We could talk about the 2022 edition of Black Week for ages, as it was something completely different compared to previous years. Significantly lower CPC prices with a diminishing CR% efficiency throughout the week turned into a strong weekend. The trend this year indicated a more careful consumption behavior, which may not be as surprising, given the macroeconomic situation.
The overall results and insights
In contrast to previous years, a lot of focus was on pure performance metrics, which we must scope out to fully understand paid social in November 2022.
Cost per 1,000 impressions (CPM) is the pricing model used by social media platforms to charge advertisers. The price fluctuates based on multiple dimensions, with competition having the greatest impact. It means that periods of higher competition, such as November, tend to be expensive for advertisers. We went into November with an expectation that the usual trend would follow and got positively surprised when we saw up to 40% cheaper CPM prices compared to the previous year. The significantly lower price could be driven by a bigger ad inventory and a greater focus on profitability, impacting the media investments.
Click-through rate(CTR) is just what it sounds like – to what extent users click your ad. In general, you tend to see that CPM and CTR correlate quite well which stabilizes the cost per click (CPC). In contrast to the usual pattern, we could see a fairly steady CTR compared to last year while CPM dropped.
While traffic increased significantly, it also came with diminishing efficiency. The conversion rate was, in general, lower compared to the previous year. If we look at the consumption pattern throughout the week we could see a slower start of the week than expected followed by a stronger weekend. Increased traffic throughout the week with a more efficient Black Friday indicates a more careful consumption behavior than in previous years – most likely driven by the macroeconomic situation.
Going forward
The cherry of 2022 was the performance driven by Tiktok. Anyone that has followed Tiktok from a business perspective in past years can agree that a lot of investments have been made to the platform in terms of tracking, optimization, and ad formats. We managed to onboard a few more clients this year and saw genuinely impressive numbers. It is a no-brainer to include Tiktok in your channel mix next year.
Common tactics and recommendations within paid social channels from successful clients:
Offering frequency: Single’s day was very strong for companies that made a marketing effort. Using the week between Singles day and Black Week as a cool-down period increased the buzz around Black Week.
Budget management: Clients who moved from optimizing the budget on the channel level to the business level saw a significant improvement in revenue/profit compared to the previous year.
Channel mix: Having a mix of Meta and Tiktok helped advertisers increase their reach, variate their communication, leverage cross-channel presence and thereby drive better performance.
Creative mix: A higher diversity of creatives in terms of format, dimensions, and messaging helped advertisers reach more users with a higher conversion efficiency.
Summary
While November is usually expensive for advertisers, we were met with surprisingly low CPM together with equivalent CTR that resulted in low CPC. The diminishing conversion rate efficiency was compensated by lower prices causing an overall better performance. Looking at the performance driven by TikTok this year, including the platform in your channel mix is definitely a must for the future.
Adam Hendele
Paid Social Lead & Team Lead