Q4 is different to the rest of the year. This is for a number of reasons, which we’ll explore further below, but most important is to be aware of the changes, and ensure that your organization is strategically positioned as Q4 rolls around.
Advertising revenue consistently spikes over Q4. When it comes to media costs, we want to make sure you’re getting the “bang for your buck” you deserve.
Don’t Underestimate Q4
Research has shown that CPC rates peak in November and December, often by well over 10% over prior months. CPM rates have been shown to have increased quarter-on-quarter by over 40% for Q4.
Why is this? A number of factors contribute to higher media costs over this period. The simplest is supply and demand. As demand for goods and services – and by extension ads – skyrockets over the holiday season, prices are driven up across the board.
Other factors are at play too. For example, many larger corporations have budget space left at the end of the year. By not deploying their entire media spend, they run the risk of reduced budgets going forward and will ensure that every last dollar is spent before the year is up. This drives up bidding as the year is coming to a close.
Q4 And Media Costs
Sheryl Sandberg is quoted as saying that for Facebook specifically, Q4 ad costs increased by 43%. This is similar to what happens across the board, from Google to Snapchat and everything in between.
With the increased competition, companies’ regular strategies will not be effective over this period. Just leaving your media costs on “autopilot” will end up squandering precious resources, without much more to show for the efforts.
The key is to ensure that everything is set up specifically for this Q4 period.
A great analogy is taken from the Californian water management effort when the state was experiencing severe drought conditions. Instead of focusing on water catchment areas, they focused on clearing the channels that led from mountainous areas to these catchment areas.
The results were beyond expectations. Any small amount of rainfall flowed straight through to the dams. This lesson can be applied to Q4 media costs. First, before spending a dollar, ensure that everything else is completely optimized for this time of year. Consistency has to flow through the entire process – from the ad, through to app store page (or landing page), ensuring that the same message is present throughout.
Think strategically about everything, including when and where to run campaigns (shopping habits differ, especially over the holiday season). With the correct overall strategy in place, your results can be as good – if not better – than the rest of the year.