Fighting spiking CPAs during the holidays (and beyond)

2020 has been a whirlwind, but that doesn’t mean Q4, the holiday season, or Black Friday and Cyber Monday will cease to exist. As the holiday season grows nearer, children begin to look to the skies to get a glimpse of their favorite jolly man adorned in red, while eCommerce marketers tend to look in a similar direction for the impending rise in advertising costs.

It probably comes with very little shock when I say that advertising costs continue to creep further and further north the closer we get to Q4 — especially Black Friday and Cyber Monday. 

The Holiday Growth Will Only Continue 

Online retailers know they must pull all the stops in order to win this lucrative time of year. And why shouldn’t they? Online shopping has seen tremendous growth over the past few years with no signs of slowing down. We saw $126.4 billion spent online in 2018, and Deloitte’s annual holiday forecasting predicted that sales would increase between 14% – 18% (that’s $144 billion – $149 billion for those keeping count) during the 2019 holiday season!

Of course, 2020 threw us for a loop with eCommerce spend in April and May surpassing November and December of last year!

It’s still very likely that Black Friday and Cyber Monday will take center stage as the most important time for online holiday shopping — with Cyber Monday seeing an enormous 19.3% increase to $7.9 billion in 2018 according to Adobe Analytics. One-third of shoppers report that holiday weekend purchases were driven by promotions. It’s no wonder that so many brands are vying for consumers’ attention online. 

But with such fierce competition comes an unfortunate downside: bid prices can increase up to 140% during the holidays!

Bidding Wars and the Unavoidable Cost Spike

Most marketers are very aware of this — anyone who has looked at CPM and CPC costs during this time has had to swallow a proverbial lump of coal. In fact, this concern topped the list in a recent study conducted by Shopify with 80% saying rising ad-spend is a top pain-point for the holidays.

Everyone wants to get the best deal, but if everyone tries to buy at the same time, costs go up. Just how big of an increase could you expect? Alarmingly, CPCs and CPMs increased 90% and 21% year over year since Q2 2018 — for a marketer this feels more like a Halloween fueled nightmare than a Holiday miracle!

There are some trends you can watch out for to help you effectively combat costs IE:

  • The first two weeks of November and the last few days of December typically have the lowest CPMs, or
  • Historically CPMs can rise 30%-40% from December 8th to December 25th

Some predictions across the board forecast that eCommerce holiday spend and promotions in 2020 will extend beyond the normal Black Friday / Cyber Monday timeline. Meaning… we could potentially see an extended period with even higher costs as there’s more competition online than ever before. 

The truth of the matter is that your advertising costs will always vary depending on a number of different factors. For example, buying ads on Facebook is more akin to an auction than a guaranteed bet, with several variables playing a part in shifting costs:

  • Timing – The day, month, and even hour you show your ad
  • Placement – Where you choose to showcase your ad
  • Audience – Competition for similar audiences and the size
  • Bidding Strategy – Whether you are bidding for low cost or bidding caps

Those are just some of the factors smart marketers must take into consideration when building their advertising strategies. 

Advertising is all about the ROI. As such your goal as a marketer is to defend that ROI which is increasingly difficult with the rising costs — especially when trying to figure out what that extra somethin’ is to allow you to inch ahead of the competition. We feel that pain — it’s something many of the brands speak to when we asked what their common pain points were. 

The top three complaints we hear are:

  • “Ads worked great, but my CPC is through the roof!
  • Wasted a ton of money on advertising, got a bunch of clicks, but only a few sales.”
  • “Paid a lot of money for clicks that seemed like fraud.”

After listening to these complaints, we set out to tackle this issue that – frankly happens year-round! It was time someone shook up the traditional model that we, as marketers, have grown accustomed to, so we began asking questions.

  • What if there were no CPM or CPC?
  • What if you could guarantee your ROAS?
  • What if you could eliminate ad-fraud?

So What Can You Do?

We may be slightly biased, but we want to tell you why it’s so important that you take control of your ad-spend. Don’t get us wrong, the standard channels still perform extremely well — you’d be hard-pressed to find a merchant who isn’t using the likes of Facebook or AdWords (and rightfully so!) But as the competition becomes ravenous, what else can a merchant do to creep ahead without spending an arm and a leg? Enter, Klickly.

Klickly is the first-ever 100% commission-based advertising platform. 

We believe an advertising platform should be aligned with the brand. It should have all the qualities of a performance-based model brands love –– you only pay when they drive sales –– BUT while actively advertising your products on limitless sites. And that’s what we’ve aimed to do with Klickly –– as a smart marketer you can grow your brand’s audience in a risk-free way (no up-front spend), and pay only when you drive sales.

Our goal was to make the most brand-friendly advertising platform out there. By addressing those previously mentioned pain points, we created a platform that allows brands to eliminate CPCs and CPMs all-together while giving them the flexibility to pay within margins that makes sense for them. Besides, no two brands are alike! With Klickly you: 

  1. Launch a campaign in 15 minutes – simple 3 step process without touching any code
  2. Choose your own commission – that’s right you tell us what you want to pay
  3. Let our machine-learning algorithm optimize – take out the guess-work and bidding process completely

Conclusion

While there are certainly hundreds of helpful articles that will give you effective strategies to navigate and combat the extreme holiday spike, we recommend you ask yourself the “next step” question: what’s that extra thing I can do that will help push me ahead of the competition without breaking the bank? While there are a lot of options out there to help give you that extra push, we recommend something that eliminates CPCs and CPMs completely. 

Whatever you choose, we hope you’re able to effectively fight those CPMs for what’s shaping up to be an unprecedented Q4 2020! 


About Klickly:

For those who are new to Klickly, we are an invite-only 100% commission-based advertising platform that allows eCommerce merchants to lock in their returns by choosing their own commission. Klickly, then, advertises your products across 25Million+ premium online destinations (like the open web, apps, games, etc) only charging when we help make a sale.