CPMs Stabilize as Holiday Season Nears: A Signal for Local Sellers

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Some welcome relief may be arriving for publishers—especially at the local level. According to AdRoll’s Q3 Digital Advertising Report, advertisers are cautiously stepping back into the marketplace, nudging up demand for digital ads after a period of steep decline.

Key Metrics: Narrowing CPM Drops, Surging Traffic

• Display retargeting CPMs: After falling 18% in the prior quarter, they’ve recovered to a “only” 3% decline. (cost per thousand ad impressions.)
• Display prospecting CPMs: Improvement from a 31% drop in Q2 to a 14% drop in Q3.
• AI-driven traffic to retail sites: Skyrocketed—AdRoll reports a year-over-year jump of 4,700%—driven in part by more than half of consumers who now use or plan to use generative AI tools for shopping.

These numbers suggest what AdRoll calls “a growing advertising demand going into the holiday season.”

What This Signals for Local Media
For local media outlets—newspapers, radio, local cable, community websites—the trends carry both hope and caution.

• Hope: If national advertisers are loosening purse strings, there’s potential spillover into local programmatic channels. Local inventory may benefit as broader ad budgets expand.
• Caution: It’s not yet clear that the improving CPMs and rising demand will fully translate into dollars reaching smaller publishers or non-premium local sites. Programmatic layers and agency fees still eat into what local publishers net.

Strategic Moves: Don’t Wait for November
AdRoll’s executives urge marketers to begin investing in September and October, rather than waiting until typical holiday-heavy months. The logic:

• Early ad spend builds recognition and influences purchase decisions when they occur.
• For B2B brands, early positioning can sway budget decisions into the next fiscal year.

Vibhor Kapoor, Chief Business Officer at AdRoll, puts it this way: “As generative AI transforms search, marketers can no longer depend solely on website traffic to drive discovery. Channels like connected TV and other brand‐awareness tactics are becoming essential to ensure brands remain visible and memorable.”

Why This Matters for Local Ad Sales Managers Agencies

1. Selling Year-End Forward
   Local media sales teams should be ready now—with rate cards, audience insights, and packages that align with prospecting and retargeting demand. Local advertisers may respond well to offers that emphasize visibility ahead of the holiday rush.
2. Emphasizing Visibility Channels
   Local agencies and media-sales reps should lean into “awareness” platforms—broadcast, local TV, connected TV, outdoor—and bundle these with digital placements, especially retargeting, which is showing a faster rebound.
3. AI‐Powered Activation Messaging
   With consumers increasingly using generative AI tools for shopping, local campaigns that optimize for voice/search/finding products via AI may have an edge. Agencies should test these creative formats.
4. Early Outreach to B2B
   Many local businesses cut marketing budgets earlier in the year. The Advisory: reach them now. Positioning local print, radio, or digital campaigns as long‑term brand‑builders may pay off in future contracts and retention.

In short: the gloom is lifting in digital ad spend—moderately, but significantly enough that local media should take notice. Sellers who move early, package for awareness and conversion, and lean into creative platforms will likely capture more of the upside than those who wait until the final quarter.

Source: https://www.mediapost.com/publications/article/409204/holiday-escape-the-gloom-lifts-as-advertisers-are.html?hashid=S8UMnIfJRmSehv41KcdXAQ

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