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The 2023 Catalog Ads Reports
Ground-breaking new data from over 3,500 Meta ad accounts reveal shocking trends for Catalog Ads.
To start, there are 3 major ad formats in digital advertising.
1. Video Ads
2. Static Image Ads
3. Catalog Ads
These two are the most talked-about because they’re the most creative. You can design your own videos/images, upload them, and test to see which are best.
This is the least talked-about because all you do is connect your product catalog to Meta, and run your regular product images as the ad creative.
What’s so special about basic Catalog Ads?
Catalog Ads are the least-understood ad type because it's the ad type that marketers have the least control over.
A few things that most people don’t know about Catalog Ads…
Auto-Relevant Delivery
The way catalog ads are served to audiences is based on matching specific SKUs with users looking for similar products.
Different Optimization
The quality of your product feed influences the performance of your product ads.
Not Just Retargeting
Catalog ads work especially well with Advantage+ campaigns for prospecting.
But perhaps the newest and most shocking fact about Catalog Ads is that..
Catalog Ads are the top performing ad type (by far).*
*According to data from Varos
In partnership with Varos, the world's largest benchmarking platform for digital marketing, we analyzed performance data from over 3,500 ecommerce brands...
In the first publicly-available study of its kind, we were able to separate out the performance of Catalog Ads from video and image ads.
This study represents over $4 billion in total ad spend on Meta.
We looked at in-platform CPM, CTR and ROAS.
Comparing the performance of Catalog Ads versus Video and Static Image Ads
Overall, across all categories of ecommerce businesses, we can see that the topline performance of Catalog Ads is shocking.
Avg. ROAS over 1 year
Takeaways
+78.3% LIFT
Is how much BETTER catalog ads perform versus image or video ads. The average ROAS of DPA is 3.075, while the others are at 1.725.
November & March
Are the months that DPA performs best, and has the highest spread from images and videos.
2x vs 3.4x
The best-performing month for Other was a 2x avg ROAS, while the best month for Catalog Ads was a 3.4x avg ROAS.
Perhaps more shocking, the click through rates of regular product image ads is consistently much higher than fully-designed ad creative.
DPA has a 36% higher CTR on average.
Avg. CTR over time (all verticals)
Takeaways
0.86
Average CTR of Image & Video
Meanwhile, despite much better ROAS and CTR, the CPM for catalog ads appears to trail regular CPMs very closely (although it is slightly more expensive).
Avg. CPM over time (all verticals)
Two leading factors behind why Catalog Ads are experiencing a general lift in performance over time may be due to the proliferation of Meta’s Advantage+ Shopping Campaigns and Facebook Shops, which are both growing rapidly in adoption by advertisers. Both the Advantage+ campaign type and Facebook Shops contribute more learnings to Catalogs, which we believe may be reinforcing the performance of catalog-powered ads.
Hypothesis
Catalog Ads in Fashion/Beauty
Let’s drill down.
Across all the categories of ecommerce that we looked at (across 3,500 brands), the two largest categories in the Varos dataset are:
Fashion / Apparel
Representing 1,000 brands.
Beauty
Representing 450 brands.
In the Fashion/Apparel vertical...
Avg. ROAS over time (fashion vertical)
Takeaways
3.1
The avg ROAS of Catalog Ads in Fashion/Apparel
2.1
The avg ROAS of Image / Video Ads in Fashion/Apparel
+50%
Improvement from Other to Catalog Ads
Unsurprisingly, November is the best time for Fashion brands to run catalog ads, with a 3.5 ROAS.
Also, CTR is over 40% higher on regular product ads versus well-designed image and video ad creative.
Avg. CTR over time (fashion verticals)
That’s right…
In the Beauty vertical…
Results aren’t as drastic as Fashion, especially because CPM and CTR are fairly tied.
Avg. CPM over time (beauty vertical)
Avg. CTR over time (beauty verticals)
However, ROAS is still consistently, materially higher for Catalog Ads than everything else.
On average, DPA performs 48% better than static image/video ads for Beauty brands.
Noteworthy: Unlike most other categories, July is the best month for DPA in Beauty.
Avg. ROAS over time (beauty vertical)
Conclusion
Catalog Ads, on average, have a 78% higher ROAS and a 36% higher CTR than regular image and video ads, while maintaining similar (but slightly more expensive) CPMs.
Do you see similar performance between the two groups in your ad account? Are your Catalog Ads performing much better than your other ads?
If not, there are several immediate steps you can take to get up-to-speed.
Step 1 : Learn the perfect setup.
Most brands don’t even have their product ads setup correctly. It can be confusing, and you can learn all the basics of a strategic setup for free
HERE.
Step 2 : Upgrade your Catalog Ad creative.
Top brands don’t run plain catalog creative. Creative is the biggest lever for performance - catalog ads are no exception to this rule. Use a tool like
Marpipe to make your catalog ads look great.
Step 3 : Clean up your product feed
Did you know that the health of your product feed influences delivery and performance? You can apply to get a Feed Score for free
HERE and see how you can improve your feed.
Step 4 : See how you benchmark against your direct competitors with Varos.
Perhaps your performance isn’t as bad as you think relative to your peer group - you can always find out with
Varos.
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