• Gabrielle Gillespie

Ho, Ho, Ho - Hold Up! Why Are My Ad Costs So High?

Chestnuts may be roasting on an open fire, sleigh bells may be jingling, and the snow may be glistening. However, it is certainly NOT the most wonderful time of the year for some online advertisers.



Why? Because ad prices are known to skyrocket during holiday season. No, really… Worldwide spend on social media advertising was up 50.3% at the peak of the 2020 holiday season compared with the same period the year prior, according to the latest quarterly report based on Socialbakers' platform data. Holy tinsel!


So, why on earth does it get so expensive? Well, a couple of reasons:


1) Increased Competition


When are consumers most likely to buy? Holiday season. And how are they shopping? Online! So, like any good marketer or advertiser, your competition wants to appear when your target audience is most likely to purchase, and where your audience is likely to be. And, as mentioned, social media is the most popular way for small and medium-sized businesses to advertise during the holiday season, per a survey by location-based marketing firm Reveal Mobile. In fact, the study found that more than a third (36.4%) of advertisers will allocate the majority of their holiday ad budgets to social media, followed by email marketing (15.2%), TV (14.7%) and print (14%).


In other words, you’re competing with a ton of brands, both big and small, in the most highly competitive time and space.


2) Higher CPC (Cost-Per-Click)


More competition means that you’ll inevitably be paying more per click. Let’s face it: Google, Facebook, Twitter, YouTube, SnapChat, and other platforms are in the business of profit. They want to capitalize on the holidays just like you do. With the increased demand for ad space, it’s only natural that the bidding war begins. So get ready to pay more per click!



But, there’s something crucial to consider!


Despite the increase in competition and investment, the holidays are a great opportunity to maximize on the best buying season of the year. Sure, advertising costs are bound to increase, but ROAS will as well. Marketer Neil Patel found that ad impressions typically increase 50% during the holiday season. Click-through rates rise 100%, direct traffic increases 150%, the average order value grows by 30%, and conversion rates go up 60%. Now THAT is a winter wonderland!


So, now you know why it’s more expensive but you’re still eager and ready to compete with the big brands to get those results. If you aren’t sure where to start or how to optimize your ads for the season, deep breaths!


We’ve got some tips:


1) Narrow Your Audience


Santa Claus didn’t choose just any reindeer to carry his sleigh, so you shouldn’t choose just any audience for your holiday campaigns!


As costs will be higher, the holidays are a good time to really narrow down your audience and target those who are most likely to purchase. If you’re going to pay more per click, why not try to get the best ROI possible?


Hone in on your audience. Is there a certain demographic more likely to buy? Do you have a warm audience ready to close? Don’t forget about geographic locations, the time your ad is showing, and other factors that affect conversion rate.


2) Holly, Jolly Content


As people scroll through infinite holiday ads, how can you get their thumb to stop on yours? With better content!


Engaging content such as video, graphics/memes, carousel ads, influencer content, and founder stories are a great way to break through to your audience. Also, take the time to look at your messaging and consider testing different variations. This holiday season, price-related messaging and different offers are going to be very enticing as people look to save on their holiday spending. By testing out your messages you can quickly optimize for those offers that get more traction.


3) Create a Seamless Experience


You want to give your audience an ideal purchasing experience. They’re more likely to drop off if they encounter a roadblock of any sort. So, make sure your links work, that audiences are able to “check out as a guest” if possible, and don’t force them to purchase from the social networks only. When applicable, create a corresponding landing page (with a tracking Pixel!) on your website to link in the ads.


4) Promote Gift Ideas or Bundles


If there’s one thing people need during the holiday season, it’s gift ideas. Consider using a carousel ad to promote different gift ideas or bundles. This tactic also helps to increase average order size and compliments what’s going on in Q4 nicely – people are spending more, both on themselves and others. How can you package your products together to create an easy, yet thoughtful, gift for your customers to purchase?

Here are some ways to increase average order size:

  • Bundling products

  • Offering extra features for a discount

  • $-off discounts (“spend $X, get $ off” offers)

  • Gift with purchase


This may seem like a lot to digest, but don’t let the craziness of Q4 overwhelm you or sleigh you down (ha, ha - get it?). Utilizing social ads is one of the best holiday marketing tips we can gift you this season.

But, if social advertising stresses you out or you have no clue where to start, we can take it off your plate with our new #AdsOnly service! Reach out to us to get started today.

Happy Holidays, marketers!


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