One thing that many paid media professionals have been noticing in recent years is the constant increase in the cost of paid ads, be it Google Ads, Meta Ads, TikTok Ads, etc. Following this idea, some doubts arise regarding the topic: what are the reasons for the increase in ad costs and how long will they continue to get more expensive
Although it is not an organic and free resource, investing in paid ads can bring extremely significant returns for companies, once they allow a greater reach of the publications developed so that the brand reaches a broader audience and, at the same time, segmented according to the persona designed in the services or products offered. AND, for this reason, even with the rising increase in prices, investments continue
The problem, however, there was a clear perception of the increase in prices in the area in recent years, unleashed, mainly, due to the pandemic. After all, with the dissemination, at a global level, of Covid-19 in 2020 and 2021, several establishments had to close their doors. In response to this strong impact on the physical market, we saw, consequently, a significant boost in internet usage by the population, to which he started to participate daily, of the lives of many people who, until before, they had no contact or interest in the virtual space
WHO data, as proof of this, show that there was an increase from 71% to 83% in the number of households with internet access between 2019 and 2020, corresponding to about 61,8 million connected homes. In this scenario, as physical stores would not be able to resume operations in a short time, the great idea that many entrepreneurs had was to start selling through the internet, where all the people ended up attending for long hours
Furthermore, during the time of social isolation, many professionals became unemployed and had to seek something to support themselves financially, which also triggered another highly prominent movement during this period: infoproducts. Among one of them, the popularization of paid traffic management content was remarkable
We had, so, three bases for the event we are analyzing, being them: the employers (of stores that closed during the pandemic), professionals whose jobs have been terminated and, finally, the sale of the knowledge necessary for unemployed people to start simple jobs in the area – what led to an overpopulation of both online stores and traffic managers. The result? Several stores in the same segment competing, in the auction system, the advertising platforms by the same keywords
In a parallel idea, as an example, when there is a surge in demand for a type of product and the market shows a lack of stock, what happens? The price increases. And that is what happened in recent years. There was a lack of audience for all these stores that did not know how to niche their e-commerces
This movement of rising prices was strongly accompanied by the entire market around the world, impacting, even, a series of popular food products on the Brazilian table, as demonstrated in an article by O Globo, "In January and February", the cost of food at home rose 2,95%, against 1,25% of the IPCA. El Niño affected the harvest. Bean, rice, potatoes and carrots have already seen an increase of over 10% in 2024
Related to international economics, we have as an example the data shared in the research "UK inflation rate: How quickly are prices rising?”, in which it was found that, despite inflation having fallen, significantly, since reaching 11,1% in October 2022, that was the highest rate in 40 years, this does not mean that prices are falling – just that they are rising less quickly. All of this indicates that not only are ad prices rising; but all costs are on an upward curve
In this general context, it becomes clear the reason for the increase in the prices of paid campaigns, being them, in summary: due to the general increase in prices universally (even in first world countries); due to the overcrowding of advertisers in the same niche, without differential points; and by the devaluation of the Brazilian currency, which ends up worsening the situation. In light of this, the trend of prices for PCP and PPI campaigns (pay-per-click and pay-per-impression, respectively) is that of continuous cost increase, or, at least, this is the shared vision of some professionals in the paid traffic field with years of experience in the market
