How Digital Spend is Changing Amid COVID-19

4.24.20 | Ashleigh Wiemer

As we continue to adapt to the world with COVID-19, media consumption has accelerated across a variety of channels. As consumers are changing, so are brands and organizations. Fueled by the economic downturn and shelter in place restrictions, many are changing or halting marketing efforts.

Some brands and organizations are providing an essential resource amid the pandemic, while others are offering value in other ways. For those brands remaining active, there is a shift to inform, help and support rather than sell. According to eMarketer, the focus is turning to creative that emphasizes brand values, cause marketing and other upper-funnel messages [1]. Selecting the appropriate digital channels (i.e. social, display, video) to support a more engaging message will take priority over more transaction-driven channels (i.e. paid search).

All businesses and organizations have been impacted by the pandemic, however industries such as travel, media and entertainment are greatly effected. Given their initial projected share of digital display spend, as these industries decrease marketing efforts the effect on overall ad spend will be significant [1].

Digital can often be the first medium to turn-off, given the liquidity and real-time nature of most channels. Initial eMarketer estimates predict that US digital display advertising spend will decline by between 5.5% and 18.1% in H1 2020. This is a significant swing compared to their initial estimate (+19.2% in digital display ad spending for 2020) [1].

In February, eMarketer predicted a 20.7% YOY increase in mobile ad spending, but there is no longer any expectation that this figure will be reached with decreased spend at the end of Q1 and through Q2. Adomik (which allows publishers to track their ad monetization) released data that showed a 17.2% drop in week-over-week revenue from the 2nd to 3rd weeks of March alone [2].

We are monitoring ad and consumption trends to help guide our clients through this new media landscape. We look at emerging data, predictions and historical trends (even dating back to past recessions), but there is still a lot of uncertainty.

It is unclear what the full impact of COVID-19 will be on the ad industry and how that may impact larger marketing efforts. The way we approach uncertainty is to have a strong foundation of insights that allow us to support changing business priorities and evolve media strategy for new goals in the COVID-19 world.

Sources:

[1] Analyst Take: How the Coronavirus Will Change Our US Digital Display Ad Spending Forecast

[2] Mobile Advertising Declines Due to COVID-19, Despite Increased Time Spent