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BizReport : Social Marketing : November 18, 2019

Expert: How to use social to increase holiday conversions

With just over a week until Thanksgiving and the official kick-off to the holiday buying season, there is still time for merchants to make final tweaks to maximize holiday revenue. Especially on the social front. Here's how:

by Kristina Knight

Kristina: How do major shopping holidays affect CPM rates?

Andreas Stenman, Head of Industry - eCommerce and Disruptors: During major shopping holidays, competition for ad space on social media is at an all-time high, which drives up the cost of CPMs. In fact, based on aggregated global data of all customers, found that Black Friday has the largest impact on how much marketers will pay for their social media ad campaigns. On average, buyers can expect to see an increase of about 50 percent on Black Friday itself, and 38 percent on Cyber Monday.

Though these days will require a large chunk of the overall ad budget, marketers should plan for higher spend in the days leading up to and after those dates as well. Last year, social CPMs were seven percent higher than normal two days before Black Friday, and 19 percent more expensive on Thanksgiving Day. With that, CPM surges during Saturday and Sunday of Black Friday weekend hit 33 percent and 32 percent respectively.

Kristina: What opportunities does this allow for marketing teams around the holidays?

Andreas: For advertisers looking to compete in the crowded holiday ad marketplace, there is a huge opportunity to capitalize on the fact that consumers are ready to shop. There's a reason competition (and CPM pricing) is so high. That said, advertisers hoping to take advantage of consumers with a higher purchase intent than normal should ensure they have a sound strategy in place that encompasses creative, optimization and collaboration at scale. Marketers need to be especially agile during this time of year, optimizing in real-time to ensure that the money spent on CPMs is strategic and effective.

To get the best ROAS possible, it's important to focus on making a consumer's path to purchase as simple as possible by combining engaging copy with compelling creative. Marketers need to make sure that they take consumer browsing and shopping habits into account by launching ad campaigns in the platforms they use most, using the formats they prefer -- this might even include in-app purchasing options. What your ad looks like and how it functions significantly impact whether or not consumers engage with the content.

Kristina: How has social advertising evolved in the past couple of years?

Andreas: Social advertising 5 years ago looked nothing like it does today, and the social advertising of the future will likely be unrecognizable. Most recently the emergence of story and shoppable ads has created new applications, where marketers can provide a more immersive and seamless experience for consumers. For example, Facebook, Instagram and Snapchat stories have changed the way people consume content and thereby opened up new revenue streams for marketers. Likewise, with shoppable ads, consumers are more willing to buy products in-app now. And in a visual-first world, the appetite for high-quality creative in advertising has skyrocketed. Consumers expect an advertisement to fit seamlessly into their newsfeed and stories, matching the quality of content that their friends and favorite influencers provide.

Kristina: How has the role of creative changed social advertising?

Andreas: Social platforms, especially Facebook, have changed dramatically during the past few years. For one, delivery algorithms have gotten better at finding potential clients, which means that, for most businesses, there is less of a need for granular targeting and manual optimization. As a result, we are seeing that creatives are quickly turning into the most important performance lever for social advertising campaigns.

Creative can no longer be a long, drawn-out process, with multiple reviews and iterations. Creative must be quick and agile, matching the needs of the consumer no matter where or when. It is crucial for advertisers to have tools in place that make it possible for creative teams to design specifically for the social channels, to understand what is driving performance and to make quick iterations based on the learnings. With these insights, advertisers will truly see the "best-kept secrets to performance" and understand how crucial it is for creative and performance teams to work more closely together than ever before.

Kristina: What should marketing teams anticipate this season when budgeting for social advertising?

Andreas: Based on our analysis, we expect that Black Friday will build upon the increases we saw in 2018 and continue to drive up social CPMs significantly in peak shopping periods. When budgeting and setting bids this holiday season, marketers should be prepared for CPMs to start rising one day prior to Black Friday, potentially at a 15 percent index. And since many advertisers start bidding higher before Black Friday and continue to do this throughout the weekend, it's important to make sure that the campaigns are launched and ads are approved before Black Friday. We expect CPMs to once again peak on Black Friday itself at about 45 percent, which will be the highest spend for social advertisers all year. To wrap up the weekend, predicts social CPMs will drop slightly to the 30 percent range during Black Friday weekend, before once again increasing on Cyber Monday.

Tags: 2019 holiday shopping, advertising, CPM rates, ecommerce, ecommerce trends,, social commerce, social marketing

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