New report highlights lower display advertising costs and opportunities for brands to reach shoppers before holiday competition increases

AdRoll, an AI-powered multichannel advertising platform, has released its Q3 2026 State of Digital Advertising Report, highlighting a significant decline in display advertising costs ahead of the holiday shopping season.

According to the report, display prospecting CPMs dropped 45% year over year between July 1 and September 8, 2026. During the same period, display retargeting CPMs declined by 29.1%. The lower costs could provide holiday marketers with an opportunity to build awareness and reach new audiences before advertising prices typically rise around Black Friday and Cyber Monday.

Compared with Q2 2026, display prospecting CPMs decreased 25.5%, while display retargeting CPMs fell 40.2%.

Account-based marketing (ABM) showed a different trend. ABM CPMs increased 4.4% year over year, but declined 15.1% compared with Q2. Because ABM and retargeting campaigns generally target smaller, more defined audience groups, their pricing may not reflect broader advertising market conditions as closely as prospecting costs.

Consumers Continue to Spend While Seeking Value

Lower advertising costs do not necessarily indicate weaker consumer spending. The U.S. inflation rate remained at 3.4% in August, while the University of Michigan Index of Consumer Sentiment decreased 7.5% from August to September and was down 13.2% compared with the previous year.

At the same time, credit and debit card spending per household rose 4.5% year over year in August, with consumers showing a preference for retailers offering value.

While these indicators are not directly connected, AdRoll says they suggest that consumers remain active in the market while becoming more selective about pricing and overall value.

“With CPMs down across prospecting and retargeting, marketers have more room to test before holiday competition intensifies,” said Vibhor Kapoor, chief executive officer of AdRoll. “Compare the cost of reaching each audience with the engagement, conversions, and revenue that follow. Use that full picture to reallocate budget toward the channels producing the strongest business results.”

Turning Early Engagement Into Holiday Sales

The decline in prospecting costs gives brands more flexibility to reach potential customers before holiday advertising competition increases. However, converting that early awareness into purchases remains a key challenge.

A recent eTail and AdRoll study of 100 senior retail and ecommerce leaders found that coordinating messaging and timing across multiple channels was identified as the biggest retargeting challenge.

Although nearly all respondents considered themselves at least somewhat effective at re-engaging website visitors, only 13% said they recovered more than 20% of cart abandoners. Many respondents identified the first 24 to 48 hours following cart abandonment as the most important period for follow-up messaging.

Measuring the Full Customer Journey

Holiday shoppers are increasingly using a variety of resources before reaching a brand’s website, including AI assistants, search engines, social platforms, connected TV, reviews, publisher content and retail marketplaces.

As websites increasingly become a later-stage destination for shoppers checking product prices, availability and delivery information, marketers can look beyond direct conversions to understand how early advertising exposure influences behaviors such as branded searches, direct website visits and product-page views.

These signals can also help brands improve subsequent retargeting efforts. First-party customer data can be used to personalize follow-up messages and automatically stop conversion-focused advertising once a customer completes a purchase.

ABM Opportunities for B2B Marketers

As businesses prepare for year-end campaigns and 2027 planning, B2B marketers can also use account-based marketing to maintain visibility among high-priority accounts.

AdRoll recommends aligning advertising activity with sales outreach, adjusting messaging as customer intent signals evolve, and evaluating performance across engagement, pipeline development and revenue rather than relying solely on advertising metrics.