Digital Marketing Snapshot

Key digital ad channels served more ads at lower prices in Q4, driving overall spending growth higher

Strategy, diversification, competition and the economy all may have helped drive aggregate prices down
WHAT YOU NEED TO KNOW
FOCUS ON COMMERCE
CORE TRENDS
WHAT YOU NEED TO KNOW
The number of ads and ad interactions measured by impressions and clicks, respectively, grew at a healthy pace in Q4
Advertisers were more likely to see lower YoY ad prices in Q4 than higher prices, compared to last year across channels, particularly paid social advertisers
2021 saw the highest Q4 year-over-year (YoY) CPM growth in five years, which may have set the stage for a big drop in 2022 even without the additional impact of other factors
Spending increased over Q4 of last year in all channels, but lower ad prices have meant lower growth rates than previous quarters
AD VOLUME GROWS ACROSS CHANNELS
The number of ads and ad interactions measured by impressions and clicks, respectively, grew at a healthy pace in Q4
MOST ADVERTISERS SAW LOWER AD PRICES
Advertisers were more likely to see lower YoY ad prices in Q4 than higher prices, compared to last year across channels, particularly paid social advertisers
A BRIEF HISTORY OF Q4 SOCIAL AD PRICES
2021 saw the highest Q4 year-over-year (YoY) CPM growth in five years, which may have set the stage for a big drop in 2022 even without the additional impact of other factors
SPENDING GROWTH MODERATES ACROSS CHANNELS
Spending increased over Q4 of last year in all channels, but lower ad prices have meant lower growth rates than previous quarters
FOCUS ON COMMERCE

HOLIDAY PERFORMANCE BY CHANNEL

Ad spending more than doubled across the Cyber 5 for retail media and paid search advertisers compared to pre-Thanksgiving November, while lower prices kept YoY search spending flat

PRODUCT AD SPENDING ACROSS CHANNELS

Search shopping campaigns did not increase spending until the holiday-focused fourth quarter, while retail media and paid social showed QoQ growth throughout the year

OMNICHANNEL GROWTH

Commerce advertisers are slowly but surely increasing the number of active publishers as they focus on where they can most effectively find their customers
CORE TRENDS

Social Trends

Impression volume soared by over 50% compared to Q4 of last year
Several factors contributed to much lower prices for those impressions, resulting in modest YoY spending growth
Impressions
QoQ
+14%
YoY
+57%
Clicks
QoQ
+19%
YoY
+67%
Spending
QoQ
+8%
YoY
+3%
CTR
QoQ
+4%
YoY
+6%
CPM
QoQ
-5%
YoY
-35%

Search Trends

Paid search impressions grew by 23% and clicks grew 22% over Q4 of last year
Average CPC declined 12%, yielding a 7% YoY increase in total search spending
Impressions
QoQ
+31%
YoY
+23%
Clicks
QoQ
+30%
YoY
+22%
Spending
QoQ
+21%
YoY
+7%
CTR
QoQ
-1%
YoY
-1%
CPC
QoQ
-7%
YoY
-12%

Retail Media Trends

Retail media ads were cheaper in Q4 2022 than in the previous year
The volume of retail media clicks increased over the same period, driving overall spending up by 34%
Impressions
QoQ
+17%
YoY
+45%
Clicks
QoQ
+16%
YoY
+50%
Spending
QoQ
+22%
YoY
+34%
CTR
QoQ
0%
YoY
+6%
CPC
QoQ
+5%
YoY
-11%

View reports from previous quarters:

Methodology

Analysis is drawn from a population of approximately $9 billion in advertising spend over five quarters, comprising more than 3,000 advertiser and agency accounts across 40 vertical industries and more than 150 countries running on the Skai platform on Google, Microsoft, Baidu, Yandex, Yahoo! Japan, Verizon Media, Amazon, Walmart, Instacart, Criteo, Kroger, Apple Search Ads, Pinterest, Snapchat, Facebook and Instagram.

Except where noted, analysis is based on Skai advertisers with 15 consecutive months of performance data. Some additional outliers have been excluded. Ad spending and pricing have been translated to USD at the time the spending was incurred.

For charts showing impressions, clicks and spending, volume metrics have been normalized to a factor of 1 based on the initial volume for the first quarter of data. Data points from subsequent quarters are based on a multiplier from the first quarter. For example, 1.6 means that volume is 60% greater than volume on the initial quarter measured.

Note: There may be variation in numbers for past or future research published by Skai as the rolling data set is dynamic for each new quarter.