Should you be advertising on social media right now?
Posted on 6th April 2020 at 12:25
To advertise or not advertise? That is the question?
Like many other businesses across the globe, the team at Pink Leopard took a deep breath as the Coronavirus hit our headlines. For us, the initial concern was to ensure our staff and clients were safe and well along with implementing immediate measures for all team members to work from home.
The next step was to speak to our clients and strategise with regards to their social advertising campaigns. Our approach was to listen, empathise and add value where possible - this is still very much our position.
We have two arms to Pink Leopard - we run lead generation campaigns for a number of gyms and beauty & aesthetics clinics across the UK as well as manage a select number of e-commerce projects across the globe.
Our advice was different for lead generation clients versus our e-commerce clients. We advised the gyms, beauty & aesthetics partners to pause their campaigns just in the short term because of the imminent measures of lockdown, social distancing and self-isolation as we understood that their customers would soon be unable to visit the facilities. We are now creating strategies for each of these clients to ensure they are successfully adding value and staying connected to their audience via social media whilst we slowly start to reintroduce their paid campaigns. It’s very important to maintain a strong social presence and also not pause paid campaigns for too long.
E-commerce, however, has been a very different story… All of our clients have increased their advertising spend and we are seeing exponential growth. Which leads us to think - are we about to ride the wave of a digital boom? Let’s take a deeper dive into this...
According to Virgin Media, the UK's coronavirus lockdown has roughly doubled the UK's internet usage during the day due to many people now working or studying from home in an attempt to stop the spread of Coronavirus. Vodafone has reported similar with a 50% rise in internet use at this time. What does this mean? More people are online more often presenting an opportunity to engage with new and existing audiences.
According to Marketing Week, 86% of marketers expect to see a rise in social media activity and 79% predict an increase in e-commerce usage. Exciting figures for anyone selling their wares on social!
However, Socialbakers and Kantar have reported that some companies are pulling ad campaigns and reviewing ad budgets. Hmmm, this sounds negative but it’s actually very positive for those enterprises still in a position to invest in advertising. Why? Well, according to Socialbakers, CPC (CPC stands for cost per click. This is the price you pay for each click on your Facebook ad) in North America fell from $0.64 in December 2019 to $0.32 in mid-March 2020, and ad spend fell nearly 50% in the region during that same time period. CPC declines were similar in Western Europe ($0.43 to $0.20).
To back this up, we have been experiencing much lower CPC and CPM (CPM means Cost Per thousand (Mille), and is how much you want to pay to reach 1000 people on Facebook with your ads) since the Coronavirus outbreak. Here are a couple of examples:
Despite some companies relaxing their social advertising activity, the Kantar data finds that doing this could be detrimental to brands long term. It ran a theoretical test on an unnamed, but real beer brand. The team found that if the brand cut all its ad spend during the crisis, this would have a 13% impact on sales in the long run and make market share hard to recover. However, a 50% drop in ad spend would result in just a 1% drop in sales.
Data from BrandZ also shows that after the 2008/09 financial crash, stronger brands recovered up to nine times faster in terms of stock market value than others.
“Brand health becomes vulnerable when companies stop advertising,” says Kantar Insights global head of media, Jane Ostler. “If they do this for longer than six months it destroys both short and long-term health.”
Instead, she advises brands to change their media, messaging and touchpoints to ensure they are reaching consumers with communications they are most interested in. Marketers should look at how budgets can be spent most effectively to maintain a presence and key brand metrics if spend does need to be reduced.
“Hold your nerve,” she concludes. “This will pass and we will be in a situation where things start to recover. Have a view on the longer term as well as the short-term.”
In conclusion, since many people work from home and stay indoors much more now than just recently, consumers are online more frequently presenting fantastic opportunities to engage with new and existing customers.
Many affected companies have decreased their marketing budgets, because of this we are seeing a sharp drop in CPM and CPC prices (due to a decline in competition). Therefore, this is an ideal time for some brands to acquire new customers at a lower cost than previously.
Switching your strategy to spend more or less on social media needs to be considered but stopping altogether for too long could mean a steeper hill to climb once this is over.
We are here to help! If you would like to arrange a free strategy call with one of our experienced team then please secure a slot via this link - https://go.oncehub.com/Pinkleopard
Stay safe and look after each other.
Team Pink Leopard
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