It’s no secret that COVID-19 has brought sweeping changes to our daily lives, and, by extension our online behavior. People are spending more time at home engaging with media, yes, but the way they’ve engaged with media has changed radically from week to week over the course of the last month. Each phase of the “shelter in place” journey has produced distinct human behaviors that have different effects on ad performance.
Phase 1: Scared
As stay-at-home orders went into place and brick-and-mortar locations shut down across the country, consumers turned to immediate needs and basic essentials. Under tight social distancing guidelines, these needs are primarily met through eCommerce. Brands offering products and subscription services for food, household items, and other basic essentials began to see strong ad performance while other categories lagged. This trend has slowed but remains basically true to this day.
Phase 2: Catching up
As consumers adjusted to the new pace of daily life, they began catching up on online errands that had been deferred or put off before. We witnessed a surge of interest in items like custom apparel for Fall and Winter weddings, items for seasonal sports activities like skiing, and other purchases that may have been low-urgency at this time of year but that were nevertheless going to be made sometime in the next three to six months. This short two-week period in March saw a lot of purchases that weren’t for immediate consumption and generated anomalous spikes in performance for specific brands. That phase is now conclusively finished, and conversion on advertisements for non-essential items is consistently down across different verticals.
Phase 3: Bored
Boredom begins to set in. Consumers have been at home for several weeks, both working and spending their free time online. With no more immediate needs to care for or wish list items to get out of the way, folks are doing a lot more aimless browsing. They might be clicking, but as the economic outlook darkens, people are doing a lot less buying, too. Advertisers see attractive prices for ad inventory and decent click-through rates, but on-site conversion is cut in half. This is the “new normal” we see persisting over the course of the next (hopefully few) months.
What To Do About It
With more browsing and less buying, there are a number of quick pivots advertisers can make in order to position for the new reality.
Offer the visitor to your site a compelling time-sensitive reason to be making this purchase now. Site-wide discounts and promotions are doubling ROAS, in many cases. While steep discounts might cut out margin, they bring in needed revenue today and help convert valuable customers for the future. We are noticing that promos succeed when they have advertised end dates, and brands should expect a lot of the volume to come in on that last day. Extending sales creates two end-date spikes and two surges of activity.
This is a unique environment where ad supply is up and ad demand is down, making it difficult to run performance campaigns but much more efficient to engage with prospects. Take advantage of the opportunity to pursue affordable reach and bring new customers into your funnel. These people will be essential to your company’s post-crisis recovery and growth.
Build retargeting or video view pools for later harvest
Video views and site traffic audiences are retargetable for six months. Take advantage of low CPCs and CPMs (and high video watch rate) to build these audiences now, then harvest these audiences once things return to some semblance of normal.
No matter how you respond, make sure to measure and optimize daily and weekly. The extreme pace of change in consumer behavior means that historical data no longer applies, and data from last week is too old to optimize against.
Stay nimble, stay current, and above all – stay home.