If you’re an eCommerce brand dabbling in Paid Social advertising, it’s time to step up your game. A new report from Fospha, a leading measurement and attribution company, reveals that brands are only scratching the surface when it comes to maximizing their returns from Paid Social channels. In fact, many brands are leaving significant money on the table, only spending about 27.5% of the channel’s potential profitability.
Fospha’s fresh findings, part of their State of eCommerce Report H2 2024, shed light on one major issue—most brands are misplacing their ad dollars. The report emphasizes that too much focus is placed on Last Click attribution, a system that prioritizes demand capture over demand generation. In simple terms, companies are spending big bucks trying to grab customers at the very end of their journey, rather than investing in ads that make people want to buy in the first place. And it’s hurting their bottom line.
Untapped Opportunities Are Everywhere
Fospha’s report is full of insights that digital marketers, eCommerce heads, and brand strategists should pay attention to. It showcases the channels with the most growth potential as businesses gear up for the busy holiday season.
One of the report’s biggest takeaways? Paid Social is a goldmine waiting to be tapped, especially on platforms like Meta, TikTok, and Snapchat. Most eCommerce companies are currently spending just a fraction of what they could be to scale profitably.
But that’s not all. The report dives into which channels are seeing the most success for efficient customer acquisition, and it even lays out a step-by-step guide to winning big during peak periods.
In the past six months, brands have significantly increased their spending on awareness and consideration activities, especially in Paid Social channels like Snapchat, TikTok, YouTube, Pinterest, and Google Discovery. Year-over-year (YoY), cross-channel ad spend has risen by 50%, with impression-focused platforms leading the growth. Snapchat saw a 202% YoY increase in spend, followed by TikTok at 160%, and Pinterest at 93%.
The strongest growth has been in awareness channels, as brands adopt a full-funnel strategy. However, conversion channels like Google Shopping and Meta have seen declines in spend. Competition for ad placements has intensified, pushing up costs per acquisition (CPA) by 13% YoY, with Meta experiencing an 18% rise. As the ad market rebounds, advertisers are facing higher prices to reach and convert their target audiences.
Why Does This Matter Right Now?
As brands prepare for the upcoming holiday rush, this report couldn’t have come at a better time. Many companies are looking for ways to stretch their ad budgets while still making a serious impact. The data from Fospha clearly shows there’s a huge gap between what brands are spending and what they should be spending on platforms that are primed for profitable growth.
Jamie Bolton, VP of Growth at Fospha, summed it up: “This is our most comprehensive cross-channel analysis yet. The insights here aren’t just for show. They’re a roadmap for how to navigate the challenges of peak season and scale up every channel in your marketing playbook.”
What Makes Fospha Stand Out?
Fospha’s unique approach to cross-channel marketing measurement is gaining traction, especially with its no-code implementation, which allows clients to get set up within just 2-3 weeks. And with over $1 billion in ad spend under management for 150+ eCommerce brands, their insights are based on some serious data. Their report doesn’t just highlight the problems—it offers real-world solutions for marketers ready to shift strategies.
Ready to Maximize Your Ad Spend?
For any brand looking to increase profits and avoid the pitfalls of underinvestment, Fospha’s State of eCommerce Report is an essential read. With practical tips on how to adjust spending, especially for the peak season, it’s a must-have resource for anyone looking to make smarter decisions.
To get your hands on the full report and start optimizing your ad strategy, check out Fospha’s latest findings here.
