As we attended the GPeC 2024 conference, one theme emerged loud and clear across all our interviews with leading marketing agencies: the rising cost of pay-per-click (PPC) advertising. We spoke to several industry experts who shared their perspectives on how 2024 unfolded for e-commerce marketing and what the future holds. Here’s a summary of their insights, which can guide businesses on how to adjust their strategies in a volatile advertising landscape.

1. The Persistent Rise in PPC Costs: A Multi-Industry Challenge

A consistent theme from every conversation was the significant rise in PPC costs. Agencies such as DWF, Hold Marketing, SINAPS, and Limitless, all pointed out that 2024 saw considerable increases in advertising expenses, particularly driven by global market shifts.

Eugen Predescu from DWF noted that industries have seen cost-per-click (CPC) grow by 10% to 15% on average, but key periods, such as elections in Romania, caused spikes in costs across the board. Chinese market players like Temu and SHEIN have also aggressively entered the market, pushing advertising prices even higher. This has been particularly felt in the fashion industry, where local and smaller players are struggling to maintain competitive ad spend in the face of these new giants.

Sorin Trifu of Hold Marketing echoed these sentiments, stating that “election years are atypical,” as large investments by political campaigns push other industries out of competitiveness. He advised his clients to focus more on customer retention and other mechanisms, such as email marketing, during these high-cost periods to avoid pouring excessive budgets into paid ads.

Similarly, George Rășchitor of SINAPS pointed out that fashion and low-budget consumer goods were among the hardest-hit sectors. He observed that many clients in these industries struggled to keep up with the rising ad costs, often needing to pivot their strategies to maintain sales. George noted that maintaining strong retargeting campaigns is key for large online stores, as it’s far more cost-effective to sell to returning customers, than continually acquiring new ones.

Mihai Vînătoru from DWF also emphasized the role of new, large-scale international players entering the market. He pointed out that industries with shorter decision-making cycles, such as pharma, fashion, and beauty, were particularly affected by these shifts. With such strong competition and budget pressures, these sectors have experienced more significant cost increases compared to those with longer decision-making cycles, such as IT or home and garden.

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2. The Impact of Data Tracking and Retargeting Strategies

Retargeting remains a crucial component of marketing strategies for many industries, but it’s not without challenges. The limitations on cookies and data retention (e.g., Apple’s ITP restrictions ) have forced marketers to adapt to shorter data collection windows, affecting how well agencies can execute remarketing campaigns.

Sorin from Hold Marketing stressed that the current environment makes it harder to collect accurate data due to the changes in cookie policies, with retargeting budgets often suffering as a result. He recommended that clients first focus on optimizing their data collection systems before investing heavily in retargeting, especially in a volatile data environment.

Similarly, Cătălin Macovei from Limitless highlighted the increasing importance of Performance Max (PMax) campaigns, which often include retargeting as a built-in component. He noted that retargeting typically takes up between 15% to 30% of marketing budgets, depending on whether the campaigns are left open or specifically targeted. Like other experts, he emphasized that the key to reducing advertising costs lies in proper data collection and feed management, particularly for product-driven campaigns.

3. The Growing Importance of Accurate Conversion Tracking

Accurate tracking and data collection were recurring themes in all our conversations at GPeC 2024. Mihai from DWF pointed out that tracking is often overlooked by smaller businesses, primarily because they don’t see an immediate return on investment. However, without precise tracking, optimizing campaign performance becomes nearly impossible. He mentioned that while mature clients often have highly accurate tracking systems, scoring between 8 and 10 in precision, many less experienced clients still struggle with clarity, often falling between 6 and 7.

Cătălin from Limitless emphasized that tracking is the first priority his team addresses when onboarding new clients. He humorously rated their tracking precision as an “11 out of 10,” highlighting just how crucial accurate data collection is to his agency. He noted that effective tracking leads to better decision-making, allowing businesses to optimize campaigns more effectively and reduce advertising costs over time.

George Rășchitor from SINAPS further highlighted the challenges businesses face when trying to track conversions accurately. He noted that issues such as double-counting or discrepancies between platforms like Google Ads and Facebook Ads make it difficult to get an accurate picture of campaign performance. George emphasized the need for solutions that can address these tracking inaccuracies to provide a clearer understanding of user behavior and interactions. This is where server-side tracking comes into play, as it offers a more reliable method to track and manage data without the limitations imposed by client-side solutions, helping businesses maintain data integrity and optimize their marketing efforts.

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4. The Road Ahead: Opportunities for Data-Driven Marketing

Despite the challenges, each expert also identified opportunities for improving PPC campaigns through better data management. The consensus was clear: those who invest in data and tracking today will be the winners tomorrow.

Eugen Predescu recommended that businesses focus on branding and long-term positioning, rather than chasing short-term sales, especially in an environment where ad costs are continually rising. Mihai Vînătoru observed that platforms like TikTok and other alternative advertising channels are starting to become more cost-effective opportunities than the traditionally dominant Google and Facebook.

Cătălin Macovei shared his ideal vision for the future, where all data, including product margins and customer behavior, is fully integrated into marketing platforms. Such transparency would allow agencies to better advise clients and adjust campaigns to be both profitable and sustainable.

Conclusion: Thriving Amid Rising PPC Costs

The PPC landscape in 2024 was shaped by rising costs, data tracking challenges, and increased competition from major global players. Marketing agencies are pivoting their strategies, focusing more on data accuracy, retargeting existing customers, and seeking cost-effective alternatives for acquiring new traffic.

As we move into 2025, the key to surviving and thriving in this environment will be a commitment to investing in tracking and leveraging data-driven strategies. The agencies we interviewed stressed that those businesses that are proactive about optimizing their data collection, tracking systems, and remarketing strategies will be in the best position to navigate rising costs and ensure sustainable growth.

A vital aspect of this optimization is the adoption of server-side tracking, which Tagual offers as a powerful solution. Server-side tracking bypasses issues such as ad blockers and cookie restrictions, ensuring higher data collection, a higher data accuracy and a clearer understanding of user behavior. By embracing this scalable and comprehensive approach, businesses can collect richer data, gain deeper insights, and ultimately improve the effectiveness of their marketing campaigns.

This post is based on interviews conducted with top marketing agencies at GPeC 2024. Special thanks to Eugen Predescu ( DWF), Sorin Trifu ( Hold Marketing), George Rășchitor ( SINAPS), Mihai Vînătoru ( DWF), and Cătălin Macovei ( Limitless) for their valuable insights.