Coronavirus Impact on Marketing, eCommerce & Advertising - Stats Roundup

The slowdown in economic growth directly affects the volume of the global advertising market. And we all know that the coronavirus pandemic has a big impact on the global economy. How does this affect the advertising market and eCommerce? In this article, we will look at the statistics. How much did the corona affect these spheres, as well as how much does it continue to affect? What has changed since the beginning of the pandemic, and what are the forecasts?

Popularity of ads

The cancellation of large-scale international events, professional offline events and quarantine contribute to the transition of the audience and advertising budgets online. Despite this, brands are also cutting spending on digital, postponing planned campaigns. Placing out-of-home advertising in most countries has become unprofitable. Online traffic, on the other hand, is growing rapidly… For example, in Italy, after the announcement of quarantine, it grew by 70%, in France - by 30%. In the United States and Russia, since the beginning of March, its volumes have increased by an average of 20-30%.

Now, in the face of uncertainty, brands are looking for more flexible and cheaper ways to promote. By reducing competition, the cost per click falls. For example, the CPM on Google Ads dropped by 20% on average across all niches. This creates more opportunities for instant value for brands in demand. And it also lowers costs for those who have made a bet on maintaining lasting connections with the audience.

Redistribution of traffic

A negative information background, a state of uncertainty and potential danger force consumers to abandon long-term plans. They are increasingly thinking about the future, health, financial well-being and meeting basic needs in the short term.

The leaders are media platforms for the production and distribution of content (entertainment, education), delivery of products and services for communication.

In the market, the biggest drop in traffic and online sales is especially noticeable in the following niches:

-coupon services (many of them are related to offline activity),

-automobiles and car goods,

-brands and premium goods (including clothing, accessories, interior items),

-gifts and flowers,

-travel (tours, vouchers, rental housing, tickets for air and land transport),

-offline entertainment.

Let's take a look at how this has influenced the trends and main types of online advertising.

Native formats and online media

All over the world, the demand for news has grown several times. Among the topics that most concern consumers are coronavirus, quarantine, financial and economic areas. Large media companies such as The New York Times, Wirecutter and Future recorded an increase in traffic and engagement in commercial content - recommendations, listings, special projects. The most popular of them are somehow related to COVID-19.

Facebook has become one of the main sources of traffic for native ads for large publishers (+ 50% to average). The social network is now actively fighting fake news and prefers content from the most reputable media. On the contrary, tabloids, small local media and heavily politically engaged resources are losing traffic.

Native ad topics with the highest conversions can be divided into three categories:

-health care and ways to avoid contamination (integration of food, online retailers, care products, medical products, etc.),

-emergency assistance (medical supplies),

-working from home and organising life in quarantine (includes a wide range of consumer goods and household goods: from the most comfortable work chair to a set of items for home yoga and tips for composing home images).

The increase in traffic also had a positive effect on the growth of new subscriptions. For example, Bloomberg's subscriber base has tripled. Overall, according to Piano, media subscriptions grew by 63% in the US and 267% in Europe.

Social media advertising

The average time spent by users on social media has increased as expected. For example, Twitter's audience increased by 23%. Facebook reported a double increase in traffic. Average engagement rates and total ad volumes, on the other hand, fell.

98% of Facebook's cash flow comes from advertising. Before the pandemic, 30% -45% of revenue came from industries that are now in decline - tourism, events, entertainment. 

Due to speculation, Facebook has banned ads for masks, hand sanitisers, surface disinfectants, and COVID-19 testing kits. Advertising with the use of terminology or images of the coronavirus falls under the ban. This forced the social network to change its algorithms, and users felt delays in ad validation, response to requests, and a rise in falsely rejected ads.

Delivery services of ready-made food and groceries, health products, media-on-demand, as well as services for communication (both for business and personal) benefit primarily from the dropped rates.

For many big brands, the crisis has become an opportunity to develop closer and warmer relationships with their audiences. The main communication trends are empathy, positive attitude and social actions to support the audience.

Display and search advertising

According to WordStream, since COVID-19 began to spread, the conversion rate on Google Ads has dropped by an average of 21%.

User searches have changed a lot, as have the behaviour of search engines, according to the SEO agency from Sydney. Users are more likely to notice inconsistencies between the SERPs and their search queries. For example, since the beginning of pandemia, there has been a decrease in the number of impressions and clicks by 7% below the average.

When it comes to displaying ads, the niches with the highest CTR and CVR are the following:

On-demand-media

This category includes streaming platforms, sites with video and audio content (Disney +, Netflix, Hulu, HBO, etc.). Perhaps one of the few to have increased ad spend since the start of the coronavirus epidemic.

Health products

There has also been an increase in requests for medical research and private visits to doctors. However, in most cases, they are associated with the cancellation of the recording or its transfer.

Entertainment and leisure services

This category includes games and educational resources.

Finance

Consumers are interested in exchange rates, economics and more applied things: looking for a new job and remote projects, sources of additional income, financial literacy courses and business consulting services. It is worth noting that this niche contains a large number of expensive keywords and a high CPC.

Consumer goods (e-commerce sites)

Food delivery and grocery delivery

Traffic and conversions in the grocery delivery niche are volatile. While big brands and franchises can boast of growing traffic and sales, small and medium businesses are doing much worse.

In the mass segment, the demand for grocery delivery is significantly higher than for prepared food. In a situation of economic uncertainty, it is more profitable and safer for consumers to order food and prepare meals on their own. As the similarweb.com report shows, in the UK, Germany, France, the US and Australia, the demand for online ready-to-eat food delivery has fallen as the epidemic rises. And in Italy, it is the other way around.

What about e-commerce?

Globally, e-commerce has so far only grown in the United States. Largely due to the presence of a developed ecosystem and large mass-market platforms (Walmart, Amazon). The fall in developed European countries is associated with both the impact of disrupted supply chains and less developed culture of online shopping and consumer reluctance to part with money.

Advertising in mobile applications

As with the desktop, consumers spend more time on mobile but pay less. A significant increase in traffic was felt by applications in the categories of business, education, games, sports and health (physical and mental), and communication programs (social networks, dating and communication applications). The most popular applications among the audience in the global context and in the Google Play App Store are Zoom, TikTok, Gmail, Netflix, Hangouts Meet by Google, Microsoft Teams.

As with social media, the App Store and Google Play moderators have tightened their app verification policies and are removing any coronavirus-related apps unless they are authored by certified healthcare providers or government agencies.

The most effective ad formats are Video, Native Ads, Mobile Games Ads, and Rich Media Ads.

Conclusion

Covid-19 has brought many changes in our lives. It has changed the way we think, function and activity. Accordingly, needs and priorities have changed. Marketing and eCommerce are required to adapt. Companies that want to survive must follow the changes and work in accordance with them.

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