AdRoll released the Q3 2023 edition of its State of Digital Marketing Report, a comprehensive summary providing invaluable insights into the changing digital marketing landscape in the second quarter of 2023. The report enables a deeper understanding of overall marketing trends and offers strategic ideas to improve marketing return on ad spend (ROAS) and return on investment (ROI) during these dynamic economic times.

“Amid economic uncertainty, a notable decline gripped consumer and advertising expenditures. However, we’re seeing signs of overall improvement, and now is the perfect time for marketers to take advantage of the current low ad costs,” said Vibhor Kapoor, president of AdRoll. “As we approach the holiday season with consumer uncertainty continuing, identifying pockets of opportunity and developing marketing campaigns to generate brand awareness and loyalty will be key to maximizing revenues during what’s predicted to be a $1.3 trillion 2023 holiday shopping season.”

AdRoll analyzed data from 2,000 online businesses in North America across finance, beauty and fashion, fitness, technology, travel and other industries, resulting in these key findings:

• Unusually Low Demand Results in CPM Plunging from -33% in Q1 to -49% in Q2. Contrary to the previous two years, where the average CPM increased from Q1 to Q2, CPM was down 49% on average in the second quarter of 2023 compared to the year before. This is primarily due to marketers and advertisers taking a more conservative approach to advertising in Q2 because of decreased consumer spending.
• Consumer Spending is Down, But the Economy and Consumer Sentiment is Improving. Many consumers were holding back on big-ticket items due to economic uncertainty. Still, they were willing to spend on products or services that enrich their day-to-day lives or improve their perspectives in the job market. Yet, with improving economic conditions and increasing consumer sentiment, it’s not a matter of whether CPM will increase, but by how much.
• Now is the Time for Marketers to Build Brand Awareness Ahead of the Holiday Season. Marketers should capitalize on the low CPM to build brand awareness among their high-value customers before the holiday shopping season, when CPM rises to the year’s highest levels. Once spending has increased during the holidays, marketers must turn their focus to conversion-driving campaigns, such as retargeting and abandoned cart recovery, to maximize return on ad spend (ROAS).