Why ad revenue jumps in Q4 and drops in January
Ad prices follow advertiser budgets. How the yearly cycle works, and how to plan launches and expectations around it.
If your ad revenue rose in November and fell sharply in January, nothing is wrong with your app or your site. Every publisher sees the same cycle, because it comes from the advertisers' side.
Why prices move
Your eCPM is set by what advertisers bid, and their budgets follow the calendar. Publisher Collective's guide to ad seasonality calls Q4 "typically always the best quarter". Black Friday, Cyber Monday and the holidays bring heavy spending, and advertisers rush to use up budget before the year ends. More bidders means higher prices.
Then January comes. Holiday campaigns stop, and the same guide notes that "revenue declines sharply compared to December highs" while advertisers wait for new annual budgets to be approved.
Planning around it
Ship big updates and launches in September or October, so your audience is at its largest when prices are highest.
Compare January with last January, not with December. A drop from December is normal. A drop from the previous January is worth looking into.
Budget on a normal month. The calculator gives you an average month. Treat the extra you earn in Q4 as a bonus, not as your new baseline.
If you run a website, publish seasonal content early. Gift guides and holiday articles need time to rank, and a gift guide published on December 10th is too late.
Run tests in the quiet months. When prices are low and steady, A/B test results are easier to read, because less of the change comes from the market.