As movie theaters and concert venues closed their doors during the pandemic, many shoppers turned to books, music, and video to fill the gap. Throughout 2020 retailers advertising on Google Ads experienced significant customer acquisition gains. In particular, books, music, and video ads saw return on ad spend (ROAS) increase two to six times on these channels while cost per acquisition (CPA) declined.
These findings from the 2021 Benchmarks Report outline how books, music, and video retailers achieved these gains and what retailers can do to advance this trend in the future.
Demand Surged As Costs for Books, Music, and Video Ads Declined
Predictably, as more shoppers turned online for their entertainment and shopping needs, demand for books, music, and video surged during March and April of 2020. Because of the high volume of traffic, and because some retailers reduced their ad spend due to the uncertain economy, competition and advertising costs declined. On Google Shopping, CPA declined 33% year over year to $10.72 for this retail segment. Likewise, CPCs declined 21% to average just $0.28 in 2020.
Retailers on paid search experienced similar cost declines. CPCs decreased 24% year over year, while CPA notably declined 51%. Part of the reason paid search saw such a decrease in customer acquisition costs was that conversion rates increased 54%, averaging 5.20% in 2020.
How Retailers Tapped into the Customer Acquisition Opportunity
The key to retailers’ success on Google Ads in 2020 was an appetite for risk and the flexibility to adjust goals, said Jonathan Martin, Director of Enterprise Customer Strategy at Sidecar. He spoke during a Retail Uncharted podcast exploring Google Ad performance throughout the pandemic. “There was so much uncertainty for such a big chunk of the year, but the Sidecar customers that held budget, increased budget, or maybe expanded their ROAS goal to be more flexible, were able to capture so much traffic as it came online,” explained Jonathan.
Successful retailers are now tasked with re-engaging new customers in 2021 and beyond, particularly as shopper interests shift given the loosening of quarantine restrictions and the new entertainment possibilities that brings with it.
Dive Deeper into Books, Music, and Video Ads
For an in-depth look at books, music, and video ads performance, access the complete 2021 Benchmarks Report. Sidecar analysts broke down important KPIs, including conversion rates, clickthrough rates, average order values, and more. Analysts further sliced the data by monthly ad spend and retail segment so that retailers can understand how their performance compares to similar competitors.