Comparisons to Previous Month (August 2024):
The table below reports the percentage changes in key metrics across digital channels when compared to the preceding month, August 2024 (see benchmarking data). For each metric, positive percentages denote growth, while negative figures signify a decline.
Month-Over-Month Takeaways:
Search Ads correction: Following surging in costs in August, both Bing and Google Ads Search saw large drops in CPC at 42% and 39%, respectively. Bing CTR dropped precipitously, perhaps partially due to the platform’s focus on generative AI through its CoPilot tool.
X demand drops after a strong summer: Since June, advertiser participation on X has been on the rise with consistent MoM increases in CPM. September saw the first dip in CPM since June, showing a leveling in demand. CTR is still increasing MoM, showing that users are actively engaging on the platform.
TikTok CPCs on the rise: Advertiser cost on TikTok has been consistently ticking up, up 40% in August and 20% in September. On a year-over-year basis, CPCs are relatively flat on the platform (see YoY data below). Looking at all of 1H 2024, the share of advertiser spend on TikTok increased significantly from 12.5% in 2023 to 14.7% in 2024.
Comparisons to Previous Year (September 2023):
The table below reports the percentage changes in key metrics across digital channels when compared to the preceding year, September 2023. For each metric, positive percentages denote growth, while negative figures signify a decline.
Year-Over-Year Takeaways:
Instagram CTR improves: User engagement with ads on Instagram was up 74% YoY, indicating that algorithmic changes and ad format optimizations have been effective at “stopping the scroll.” In the first half of the year, proportional advertiser spend on Instagram increased from 12.8% in 2023 to 18.2% in 1H 2024.
X demand recovers: Although demand fell MoM, on a year-over-year basis CPMs are up on X, indicating greater advertiser interest. Surges in CPMs throughout the summer suggests that platform attention surrounding the election is likely driving up overall demand. CPCs dropped 20% YoY, which could indicate a lower perceived audience value for advertisers if the goal is driving website traffic. In 1H 2024, proportional spend on X plummeted dramatically from 4.7% in 2023 to just 0.1% in 2024.
LinkedIn demand drops: LinkedIn saw a 63% YoY decline in CPMs, indicating weakening advertiser demand. Not surprisingly, CTR was also down significantly; however CPC declined to a lesser degree.
Pinterest ad engagement jumps: Pinterest saw a 283% increase in ad engagement rate (CTR) YoY in September, with CPCs down 81% year-over year. CPMs were down 29% YoY, indicating a diminishing overall demand across all advertisers—that said, there were pockets of opportunity for brands able to capitalize on lower costs and increased engagement.
Improved engagement on Google Performance Max: Advertiser demand was roughly flat YoY as indicated by CPMs; however, CTR is up 13%, indicating that the platform is improving user engagement with ads.
How to Understand the Data
Changes in cost-per-impression (CPM): Advertiser Demand
Declining CPMs indicate a decrease in advertiser demand on the platform. Lower competition among advertisers results in a lower cost per thousand impressions (CPM), as there are fewer bidders for ad space.
Conversely, increasing CPMs indicate increased advertiser demand on the platform as there is more competition from advertisers.
Changes in cost-per-click (CPC): Cost to Advertisers
A decline in CPC indicates that the platform's ad clicks have become less expensive for advertisers. This may happen if there's reduced competition for click-based ads or if the platform has optimized its targeting algorithms to deliver more relevant clicks, thus increasing the available supply of quality clicks.
Increasing CPCs mean that the cost of getting a click has risen, which could indicate higher competition among advertisers for the same audience. It could also signal higher perceived value for reaching the platform’s audience.
Changes in click-through-rate (CTR): Ads Engagement
A decline in CTR suggests that users are engaging less with ads on the platform. This might indicate that ads are becoming less relevant, users are becoming desensitized to them, or that there are platform changes that have not been as effective.
An increase in CTR indicates higher user engagement with ads on the platform. This is a positive signal for the platform, as it suggests users find ads more relevant or engaging.