First Half - 2023
Retail industry and performance on
We are excited to bring you the latest benchmarks for the leading retail advertising platforms early this year. We’ve broken down key trends that shaped retail advertising in the first half of 2023. We hope these metrics will help you refine your marketing strategies in the second half of the year and, in particular, start preparing for a successful holiday shopping season.
While retailers and sellers still feel the pressure of inflation in 2023, we were encouraged to see the cost of advertising decline on several key platforms, driving significant gains in return on ad spend (ROAS) across Amazon, Google, Meta, and Instacart. Average order values (AOV) also increased across several advertising platforms, perhaps indicating consumer confidence or highlighting advertisers’ skill in targeting their most valuable shoppers. We’re eager to see how these trends shift in the second half of the year when we bring you our full-year 2023 Benchmarks Report.
Among our research, we found:
YoY Increase in Amazon Seller PPC ROAS
YoY Increase in Google CVR
YoY Decrease in Paid Social CPA
YoY Decrease in Amazon DSP ACOS
Quartile examined thousands of US businesses with active ad campaigns on Amazon, Walmart, Instacart, Google, Meta, and Bing. This report analyzed data from thousands of campaigns across these ad platforms. Brands advertising on these platforms had active campaigns for the full first half of 2022 and the first half of 2023. Quartile’s technology and team manages all campaigns featured in this report. The analysis took place in July 2023, when the standard attribution window of each ad platform had closed.
Quartile separated its analysis for sellers—businesses that sell to customers through the Amazon marketplace—and vendors—manufacturers or distributors who sell directly to Amazon at a wholesale price. The performance metrics for these groups varies, so we hope this will provide a clearer picture of how different kinds of advertisers are performing on Amazon.
Notably, sellers' cost per click (CPC) significantly declined in the first half of 2023, compared to the first half of 2022, down 13% year over year. The inverse occurred for vendors; CPCs increased 13% yearly. ROAS increased for sellers, up 13 %, and declined 5% for vendors. Both advertiser groups experienced an increase in AOV compared to last year, perhaps signaling greater consumer confidence in 2023.
Amazon DSP, which delivers display ads across Amazon’s websites and leading publishers’ sites, showed an outstanding conversion rate during the period. Thanks to Amazon’s targeting capability and brands and sellers have the ability to build audiences based on purchase signals.
US advertisers on Amazon DSP experienced greater returns in the first half of 2023. ROAS increased 16% due to lower CPCs and slightly higher AOV. With more advanced targeting capability, advertisers now have more precision to target shoppers in market for their products
This year, Quartile combined results for Google Shopping, Google Paid Search, and Google Performance Max to demonstrate the channel's overall performance in the US. CPCs for Google increased in the first half of 2023, up 4% year over year. Despite this, cost per acquisition declined 22%, compared to the first half of 2022.
This may be because retailers are taking a more targeted approach to advertising on Google, focusing spend on shoppers who indicate a high intent to purchase. This strategy helped retailers increase ROAS 14% year over year.
Like Google, Quartile has combined performance for Bing Search and Bing Shopping campaigns in the US. Last year, Bing was one of the most affordable advertising channels due to low competition among advertisers. The first half of 2023 shows an upward trend in average CPC, surpassing Google, which may indicate more interest in and competition on the platform.
Despite increased conversions, ROAS declined year over year, brought down by a 24% decline in AOV and increased costs.
In January of 2022, Meta revamped its advertising offerings to better comply with Apple’s App Tracking Transparency feature. The social platform removed certain ad targeting around sensitive topics and added enhanced ad controls for its users. We anticipated in our previous Benchmarks Report that retailers’ ads may have limited reach because of these changes, hurting audience growth goals.
Over a year later, we can see that CPCs have declined significantly on the platform, which has contributed to 10% increase in ROAS year over year. In fact, of all platforms tracked in this report, Meta drives the greatest ROAS due to its low costs and high AOV.
Walmart is the most affordable platform, boasting the lowest average CPC of this report, which makes it an ideal channel to test new campaigns and reach new shoppers.
Walmart is growing in popularity among consumers, as click-through rates jumped significantly in April, 13% month over month, and remained high throughout May and June. With that jump, ROAS also climbed, reaching a high of $3.99 in April. It will be interesting to see how this engagement evolves in the second half of the year, leading up to the holiday shopping season.
Instacart launched its advertising platform in 2019 and it continues to grow rapidly even as pandemic restrictions have faded and consumers returned to grocery stores. Instacart earned the highest average conversion rate off all channels in this report, topping 60%. It also captured the highest average clickthrough rate at 1.89%, indicating that shoppers are highly engaged and motivated to purchase on this platform.
Given the high level of engagement, it’s unsurprising that Instacart average CPC was also the highest in this report, $1.43. As Instacart grows and matures, more advertisers are competing for shoppers’ attention, driving up advertising costs. Despite this, Instacart ROAS increased slightly year over year, up 2%.
Your industry’s benchmarks are in
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