What to Do When Digital Advertising Gets Expensive

Digital ads have become a popular way for brands to reach their people and you might have noticed prices rising. While the internet can feel like an endless expanse, there are only so many placements available and price increases with demand. If you want to break through during competitive periods, you need a great digital advertising strategy.

Google and Meta’s ad prices are set based on an auction. The more bidders there are for ad placements, the higher the cost-per-click or cost-per-impression will be. You might have noticed ad prices increasing during competitive periods, like Black Friday or Christmas. That’s because there are more advertisers trying to reach the same audiences as you.

The price you need to pay for an advertising placement is also influenced by the quality of your ad. If you have a highly relevant ad, the advertising platform might give it some preference and your audience will convert more easily. As a result, your costs will go down. 

So, if you’ve noticed that your budget isn’t stretching as far as it used to, it could be because demand for your advertising platforms has increased or the quality of your ads has declined. 

It’s important to monitor the amount you spend on digital advertising because high customer acquisition costs can impact your business's profitability. Plus, the last thing we want is to exhaust our budget too soon and miss out on valuable opportunities to reach our customers.

Let’s dive into some steps you can take to make the most of your digital marketing budget when the competition heats up.

Review your performance often.

Keeping track of high-performing ads helps you shift your budget from low-performing campaigns to more profitable ones. It also helps you to stay in tune with the market. Demand can fluctuate frequently and you want to ride the ebb and flow. If you see your conversion rate taking off in a particular campaign, then you can consider giving it more budget. Running AI-led and manual campaigns side by side also gives you more visibility over performance.

Rather than setting a fixed monthly budget, also think about increasing your spending when you know that customer demand and competition will be strong. Map out your big events for the year, such as Valentine's Day, Christmas, and Cyber Weekend, and make sure you’re ready to spend on advertising to boost your visibility.

If you don’t have a huge budget to spend, then focus your activity on niche segments. People usually have to see ads multiple times before taking action and focusing your campaigns on a niche market will increase their exposure.

Diversify your channel mix.

It’s good for your audience to see your brand across multiple platforms. Each platform also offers opportunities to target people at different phases in their purchase journey. By diversifying your channel mix, you can reach your audience from multiple angles.

Different platforms can also offer different prices. Why not set up a Pinterest campaign if the cost per impression is low and you know your audience likes to spend time there? Pinterest campaigns help to reach people when they are in ‘discovery’ and ‘planning’ mode and are a strong complement to search ads. 

Google Search has been the preferred online search engine by many people for years. However, some people’s search habits have changed. For example, TikTok is now a popular search engine for Gen Z. It’s important to keep track of these changes and be discoverable on a diverse mix of channels that your audience likes to use. 

When you know what works across each platform, it’s also easier to shift your budget between channels to enhance performance. 

Create a great experience for your customers.

The better your ad is, the more influence it will have on your customer. That’s why you should keep tabs on your best-performing ads. What ad copy and creative generates the most conversions? Do you need to show different styles of ads to different audiences? Can you produce more of what resonates?

Before you start paying for traffic, you also need to make sure that your website and landing page offer a great experience. Monitor what happens after people click on your ad and your webpage. Are people moving seamlessly through your website to make a purchase or sign up? Or, are they hitting roadblocks and leaving?

If you’re paying a lot of money for ads that aren’t converting, then a website update could be one of the best investments you make.

Rise with the tide.

A budget gives you options. A test-and-learn approach also helps you use it wisely. If you gather learnings from your campaigns you’ll become more adaptive to market changes and more sure of how to allocate your budget when the competition heats up.