Digital Media Costs Continue to Rise in 2022
Digital ad spending has surged since the start of the pandemic and, despite fears of an impending recession,1 is expected to grow throughout the remainder of 2022. With the correlated increased demand and stagnant inventory on ad platforms, digital media costs have gradually risen.
As more brands invest their media spend in ad platforms such as Meta, large tech companies like Apple, Google and Amazon are prioritizing consumer privacy and tracking transparency with the introduction of iOS 14.5 and removing third-party cookies. The deprecation of cookies allows consumers to opt out of app tracking and mask IP addresses to eliminate IP address-based targeting.
The convergence of these factors over the past few years has made it more difficult to target quality consumers on platforms such as Meta and Google. The heightened hurdles and resulting cost increases are forcing advertisers to question the long-term value of digital advertising, specifically within walled garden platforms.
To account for these rising costs, Backbone’s media team continues to develop strategies to counter-balance the rising platform costs.
Facebook Best Practices
Meta continues to encourage consolidation across the campaign, ad set and ad level to allow their algorithm more room to optimize along with suggesting 6+ ad placements, utilizing motion assets and less frequent campaign edits to stay out of the learning phase. By following these suggestions, we have seen more cost-efficient CPMs and CPCs within the platform.
Pair a conversion-oriented prospecting campaign with a traffic-driving campaign to balance costs within awareness tactics.
Diversifying Media Spends
Test alternative social platforms (e.g., Pinterest, Reddit, TikTok, Snapchat) and brand media tactics (e.g., audio, CTV) that are quickly gaining market share with competitive costs to Meta, specifically when looking to introduce new consumers to a brand.
To drive the most efficient results, implement recommended platform updates such as Enhanced Conversions and Performance Max. As strategies shift with these updates, we have seen Performance Max drive more traffic to the site at a similar cost to what we’ve historically seen with Smart Shopping.
Leverage up-to-date first-party data across paid social and paid search efforts to more accurately target past purchasers as pixel-oriented data has become less reliable as a result of iOS14.5.
The paid media landscape is facing multiple challenges, including increased demand with stagnant inventory, privacy changes, and a potential recession, which have all contributed to increased digital media costs. By remaining nimble with media strategies, brands will be able to capitalize on opportunities within digital media channels to capture the evolving consumer demand moving into Q3 and Q4.
This report on 2021 media trends from Backbone’s media team is part of a series of updates that provide data-driven insights and experience-based anecdotes. If you have feedback or questions, please send us a note at email@example.com.