Amid the COVID-19 pandemic, more users have taken to online channels and social media to stay connected through the quarantines and lockdowns being implemented around the world. In fact, “coronavirus” search interest has skyrocketed over time. Singapore search trends have been so high in fact, that in comparison to another popular search term “hdb”, the latter pales in comparison. And during another recent public health issue, the haze last year, search volumes during its peak are nowhere near where they are now.
On social media on the other hand, Kantar reports that Whatsapp has seen a 40% increase in usage, while Facebook usage has increased 37%. Since people are unable to socialize physically, we can infer that social media is now the channel of choice for people to connect with their peers.
Ad Revenue Declining Across Media Channels
But despite the increased usage of online platforms, advertising activity has come to a halt and ad revenues across media channels is taking a huge drop. In an article published by Variety, it says that “advertising heavyweights Facebook and Google are expected to bear the brunt of the downturn” with possibly more than “$44 billion in worldwide ad revenue”. Travel, retail, and auto are the industries leading the decline as they are some of the most badly hit sectors.
Despite this, according to another article on Protocol Media, Facebook while it’s core revenue driver is advertising sales, is predicted to come out of this unscathed having already made an estimated $70 billion last year alone.
Stepping in amidst losses
While a decline that steep can still hurt their business and overall market performance, it shouldn’t come as a surprise that once this passes, both businesses are expected to continue raking in billions in the years to come. What may come as a surprise (and a very pleasant one at that), is how the two companies have committed to providing support for the businesses and people who need to help.
Facebook will be rolling out a Small Business Grants program, where they are offering $100 million in cash grants and ad credits for up to 30,000 eligible small businesses in over 30 countries. At the time of publishing, this has not been fully rolled out yet, so if you’re a small business we encourage you to sign up for updates on the link here.
On the other hand, Google announced an $800+ million commitment to support small- and medium-sized businesses (SMBs), health organizations and governments, and health workers on the front line. For SMB advertisers, $340 million from the commitment will be granted as ad credits to their ad accounts (given that they have been an active advertiser on Google Ads since the beginning of 2019). You may check out the full update here.
Small businesses around the world have taken a huge blow amid the COVID-19 pandemic, many of whom have been forced to close shop, stop operations, and lay off hundreds of workers. As a digital marketing agency and as a small business ourselves, we’re incredibly see how the platforms that we’ve been supporting through the years are truly stepping in to give back as well.
Commitments from both companies are not being rolled out immediately nor all at once, so if you’re a small business waiting to see if you can benefit from this, we suggest signing up for updates on the platform to get more information about the grants. In the meantime, if your company can afford to keep operating, focus on your organic efforts by developing more relevant and brand-building content. This may be a good opportunity for you to be even more present and more personal with consumers who have been spending more time online. Use your platform to to educate, to provide updates, or simply to spread more positivity in the face of uncertainty. Just because your advertising is on hold, doesn’t mean your branding needs to be too.
According to Goldman Sachs, “peak-virus is expected over the next eight weeks”, so you need to make sure that you start reigning back your costs and control cash burn as early as now. We too are bracing ourselves for what’s to come so that we can come out stronger after this passes. We’ve listed a couple of other things that you can do to stay afloat through the period.
It’s been no secret that more users have taken to the internet to stay connected during this pandemic, especially with quarantines and lockdowns being implemented around the world. But despite increased usage of various online channels and social media, advertising revenue is declining across mediums.