Digital Marketing Snapshot
2021 Fourth Quarter Spending Growth Reflects Impact of Pandemic on 2020
While the overall number of ads seen by consumers did not expand, brands were more competitive across ad prices, pushing overall investment higher than the extraordinary spike of one year ago.
WHAT YOU NEED TO KNOW
Year-over-year spending increases in Q4 were more modest compared to the extraordinary growth from that period in 2020.
Price increases played the largest role in spending growth for paid social advertising, followed by paid search and then retail media, where click volume contributed nearly as much.
While direct response objectives still dominate, campaigns that are focused more on branding are growing the fastest across Facebook.
Search campaigns that optimized for Cost Per Action (CPA) were a key driver of overall search growth, with spending increasing 65% year-over-year and CPC rising by 52%.
GROWTH SLOWS BUT CONTINUES IN Q4
Year-over-year spending increases in Q4 were more modest compared to the extraordinary growth from that period in 2020.
AD PRICES FACTOR INTO SPENDING INCREASES
Price increases played the largest role in spending growth for paid social advertising, followed by paid search and then retail media, where click volume contributed nearly as much.
SOCIAL ADS EXPAND ACROSS CONVERSION FUNNEL
While direct response objectives still dominate, campaigns that are focused more on branding are growing the fastest across Facebook.
SEARCH ADVERTISERS ZERO IN ON CONVERSION METRICS
Search campaigns that optimized for Cost Per Action (CPA) were a key driver of overall search growth, with spending increasing 65% year-over-year and CPC rising by 52%.
FOCUS ON COMMERCE
HOLIDAY 2021
"Commerce advertisers" are any advertisers promoting the sale of physical goods. Ad spending for this segment increased for the holiday season, with paid search showing the most robust growth over last year.
COMMERCE SPENDING GROWTH
Annual growth and unit pricing increases for commerce advertisers was remarkably consistent across channels.
SHOPPING AD SHARE
The share of spending from shopping ads for commerce advertisers picked up from Q3 in both paid search and paid social, but was lower than Q4 last year in both cases.
CORE TRENDS
Search Trends
Seasonality helped drive spending up across paid search compared to last quarter
Non-commerce advertisers and increasing CPCs were a key factor in overall expenditures rising 23% over last year.
Impressions
QoQ
+39%
YoY
+1%
Clicks
QoQ
+30%
YoY
0%
Spending
QoQ
+28%
YoY
+23%
CTR
QoQ
-6%
YoY
0%
CPC
QoQ
-1%
YoY
+23%
Retail Media Trends
Spending growth on retail media came back down to earth after occupying the stratosphere for most of 2020.
Impressions shrank year-over-year, possibly hinting at changes in online shopping behavior in the face of inflationary and supply chain pressures.
Impressions
QoQ
+23%
YoY
-8%
Clicks
QoQ
+23%
YoY
+9%
Spending
QoQ
+29%
YoY
+23%
CTR
QoQ
0%
YoY
+17%
CPC
QoQ
+4%
YoY
+13%
Social Trends