Q4 performance expectations for ecommerce advertisers on Facebook

I asked our Head Of Strategy Tom Wiseman to provide me with some top-level analysis on Q4 performance expectations for ecommerce advertisers on FB – its so good I’m just copying and pasting the email below:

It is difficult to predict what will happen to CPMs for a number of reasons mentioned below but I think it is safe to assume they will increase as early as November (similar to previous year) and could potentially be more competitive.

Why CPMs could be higher YoY:

Although CPMs have reduced recently which we believe is due to advertisers reducing budget due to a decline in visible performance in platform, they have remained higher than 2020

Visible performance is likely to improve with the introduction of 7dc modelled conversion and conversion value data which should result in advertisers seeing more potential in Facebook.

Although Q4 is different this year with lockdowns being lifted and high street spending has increased, consumer behaviour has changed and more people are shopping online which will result in more advertisers trying to capture this audience.

Supply chain issues could present a challenge for advertisers and limit their ability to scale which could contribute to easing CPMs.

Opportunities in Q4:

Although CPMs increase by 40% during Cyber Week, CVR increases by 130% which presents a big opportunity to drive efficient performance during a competitive period.

Advertisers who aren’t planning to discount during Cyber Week, we are seeing evidence of consumers searching for products as early as late October, therefore, it is key to get the strategy right and start scaling as soon as possible to capitalise on this intent and get ahead of the competition.

Advertisers who are planning to discount its obviously key to maximise sales during the peak in Cyber Week (which can easily be done very badly with incorrect approach to account structure and budgeting) as well as not relying too much on this week by utilising clever messaging and creative to inspire consumers to shop early.