What about the massive increase in views from people being stuck at home ? wouldn't that lead to a higher ROI when people eventually spend ?
In terms of ad spend reduction, How would this compare to regular media advertising spend (TV etc.) ?
In terms of ad spend reduction, How would this compare to regular media advertising spend (TV etc.) ?
> ...channel traffic, increasing by 15%
> ...one in four media buyers and brands have paused all advertising for the first half of 2020, and a further 46% have adjusted their spending downwards
> Digital ad spending is down by a third, according to the IAB — a slightly less painful drop than the traditional media’s 39% cut
Traffic is up but ad spending is down more than the traffic increase.
You’re right that some smart execs will run into the fire as everyone is fleeing, buying up cheap adverts for a long term investment. There are some signs of this with a few companies seemingly increasing spend to take advantage of the cheap prices. Purely anecdotally I noticed a lot more adverts from Scott’s on lawn care products. Their pitch is basically “hey so the lawn care guy is on lockdown... go to our site and we’ll ship you fertilizer and tell you how to apply it.”
To all the folks saying "4 guys in a truck is low-risk" that's only true if they're the same 4 guys every time and they're not all living with other people... for instance if one lives with a nurse and another with a nursing-home health aide, then, well, not so great, huh.
The execs running into the fire with ad spend to take advantage aren’t any smarter than the rest, just better positioned for the pandemic. I doubt virtually any of them prepared or planned for this scenario.
Though from my experience there’ll be lot of companies out there cutting short cycle high ROAS campaigns, throwing the baby out with the bath water.
TV as deals are often worked out O(months) in advance. I expect they've seen drops in bookings, but you won't see as agile of a reaction to the pandemic in Television.
There is an opportunity now to invest and come out ahead in the long run. Most companies are conserving and cutting back right now, given the uncertainty.
Also I noticed a number of the youtube channels I use to watch because they have useful information and I was learning from them have now reached the end of their knowledge. Thy are now posting fluff to try and get me to keep coming back, but I don't want to waste my time watching a 30 minute video to get 5 minutes of useful information.
One channel I watch use to only post about 1 hour long videos, now they have cut back and often only post a 5-7 minute video so I keep coming back. One the other hand another channel used to and still posts 1-2 hour long video, I don't bother going there anymore. The host is smart, but he takes too long to get to the point of the video, I have other uses of my time.
That will depend on whether people will have that money to spend economy bounces back. I am not optimistic, restaurants or hospitality industry are going to suffer for a long time.
And Youtube ads are sold upon delivery, I don't think they will be retrospective revenue share, which is impossible (the conversion is intractable).
Not when you're paying per impression? The way to think of this is good old supply and demand. There is a lot more supply of ad slots, and a general decrease in demand. Both of these directly mean lower ad rates.
That would lead to lower ROI as operating costs are increased to serve those extra users. Sure, with more users they'll serve more ads, but as total spend by advertisers is shrinking those ads will go off at bargain prices, it's simple math.
Anything is possible. It might be another Great Depression that takes years to recover from. Or maybe once this external force (quarantine) is removed, things will mostly bounce back.
So those advertising dollars might have a good ROI or they might not. At a time when revenue is down (even if just temporarily) and some companies are laying off employees, it doesn't make a lot of sense to spend money on something that might or might not be worthwhile.
France has just announced extending the lockdown one full month. UK has just announced they won't end the lockdown in the coming weeks, with no dates formally given (it was expiring today).
I'm saying that "when" isn't a given; instead, it's an "if". Companies (whose cash flow just tried up) don't want to spend on "if".