPM costs affect yours. Connect with Code3 today to leverage decades of experience from our digital natives. We're ready to help your company conquer challenges,remain ahead of the curve, and help your digital dollars go further.
SIGN UP FOR OUR WEEKLY NEWSLETTER
News, Views, and Valuable Resources
Delivered to Your Inbox Each Week