More marketers looking to reach more consumers doing shopping and research online has meant spending more money on what programmatic ad inventory is available.
But that doesn’t mean the brands who count the holiday seasons among the most important on their marketing calendars are resigned to paying inflated CPMs.
According to analysis from programmatic company MiQ, demand for programmatic ad inventory increases among marketers in order to reach the most relevant audiences during the important holiday season. Unsurprisingly, this leads to an increase in inventory and CPM costs, generally between 12% and 18% compared to the rest of the year, on average.
In Canada, there is actually an increase in average CPM cost that begins in late summer leading up to back-to-school, before dipping down slightly in late September and beginning to rise up again right around Halloween. CPM costs actually hit a high mark in early- to mid-November, partially priming the market ahead of when Black Friday and Cyber Monday sales hit, but also responding to consumers beginning their holiday shopping earlier. It’s a change in behaviour that has been part of what has led to Canada having the most variance in average CPM costs compared to other countries tracked by MiQ.
CPM costs then dip slightly before reaching their highest point near the end of the year in anticipation of last-minute shoppers and Boxing Day. MiQ says average CPA costs have gone up between 3% and 8% during Christmas week, despite user engagement being only marginally higher.
Those CPA costs are higher closer to retail events, and MiQ’s analysis finds that the overall CPA performance during Q4 is similar or only slightly better compared to the average for the second half of the year.
Looking at normalized CPA levels from the last three years, MiQ found the optimal CPAs actually come in July, before crossing into “higher than normal” levels in late August. And while CPA levels stay in that range for the rest of the year, MiQ says the levels are still more desirable in October and early November than they are closer to big sale events.
With that in mind, MiQ recommends that marketers looking to get the most out of their programmatic investment starts early and maintain a balance between mass reach and performance: run branding campaigns in September and October and transition into more targeted actions by November and maintain it into December, avoiding the “last-minute rush” on programmatic inventory that comes Christmas week.
The other way marketers and buyers can manage budgets is by examining what channels they’re investing in. Not surprisingly, online formats were the most popular types of ads for Canadians to get information about holiday deals, with 46% citing online ads and 39% citing online shopping platforms as key research sources. In addition, 46% say they get information from promotional emails from brands.
However, those aren’t too far ahead of traditional channels. In Canada, 35% say they get information about holiday offers and sales from TV ads, with 33% citing print ads. Only 22% said that got that info from social media ads.
