Which Is More Important For Marketing: Quality or Cost?

Written by Masie Pitchard

Digital advertising is a powerful and effective way to reach potential customers, generate leads, and increase sales. However, not all digital ads are created equal. There are many factors that affect the performance and success of digital advertising campaigns, such as the quality of the ad creative, the relevance of the ad to the target audience, the placement of the ad on the web page, the bidding strategy, and the budget.

One of the most common dilemmas that digital advertisers face is whether to prioritize cost or quality when creating and running their ads. Should they focus on producing high-quality ads that deliver a strong message and a positive user experience, or should they opt for low-cost ads that can reach a large number of people at a lower price? Which one will yield a better return on investment (ROI) and achieve their marketing goals?

Cost vs quality in digital advertising is a trade-off between how much money you spend to run your ads and how well your ads meet the needs and expectations of your target audience. Depending on your goals, budget, and industry, you may need to balance both aspects or choose one over the other. In this blog post, you will learn the pros and cons of cost vs quality, and how to optimize your digital advertising campaigns with tips, examples, and data tables.

In this article, we will explore the pros and cons of cost vs quality in digital advertising, and provide some tips and best practices on how to balance both aspects to optimize your digital advertising campaigns.

What is Cost in Digital Advertising?

Cost in digital advertising refers to the amount of money that an advertiser spends to run their ads on various online platforms, such as search engines, social media networks, websites, apps, etc. Cost can be measured in different ways, depending on the pricing model that the advertiser chooses. Some of the most common pricing models are:

• Cost per mille (CPM): The advertiser pays for every 1,000 impressions (views) of their ad.
• Cost per click (CPC): The advertiser pays for every click on their ad.
• Cost per action (CPA): The advertiser pays for every action (such as a purchase, a sign-up, a download, etc.) that a user performs after clicking on their ad.
• Cost per lead (CPL): The advertiser pays for every lead (such as a contact form submission, a phone call, an email subscription, etc.) that a user generates after clicking on their ad.

The cost of digital advertising can vary depending on several factors, such as:

• The type and size of the ad: Different types of ads (such as text ads, banner ads, video ads, etc.) and different sizes of ads (such as 300x250 pixels, 728x90 pixels, etc.) have different costs associated with them.
• The quality and relevance of the ad: Higher quality and more relevant ads tend to have higher costs than lower quality and less relevant ads. This is because higher quality and more relevant ads are more likely to attract users’ attention and generate clicks and conversions.
• The competition and demand for the ad: The more advertisers compete for the same keywords, audiences, or placements, the higher the cost of the ad will be. This is because the platforms that host the ads use an auction system to determine which ads will be shown and at what price.
• The time and location of the ad: The cost of the ad can also vary depending on when and where it is shown. For example, some days or hours may have higher traffic or demand than others, which can increase the cost of the ad. Similarly, some geographic regions or markets may have higher or lower costs than others, depending on the level of competition and consumer behavior.

What is Quality in Digital Advertising?

Quality in digital advertising refers to how well an ad meets the expectations and needs of the target audience, as well as how well it aligns with the advertiser’s goals and objectives. Quality can be measured in different ways, depending on the metrics that the advertiser uses. Some of the most common metrics are:

• Click-through rate (CTR): The percentage of users who click on an ad after seeing it.
• Conversion rate (CVR): The percentage of users who perform a desired action (such as a purchase, a sign-up, a download, etc.) after clicking on an ad.
• Return on ad spend (ROAS): The ratio of revenue generated by an ad to the cost spent on running it.
• Customer lifetime value (CLTV): The estimated total revenue that a customer will generate for a business over their entire relationship with them.

The quality of digital advertising can depend on several factors, such as:

• The design and content of the ad: The design and content of an ad should be clear, concise, compelling, and consistent with the brand identity and message. The ad should also have a strong call to action that motivates users to click on it and take further steps.
• The landing page or destination of the ad: The landing page or destination of an ad should be relevant to the ad and provide users with useful information or value. The landing page or destination should also have a clear and easy navigation that guides users to complete their desired action.
• The user experience and satisfaction of the ad: The user experience and satisfaction of an ad should be positive and enjoyable. The ad should not be intrusive, annoying, misleading, or deceptive. The ad should also respect users’ privacy and preferences.

Cost vs Quality: Pros and Cons

Cost and quality are both important aspects of digital advertising, but they often have a trade-off relationship. That is, focusing on one aspect may compromise the other. For example, producing high-quality ads may require more time, effort, and money, which can increase the cost of the ad. On the other hand, opting for low-cost ads may result in lower quality and relevance, which can reduce the performance and effectiveness of the ad.

Therefore, digital advertisers need to weigh the pros and cons of cost vs quality, and find the optimal balance that suits their specific situation and goals. Here are some of the pros and cons of cost vs quality in digital advertising:

Pros of Cost:

• Lower cost can allow advertisers to run more ads or reach more people with the same budget.
• Lower cost can reduce the risk and loss of running ineffective or unsuccessful ads.
• Lower cost can enable advertisers to test different ads or platforms and find the best ones for their goals.

Cons of Cost:

• Lower cost can compromise the quality and relevance of the ads, which can lower the user engagement and conversion rates.
• Lower cost can increase the competition and noise in the digital advertising space, which can make it harder for the ads to stand out and get noticed.
• Lower cost can affect the brand image and reputation of the advertisers, as users may associate low-quality ads with low-quality products or services.

Pros of Quality:

• Higher quality can improve the user engagement and conversion rates, which can increase the ROI and CLTV of the ads.
• Higher quality can enhance the brand image and reputation of the advertisers, as users may associate high-quality ads with high-quality products or services.
• Higher quality can reduce the competition and noise in the digital advertising space, as users may prefer and trust high-quality ads over low-quality ones.

Cons of Quality:

• Higher quality can require more time, effort, and money, which can increase the cost of the ads.
• Higher quality can limit the number or reach of the ads, as advertisers may have to sacrifice quantity for quality.
• Higher quality can increase the expectations and demands of the users, which can make it harder for the advertisers to satisfy them.

Industry	Average Marketing Budget as % of Revenue	Quality Metrics Used
Consumer Services	13.90%	Customer satisfaction, retention, loyalty, referrals, reviews
Education	13.40%	Enrollment, graduation, retention, reputation, ranking
Technology (Software/Biotech)	13.30%	Innovation, adoption, usage, retention, revenue
Communications/Media	12.60%	Reach, engagement, conversion, retention, revenue
Healthcare/Pharmaceuticals	11.40%	Compliance, safety, efficacy, satisfaction, loyalty
Retail/Wholesale	10.90%	Traffic, sales, margin, loyalty, retention
Consumer Packaged Goods	10.60%	Brand awareness, preference, loyalty, market share
Banking/Finance/Insurance	10.40%	Trust, loyalty, retention, acquisition, revenue
Manufacturing	8.60%	Quality, efficiency, productivity, profitability
Energy/Mining/Construction	0.50%	Safety, compliance, reliability, sustainability

How to Balance Cost and Quality in Digital Advertising?

As we have seen, cost and quality are both essential factors in digital advertising, but they also have their advantages and disadvantages. Therefore, digital advertisers need to find a balance between them that maximizes their results and minimizes their costs. Here are some tips and best practices on how to balance cost and quality in digital advertising:

Define your goals and objectives.
Before you start creating or running your ads, you need to have a clear idea of what you want to achieve with them. What is your target audience? What is your value proposition? What is your desired action? How will you measure your success? Having clear goals and objectives will help you align your cost and quality with your expected outcomes.

Do your research.
Before you choose your platforms or channels, you need to do some research on where your target audience is, what they are looking for, what they are interested in, what they are responsive to, etc. This will help you select the most relevant and effective platforms or channels for your ads. You also need to do some research on your competitors, what they are doing, what they are spending, what they are achieving, etc. This will help you benchmark your cost and quality against theirs.

Optimize your ad creative.
Your ad creative is one of the most important elements of your digital advertising campaign. It is what users see first and what influences their decision to click on your ad or not. Therefore, you need to optimize your ad creative to make it as appealing and persuasive as possible. You need to use high-quality images or videos that capture users’ attention. You need to use clear and concise text that delivers your message and value proposition. You need to use a strong call to action that motivates users to take further steps. You also need to test different versions of your ad creative to find out which one performs better.

Optimize your landing page or destination.
Your landing page or destination is another crucial element of your digital advertising campaign. It is where users land after clicking on your ad and where they complete their desired action or not. Therefore, you need to optimize your landing page or destination to make it as relevant and valuable as possible. You need to use a consistent design and content that matches your ad creative. You need to use a clear and easy navigation that guides users to complete their desired action. You also need to test different versions of your landing page or destination to find out which one converts better.

Monitor and analyze your performance.
Once you launch your digital advertising campaign, you need to monitor and analyze its performance regularly. You need to use various metrics and tools that measure how well your ads are reaching, engaging, converting, and retaining your target audience. You also need to compare your performance with your goals and objectives, as well as with your competitors’ performance. This will help you identify what is working well and improving your digital advertising campaign. You need to make adjustments and optimizations based on your data and insights. You also need to experiment with new ideas and strategies that can enhance your cost and quality.

Final Thoughts

Digital advertising is a dynamic and competitive field that requires constant attention and improvement. Cost and quality are two of the most important factors that affect the success and profitability of digital advertising campaigns. However, they also have their pros and cons, and finding the optimal balance between them can be challenging. Therefore, digital advertisers need to follow some tips and best practices, such as defining their goals and objectives, doing their research, optimizing their ad creative and landing page or destination, and monitoring and analyzing their performance. By doing so, they can create and run effective and efficient digital advertising campaigns that achieve their desired results.