Annual Growth: Search CPCs and Social Media CPMs on the Rise

April has been an especially challenging month for our clients across auto and ecommerce, as the economy continues to rock consumers, with interest rates still at an all time high, and as we continue to approach election season.

Coming out of Q1, are April CPCs still sharply rising and is it isolated to any specific channel, and what can we do about it?

On the Social side of things, META has been relatively flat YoY, but the last two weeks of April have started to creep up; it’s possible as we head closer towards the summer and the start of the election season we may start seeing these begin to rise, but overall, things have been stable.

The main story is TikTok. As clients and advertisers begin to diversify their media spend away from META and Google, TikTok CPMS are rising. CPMs increased 13% in 2023 vs 2022, and have seen further increases of about 50% from September 2023 through Q1 of 2024. We expect this trend to likely continue further into 2024.

Paid Search, specifically Google, is mirroring more of the TikTok trend unfortunately. Since September 2023 when Google reportedly raised prices to help meet their revenue targets, CPCs have started climbing and haven’t really stopped.

April was no different as CPCs were up 13% YoY, leading advertisers to spending just to reach the same click levels they were at last year. In fact, Q1 ad spend increased 21% YoY, meanwhile due to actual demand, competition, and rising costs, total click volume on Google actually decreased.

With clicks continuing to decline, and costs going up, the latest news coming out of the DOJ’s anti trust trial, is hammering home that Google really does have the power to control prices as they are proving that over the years they have been changing the algorithm to raise prices through algorithm tuning to increase profits and not always at the benefits of the end user.

So what are advertisers to do?
At Green Line Digital, we’re working with our clients to make sure we:

• Diversify ad spend between channels & tactics
• Make every dollar count and focus on the right KPIS per channel
• CVRT to “offset” - find ways to improve conversion rates to make up for higher CPCs
• Learn fast & pivot from one strategy to the next

About Green Line Automotive:

Green Line Automotive is an automotive digital advertising agency created for automotive dealerships. Our mission is to deliver tier-one automotive advertising expertise, technology, and service to the tier-three dealers. We give you an advantage over your competition by giving every dealership the best in technology coupled with a fully customizable approach.

See our premier services such as Automotive Paid Search or contact us at info@greenline.nyc or 833-GLD-CARS.