The coronavirus epidemic has affected almost all areas of the economy. This could not but affect eCommerce since today many goods and services are both sold and promoted via the Internet. Many companies are now struggling to survive, and marketing is critical to rebuilding sales. How badly has the virus affected marketing, eCommerce and advertising?
Let's find out.
The optimism of marketers fell to the level of the 2008 global economic crisis.
The European Economic Community conducted a survey to find out how COVID-19 has impacted marketing activities, costs, jobs and productivity. One important takeaway is that marketers' optimism fell to 50.9 on a 0-100 scale, with 0 being the lowest level of optimism and 100 being the highest. Before COVID-19, the result was 62.7. Optimism peaked in February 2015 and reached 69.9.
The optimism score for B2B marketers is higher at 54.0 than for B2C marketers at 47.1.
The retail and essential goods sector
Although this segment has been affected by the pandemic, it remains “afloat”. But the participants in this market sector had to reorient their activities.
The state of e-commerce
In the first half of March 2020, a study was conducted in which respondents who live in regions affected by the coronavirus were asked how their lifestyle, reactions and opinions have changed against the background of the pandemic. And, as the results of the study showed, the current situation had a negative impact on retail trade.
In a pandemic, this sector is forced to sharply cut costs or even shut down. However, e-commerce is showing growth in the current environment. Research results indicate that up to half of Chinese people shop online. In Italy, 31% of residents order goods online. Similar dynamics were noticed in other countries as well. So, in Russia, 21% of respondents make online purchases, in India - 55%, in Vietnam - 57%. And in the UK, only 18% of respondents said they are more likely to use the services of online stores. Moreover, most of them have made online purchases before.
Shopping for the future
In the current environment, more and more people are making purchases in advance. This is shown not only by retail but also by e-commerce. As a result, this practice led to the fact that in many countries there was a shortage of essential goods. As a result, accusations appeared against those who make purchases in advance, that it was they who brought the market to such a state. This opinion is shared by 89% of respondents in the UK, 87% - in France, 86% - in Austria. But 46% of respondents from China and 40% from India blame the shortage of logistics failures. At the same time, in Asian countries, there is a more rapid growth in the volume of purchases "for the future".
Popular mobile apps for buying groceries
Every day in the world, there are records of downloads of applications through which you can make online purchases of products. This indicator peaked in mid-March 2020. So, in comparison with February, the number of downloads of the Instacart application increased immediately by 218%. Representatives of the developer company said that in the first week of March 2020, the number of orders through this program increased 10 times.
Walmart, which launched its own Walmart Grocery app, reported a 160% increase in downloads for the product over the same period. Earlier, representatives of this retail chain of stores announced that they were going to close this project.
Target, which is also one of the giants of the retail market, reported at the early stage of the pandemic an increase in the number of downloads of its own applications Target (98%) and Shipt (124%).
Purchase volumes are increasing
The recent trend to buy essential goods in reserve is not going to fade. Thus, the volume of such sales increased by 22%. In monetary terms, the increase amounted to 467 million pounds.
At the same time, analysts point to an increase in household spending on the purchase of essential goods. Sales of household items and pet care products increased by 65%, long-term storage products by 62%, frozen foods by 33% and alcoholic beverages (including low-alcohol drinks such as wine or beer) by 11%.
The above statistics indicate that in the current circumstances, the most “advantageous” position is the retail segment, which supplies essential goods, food products. At the same time, as noted, it is better for representatives of this sector to go online. Experts from Hopping Mad say that now is the right time to pay attention to creating or repairing your site. Good design, content and user experience bring customers and orders.
In this regard, those companies that previously used the Internet only to attract buyers to an offline store urgently need to establish online sales. During the epidemic, people should develop the habit of making stock purchases and purchasing medicines on the Internet. It also makes sense to speed up the development of your own mobile application. It will make it easier for consumers to purchase essential goods, as it allows such transactions to be completed within a few minutes.
Despite the difficult conditions for the global economy, the advertising business as a whole was not seriously affected.
Industry experts revised previous forecasts and noted that advertising spending in China will grow 3.9%. However, this indicator fell in comparison with the previously presented estimate. According to previous forecasts, the advertising cost in China should have grown by 6.9%.
Naturally, such a development was to be expected, since this year there is a decline in many industries, when, as in the past several years, the volume of production in the PRC has been constantly increasing. But even the presented estimate is higher than last year's indicators. The driving force behind the growth of expenses in this segment this year was the companies that spend on mobile advertising. This sector is expected to grow by 17.6%.
Industry experts revised their forecasts for other markets as well. As follows from the published data, advertising spending in the Asia-Pacific region will fall by 0.7%, in the UK - by 0.6%.
Experts also predict a decrease in advertising costs in future in countries such as Germany, Spain and Italy.
Social media imagery has changed
Another study indicates that advertising images posted on social media have changed. The experts presented their results based on analyses of more than 1,100 brands that order advertising on Google and Facebook. They noted that the number of images of social interaction (shaking hands, hugging, and so on) decreased by 27.4%.
At the same time, the character of such images has changed. The same study showed that since the first half of March 2020, the number of images of people washing their hands, splashing water, and so on has increased by 6 times. Up to 21% of all published ads now contain the words "sports" and "fitness". And in 39% of cases, advertising posted on social networks mentions digital goods (smartphones, TVs, etc.).
This means that the segment that is engaged in online advertising benefits from the current situation.
The media segment is also undergoing quite noticeable changes provoked by the global pandemic.
The number of people who use instant messengers has skyrocketed in recent months. So, only Facebook noted an increase in the number of users by 50% in countries affected by the coronavirus. WhatsApp reported a doubling of the number of messages and video calls. The number of users of the Facebook application in Italy increased by 70%. Instagram and Facebook Live show similar indicators. In addition, over the past year, the time for group calls through applications has increased by 1000%.
Despite the growth in the number of users, income in this area will decrease in the context of the pandemic. Specifically, Facebook is forecasting a $15.7 billion drop in revenue from earlier estimates.
What services are used more often
Recently, a study was conducted in which 13 thousand people took part. Of these, 95% of those surveyed spend a lot of time on various media available at home. As a result, the survey results showed that over half of respondents watch streaming services, 45% use social networks or spend more time chatting in messengers, and 10% shoot video content for the respective platforms.
Within the framework of the same study, experts found out how the respondents assess the nature of advertising campaigns by brands. Slightly more than 30% said that companies should promote their products through advertising, about 25% are against it, and the rest could not decide on the answer.
Media brands have also responded to the pandemic and launched new services. For example, in a number of social networks, centres began to operate that inform the population about the development of the pandemic. Some companies have cancelled payment for a subscription to certain content.
Coronavirus marketing is geared towards the internet. In a pandemic, many companies can no longer function, as usual, so they have to master Internet sites. Online business has its own advantages, the main thing is to organise and advertise it correctly. We all hope and expect Covid-19 to leave us soon, but we already know that the online world will stay for a long time and develop.
Nick Brown is a blogger and a marketing expert currently engaged on projects for Hopping Mad website development company. He is an aspiring street artist and does Audio/Video editing as a hobby.