Full Funnel Strategy

CPMs Are Going Up 30-50% in Q4. Here's How Email and SMS Protect Your Margins

June 7, 2026 · 5 min read

Every year, the same thing happens in Q4. Advertisers flood the Meta and Google auctions for the holiday season. CPMs spike - 30% above baseline by October, 50% or more during BFCM week. Cost per acquisition rises. Margins compress. Brands that built their revenue model around cheap paid traffic find themselves paying twice as much to acquire the same customer.

The brands that maintain healthy margins through Q4 don't spend less on paid. They shift more of the revenue load to channels where CPMs don't exist.

The math on Q4 CPM spikes

If your blended CPA in Q2 is $45 and CPMs rise 40% in Q4, your CPA rises toward $63 assuming similar conversion rates and creative. That's $18 of additional cost per customer - cost that comes directly out of your margin on that first purchase.

For a brand at 40% gross margins with a $75 AOV, that $18 swing is the difference between a profitable Q4 and a breakeven one. And this happens every year, reliably, regardless of your creative quality or targeting strategy.

The solution isn't to avoid paid in Q4. It's to make sure paid isn't carrying the whole load.

How email and SMS absorb the spike

Email and SMS have no CPM. There is no auction. Sending a campaign to your list in November costs the same as sending one in July - your platform fee plus the cost of producing the content.

This means every dollar your owned channels generate during BFCM is generated at a fraction of the margin cost of a paid acquisition. A $100 order from a returning email subscriber during BFCM week has the same margin as a $100 order in March. A $100 order from a new paid customer in November has a $63 CPA attached to it.

The brands with the best Q4 economics are the ones that use Q4 paid media to acquire new customers while their email and SMS programs convert their existing list at full margin. The ratio of returning customer revenue to new customer revenue during BFCM week is one of the clearest indicators of a brand's unit economics health.

Building the Q4 owned channel strategy

Three things determine how much your email and SMS programs contribute during Q4:

List size and health going into November. The larger and cleaner your list, the more revenue it generates during BFCM at zero CPM. Every subscriber added in Q3 is worth more than one added in October.

Flow infrastructure already in place. Post-purchase sequences, abandon flows, and back-in-stock notifications run continuously through Q4 without any additional execution effort. Brands with mature flow stacks generate significant BFCM revenue automatically.

A coordinated campaign calendar. Your email and SMS campaigns during BFCM should be planned and built in advance, coordinated with your paid media, and segmented to the right audiences. Last-minute campaigns sent to full lists with generic subject lines during the highest-volume week of the year are a waste of one of your most valuable assets.

Related reading