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Trends and Insight in association withSynapse Virtual Production
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Social Distancing Continues to Increase Ecommerce Spending

30/04/2020
Digital Agency
London, United Kingdom
25
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One of Tug London's paid media directors, Ayisha Yousef discusses the positive impact social distancing has had on eCommerce and how we can capitalise on it

Tug London's Ayisha Yousef looks at how brands are increasing ecommerce spend during Covid-19 social distancing.

Although we’re in a time of uncertainty there is one thing that is certain, consumers’ increase in demand for eCommerce. The driving force behind the increase in demand is Government advice to urge whole populations to 'stay at home', social distance and avoid the outside world. With only essential shops allowed to remain open, searching for and buying products online is our only way to access them.  


How much are eCommerce brands increasing their investment?

The below diagram from MediaRadar shows that e-commerce ad spend doubled from $4.8 million the week of February 17 to $9.6 million the week of March 9th. This includes advertising spend across national TV, print and digital media, including websites, Snapchat, YouTube and podcasts.


Increased demand is comparable to the Christmas period

Most eCommerce brands make most of their sales and revenue during the few weeks of the year around Black Friday and the lead up to Christmas. However, since social distancing measures have been in place, the level of demand for many items such as books, toys, home workout equipment, homeware and loungewear is comparable to (and some cases, higher than) Christmas and Black Friday. As people are more likely to purchase during this time in lockdown, it’s definitely worth increasing your ad spend in order to drive incremental sales. (Source: Google Trends)

Amazon has cut Google Advertising Spend, creating opportunity for eCommerce brands

Amazon, one of the biggest investors in Google Shopping and Google Ads, has significantly reduced the amount they’re spending on Google, as they are struggling to keep up with increased demand for deliveries. What this means for Paid Search is that a lot of Google Ads auctions have become less competitive, creating an opportunity to drive lower CPCs.

Less competitive ad auctions and increased demand means there’s an opportunity to increase brand awareness, traffic and sales. It’s a great time to reach new customers that haven’t interacted with your brand before due to Amazon previously dominating the SERPs (Search Engine Results Pages).

There’s another opportunity for eCommerce brands as Amazon struggle to meet their ‘handled by Amazon’ distribution requirements. If you are a brand with the ability to take care of your own distribution, you could start or increase eCommerce marketing activity on Amazon Ads to fulfil customers’ demands.


Increase your marketing spend in line with increased demand

Look at your demand and supply levels and if possible, increase your eCommerce marketing budgets in line with the increase in demand. Fulfilling customers’ increased demands for eCommerce products in their time of need will drive an increase in sales for businesses in the short-term, and retain satisfied customers in the longer term.

If you want to learn more about Amazon marketing check out this blog post.

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