State of Digital Marketing Report

Marketing and advertising insights for digital marketers.

We analyzed data from thousands of online businesses to help marketers understand overall marketing trends and recommend strategies to further improve marketing ROAS and ROI.

2023 Q3 Report Highlights

Year-over-Year % Change Q2 2023 vs Q2 2022

  • 49% Decrease Advertising
    Costs (CPM)
  • 8% Increase Website
    Visitors
  • 13% Increase Conversion
    Events

It’s Prime Day for Advertisers

Advertising costs (CPM) trend

Median CPM 2021 2022 2023 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2021 2022 2023

The cost of advertising, as measured by average CPM, was down 49% on average in the second quarter of 2023 compared to the year before. Contrary to the previous 2 years, where the average CPM increased from Q1 to Q2, Q2 2023 actually saw a lower average CPM compared to Q1, pushing the year-over-year CPM change from -33% in Q1 to -49% in Q2.

Website traffic trend

Median Site Visitors 2021 2022 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2021 2022 2023 2023

Website visitors had a moderate gain of 8% in the Q2 2023 compared to the last year, but it was lower than Q2 2021. In general, website traffic level was relatively stable in the last 3 years.

Conversion trend

Median Conversion Events 2021 2022 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2021 2022 2023 2023

Website conversions tell a different story. They were up 13% in Q2 2023 compared to the year before, extending the gain from Q1. However, there was a significant variation among industries. Companies in the Career and Education sectors had their conversion number more than double from a year ago. Sectors related to entertainment and hobbies also had a sizable gain. On the other hand, companies in the Automotive and Real Estate sectors had a steep decline. Note: the definition of conversion varies by customer and doesn’t always refer to purchases.

The difference in the year-over-year conversion change reflects the consumer spending behavior in Q2. While consumers were holding back on big ticket items due to the economic uncertainty, they’re willing to spend on products or services that enrich their day-to-day lives or improve their perspectives in the job market.

“Although indicators suggest the global economy may finally be on the upswing, consumers are still very hesitant to spend. Advertisers should leverage this period when advertising costs are low to reach out to their high-value consumers, who may be different from those prior to the pandemic. They should then develop marketing campaigns to generate brand awareness and loyalty that can carry through to maximize revenues during what’s predicted to be a $1.328 trillion holiday shopping season of 2023.”

Vibhor Kapoor, Chief Marketing Officer at AdRoll.

Vibhor Kapoor President, AdRoll

How Marketers Can Prepare for the 2023 Holiday Season

As consumers continue the trend of starting their holiday shopping earlier and earlier, we encourage marketers to capitalize on low CPM now to reach out to their high-value consumers, learn as much about their preferences and shopping behavior as possible, and engage with them across the digital channels to build strong brand awareness early.

Then, as Q4 approaches, marketers will need to shift their focus to conversion-driving campaigns, such as retargeting and abandoned cart recovery, as consumer spending and advertising costs increase.

If you’re interested in building a comprehensive holiday marketing plan, check out our 2023 holiday marketing guide. The holiday shopping season starts as early as September, which means you need to determine budgets and deploy strategies now. Our guide has a month-by-month breakdown that includes where to put your budget to maximize results and win the holiday shopping season.

Key Takeaways

  • CPM dropped nearly 50% in Q2 from a year ago, while site traffic and conversions are up.
  • Economy and consumer sentiment were improving, but consumer spending was down. Low consumer spending affected marketers' decisions and ultimately drove down CPM.
  • Consumer spending will bounce back as the economy continues to improve. Adding in the force of the holiday shopping season, it’s possible we may see a rapid increase of CPM in Q4 this year.
  • Marketers should capitalize on the low CPM right now to build brand awareness among their haigh-value customers before the holiday shopping season when CPM rises to the highest level of the year.
  • As the holiday season approaches and consumer spending increases, marketers need to turn their focus to conversion-driving campaigns, such as retargeting and abandoned cart recovery to maximize Return on Ad Spend (ROAS).

FAQ

What is the AdRoll State of Digital Marketing Report?

The AdRoll State of Digital Marketing Report offers marketers insights into business and marketing trends based on AdRoll’s performance statistics of about 2,000 online businesses across finance, beauty and fashion, fitness, technology, travel and other industries.

What are the key performance indicators (KPI) reported in the AdRoll State of Digital Marketing Report?

The AdRoll State of Digital Marketing Report three Business KPIs:

  • Advertising CPM - the median advertising CPM (cost-per-mile) during the reporting period compared to the same period in the prior year
  • Visitor - the median number of visitors to a website during the reporting period compared to the same period in the prior year
  • Conversion - the median number of conversions during the reporting period compared to the same period in the prior year
What is considered a conversion?

On the AdRoll platform, the definition of conversion is set by customers. It can vary based on the business nature of the customer and the type of campaigns. For ecommerce sites, it usually refers to an online purchase. For other types of ebusinesses, it can be a subscription sign-up or a lead capture event.

How often will the information in the AdRoll State of Digital Marketing Report be updated?

The information in the AdRoll State of Digital Marketing Report will be updated on a quarterly basis.