An Election, a Virus, Social Unrest and Economic Anxiety Lead to Unique Dynamics
By Noah Freeman, Head of Product at Aisle Rocket
The 2020 holidays were a season like no other, and that feeling was particularly acute in the consumer retail sector. After an unprecedented year of lockdowns, quarantine and economic shock, the make-or-break season for retailers is just around the corner. For a time, government stimulus kept consumer spending afloat during the market shock, but now that’s drying up and the promise of more stimulus money is shaky at best. Coupled with an election that over-indexed on Facebook to reach voters, and we saw significant trends in Facebook ad metrics that promise a dynamic market in 2021.
CPMs on Facebook were very aggressive in the lead-up to the election, and they were volatile audience by audience. Usually we see a general 20% increase in CPMs across audiences on Facebook starting around Thanksgiving, but in 2020 it happened in late September. Retailers knew that government money was running out and more was uncertain, and they were trying to capitalize on ecommerce before household budgets tighten.
Likewise, the 2020 election drove prices up across Facebook by mid-October. The most dramatic spikes occurred in audiences within specific geographies (think battleground-state suburban families). If you’re a mom-and-pop restaurant in Philadelphia trying to acquire new customers, the past two months weren’t your best season when it came to media pricing on Facebook. Campaigns bidding aggressively on audiences made prices higher for many small advertisers in local markets.
To adapt, we urge marketers to make sure they’ve turned on all of Facebook’s automation features. We suggested that they shouldn’t run more than 2-3 campaigns at a time, and they should turn on all CBO (Campaign Budget Optimization). This allows Facebook to optimize audiences for campaigns based on dynamic pricing, which was essential with the price variations we saw in late 2020.
During the run-up to any election, marketers shouldn’t turn on any more geographical targeting than necessary lest they fall into the trap of competing with campaigns for overly-valuable audiences. National advertisers should allow Facebook to optimize spend and avoid pricey geographies, and they should consider this according to any local and national political dynamics.
In terms of messaging, we urge our clients not to go anywhere near political topics during a political cycle. Though you might want to do something as harmless as encourage people to organize or participate, we argue that it’s not with the potential blowback in your Facebook feed. The national conversation was disturbingly raw and brutal last year, and the potential for negative fallout from any political topic likely outweighs any potential benefit. Moreover, any ads with even slightly political content have to go through a further rigorous approval process with Facebook that nobody enjoys.
Lastly, we always encourage clients to watch the comments closely on their in-market ads. Facebook has been an incubator for much of the acrimony and disinformation that pervades our media channels these days, and the risks are very real of a brand being hijacked and denigrated for some frivolous or tone-deaf political message on social media. Hopefully, the national conversation will cool down along with Facebook ad pricing now that the election of 2020 is behind us.