Comparisons to Previous Month (December 2023)
The table below reports the percentage changes in key metrics across digital channels when compared to the preceding month, December 2023. For each metric, positive percentages denote growth, while negative figures signify a decline.
Takeaways
Overall decrease in CPMs:
Following the holiday season's peak demand period in November and December, CPMs have been on a month-to-month downward trend. Apart from The Trade Desk and Google Ads Search, all platforms experienced significant double-digit drops in their January CPMs compared to December.
Overall decrease in CPCs:
Alongside the drop in CPMs, every platform except Google Ads Display and TikTok witnessed a reduction in cost-per-click (CPC), making it less expensive both to reach potential customers and to engage them with clicks. This trend suggests that January could present a valuable window for advertisers to capitalize on these lower costs across the board.
Comparisons to Previous Year (January 2023)
The table below reports the percentage changes in key metrics across digital channels when compared to the preceding year, January 2023. For each metric, positive percentages denote growth, while negative figures signify a decline.
X experiences big shifts:
The noticeable year-over-year and month-over-month reduction in X's CPM might signal a downturn in advertising engagement on the platform. Accompanied by a marked drop in CTRs and a notable rise in CPCs, this pattern suggests a decrease in user interactions with ads. Essentially, X may be becoming less engaging for users, potentially leading to diminished advertiser activity as 2024 progresses, especially in light of the escalating click costs. This scenario points towards a cautious outlook for advertisers considering X's platform for future campaigns.
Google Ads Performance Max sees a substantial surge:
In January 2024, Google Ads Performance Max experienced a notable rise in CPMs alongside an uptick in CTRs. This spike in usage of Performance Max seems to indicate an increased appetite amongst advertisers for more automation and more frequent clicks from consumers who are exposed to these ads.
YouTube as an opportunity: The notable increase in CTRs on YouTube may possibly be influenced by the platform's introduction of YouTube Shorts. This format, which offers 60-second, full-screen videos akin to other social platforms, aligns well with current social media consumption trends, potentially leading to higher engagement and CTRs.
While we can't definitively attribute the decrease in CPC solely to YouTube Shorts, the format's engaging nature might be contributing to a more interactive viewer experience. Additionally, with a slight decrease in CPM, the overall cost-effectiveness of advertising on YouTube is enhanced. This scenario suggests that YouTube, particularly with its Shorts feature, could offer advertisers a valuable opportunity to achieve greater engagement at lower costs, although the exact impact of Shorts remains an area for further exploration.
A Deeper Dive into Key Platform Metrics
This section unveils a graphical index summarizing monthly trends in platform metrics (CPM, CPC, and CTR) over the past six months. The left bar graph illustrates each platform's metric percentage change from the previous month. On the right, the line graph displays each platform's metric as an index relative to the average of the metric for all platforms from August 2023 to January 2024, with the average designated as 1.00.
Each platform's monthly metric is represented as an index, indicating its size relative to the average (indexed at 1.00). For instance, a relative CPM of 2.00 means the platform's CPM is twice the average. This visual aids advertisers in identifying patterns, recognizing channel-specific dynamics, and making informed decisions based on the size and direction of the platform metric in question.
