Rising Ad Costs in 2025: How eCommerce Brands Can Still Win with Smart Budgeting

jax5027
Aug 23
4 min read

What’s Really Going on With 2025’s Ad Costs?

Feeling like your ad spend is being held hostage by algorithms and ever-more-expensive CPCs? You're not paranoid—ad costs are soaring. Amazon’s cost-per-click sits around $0.98 nowadays, up a healthy 10% from last year. If you’re in a “sexy” category like electronics or wellness, expect £1.20+ every time someone rubs their sweaty finger on your product listing. Instagram? Try £0.40 to £1.60 per click and £4–£8 per thousand impressions.

The crowd is getting bigger and everyone’s shouting louder: more brands are pushing into paid ads, platform changes are shaking up the rules, and let’s be honest—every tech CEO has shareholders to keep happy. If your PPC ROAS feels like it’s circling the drain, you’re not alone.

Why Are Digital Ad Costs Shooting Up?

Let’s call out the real causes:

Burning Question: Are Google & Meta Ads Still Worth It?

Short answer—yes, if you’re strategic. The problem isn’t that ads don’t work; it’s that lazy advertising is going extinct. You can’t just increase budgets and expect magic. Here’s how to outsmart rising CPCs:

Step 1: Ruthlessly Prioritise Your Product Catalogue

Fed up with burning cash promoting every last SKU? Here’s your permission slip to stop.

Focus your spend on:

Proven bestsellers (the stuff you’d bet your company’s survival on)
Highest-margin products (hello, healthy profit cushion)
Product lines with strong repeat purchase data

Don’t believe the myth that spreading your budget across 50 products is clever. Plough £1,000 into five absolute winners and you’ll outpace competitors who try to be everywhere at once.

If you’re not sure where to start, dive into your Google Ads and order products by revenue + margin. The bottom performers are leeches—cut them and move on.

Step 2: Don’t Surrender Control to Algorithms

Automated tools like Performance Max sound tempting—but would you trust a robot with your wallet and no supervision? Didn’t think so.

Your move:

Use automation as your intern, not your CEO.
Set clear priorities: pause automated campaigns that hijack spend for low-margin or “dead” stock.
Regularly review search terms, placements, and budget allocation. Make manual tweaks where the algorithm gets lazy or goes rogue.

Keep strategy in your corner, and remember: algorithms are trained for averages, not your unique edge.

Step 3: Build Evergreen Campaigns That Actually Work

For 2025, “set and forget” is dead. But “set and scale” is thriving. On Meta and Instagram, success comes from evergreen ads you can run consistently—and scale smartly.

How?

Launch with a modest daily budget (say, £25–£40)
Give the algorithm room to find buyers who convert, then slowly ratchet up the spend as performance stabilises.
Refresh creative periodically, not manically. Find your best hooks and iterate on them.

This beats reinventing every campaign for every new promo. It’s sustainable, scalable, and less stressful for teams who crave some weekend downtime.

Step 4: Granular Targeting and Creative That Doesn’t Suck

Relevance, relevance, relevance. Rising ad costs amplify the price of laziness. Get sharp on your targeting and content, or watch your budget evaporate.

Segment campaigns by intent. Retargeting, prospecting, and re-engagement should be distinct.
Use audience signals: first-party data, purchase history, or email subscribers.
Make creative that could stop your nan mid-scroll. Crisp images, bold CTAs, punchy copy.

Bonus: Good creative helps lower CPCs and CPMs because platforms reward ads that get people to actually engage. Imagine that.

Platform-Proof Tactics for Profit

Smart Amazon Strategy

Amazon’s A10 favours brands who build organic engagement. That means:

Double down on product page optimisation (images, bullet points, reviews)
Drive some external traffic (think Google Shopping or even influencer UGC) to break the “Amazon bubble”
Encourage honest reviews and Q&As to build trust.

Instagram & Meta Mastery

Tighten up your audience targeting with lookalike and first-party data.
Blend placements: Stories, Feed, Reel—let Meta find the sweet spot but set hard caps if costs spike unexpectedly.
Keep landing page speed and experience sharp. Clicks are useless if your site loads slower than dial-up.

Budgeting Tactics for Today’s Reality

If you fancy a spreadsheet, try this approach:

Define Objective Outcomes: Know the minimum acceptable ROAS for your business.
Shift Budgets Weekly: Assign bigger slices to the best performers every Monday morning.
Reserve 10% for Testing: Always have a “wildcard” bucket for new creative, products, or platforms.
Don’t Overreact Daily: Let campaigns breathe; over-correcting too quickly can tank performance.
Audit Every Month: Trim deadweight, celebrate winners. Repeat.

Where Is All This Extra Ad Money Going?

Commerce media ad spend is forecast to balloon to $118B by 2029. Translation: the party isn’t ending soon, it’s just getting more expensive to drink. Brands, agencies, and platforms are investing because, despite the cost, smart advertising is still the ticket for profitable growth.

The trick isn’t spending less—it’s spending better than your competition. The businesses that survive (and thrive) are the ones who treat paid media as an active, sweaty sport, not a “set and forget” slot machine.

TL;DR: Your 2025 Ad Survival Checklist

Prioritise bestsellers and highest-margin products
Use automation wisely, not blindly
Build evergreen campaigns and scale with intent
Level up targeting and creative to stand out (or be ignored)
Commit to weekly budget adjustments and monthly audits
Never, ever stop testing—complacency is more expensive than any CPC increase

Want more eCommerce PPC insights, how-tos, or a fresh pair of eyes on your ad strategy? Check out our honest, founder-focused advice at JudeLuxe’s blog or say hello if your budgets are ready for battle.