Chris "Coz" Costello, Senior Director of Marketing Research @ Kenshoo
For years, Kenshoo has presented aggregated quarterly online advertising trends from our large client data set. As one of the most well-respected datasets by those who follow advertising performance closely, it includes many proprietary insights about what’s happening in the digital advertising industry on a macro level.
With 2019 being the first year where online budgets eclipsed traditional ad spending, 2020 was poised to be a breakout year for paid search, social, and ecommerce advertising. Of course, things didn’t go as planned—and many marketers are still trying to understand the extent to which the global health pandemic has impacted these core digital channels.
The Kenshoo Quarterly Trends Report for Q1 2020 is drawn from a foundation of nearly $7B in annualized marketer spend, over 750 billion ad impressions, and 15 billion clicks. You can download your copy to get the details, but here are a few of the major points surfaced in this analysis:
The fact that key metrics across paid search, social, and ecommerce advertising were up year-over-year in Q1—even with the pandemic landing in March—is a testament to just how strong the growth was in January and February.
Even though search, social, and ecommerce advertising grew in aggregate in Q1, we looked at 2019 numbers to estimate what the affected period might have been without COVID-19 and then recalculated Q1 2020 growth using those estimates.
Across multiple modeling scenarios, we ended up with a range for our possible outcomes. For all channels, without COVID-19, projected ad spending would have been more in line with some of the stronger growth numbers from 2019, and Ecommerce Advertising actually outperformed its estimate, which aligns with the surge we all saw in online shopping in March.
No one really knows how and when the ad industry will fully recover from this global crisis. It’s very much tied into how long nonessential businesses will remain closed, how long stay-at-home orders continue, and other key factors. However, the data shows that advertisers are already starting to push forward.
We analyzed the week ending in 4/11 versus the prior week (ending in 4/4). Shopping & Retail categories showed a positive week-over-week average in spend growth including Apparel, Fashion & Accessories which grew ad spending by 25% and impression volume by 32%.
On this same chart, look for categories with asterisks which showed a growth increase in the week ending in 4/11 versus the average of the four weeks leading up to the week of 4/11. Combining a short-term and medium-term view gives us a sense of the momentum in these categories.
To view the recovery analysis for social advertising and ecommerce advertising, download the full Q1 2020 report.
The report also includes how select verticals were affected by the pandemic in March—and, as you’d expect, it varies depending on the category. Check out the report to see that data.
Whatever industry you are in, the key thing to remember is that it’s important to be nimble right now. It is not likely that we will see a single post-COVID recovery period, rather that there will be multiple stages of getting back on track. Consumer spending behavior will look different in each of these phases as confidence and sentiment expands across sectors of the economy. Ensuring that you are ahead of what’s happening so that you can be ready with the right marketing strategy and messaging for each of these waves will be key.
After you’re done reading the Q1 2020 Quarterly Trends Report, check out our Marketing in a Crisis blog series to get tips, tricks, and deeper channel insights:
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