As the Coronavirus pandemic continues, albeit at differing rates globally, a high proportion of marketers have seen media budgets reduced or even stopped altogether, but pre COVID-19 targets remain constant.
Using a combination of external research and internal analysis of our trends across the Ledger Bennet client base, here’s a snapshot of the current state of media spend and the opportunities arising from this shift.
Our media and strategy team recently ran a detailed client all hands on the subject of ‘Maintaining Revenue Performance with Reduced Media Budgets’ which is definitely worth a watch if this is a subject you’re currently challenged by, which is likely to be the case for many.
General B2B Marketing Snapshot
- 86% of marketers predict that their marketing goals will be harder to reach
- 60% of B2B marketers say they have paused marketing campaigns
- 53% of B2B marketers have put new product launches under review
- 72% of marketers predict their marketing goals will stay the same or increase
- Only 7% of brands seize the opportunity to invest more in marketing during COVID-19
Media Spend Snapshot
- Internet traffic has surged by a groundbreaking 50% since enforced lockdown and home working
- Facebook saw a 70% increase in engagement year on year at March 2020. Visibility and expansion of people who are actually engaging is increasing.
- March over March year on year outside of digital video and broadcast media we saw the biggest pull back on paid social.
- Paid search has stayed stagnant.
- Facebook has historically low cost per acquisition (CPA). October 2019 to January 2020 we were seeing $80-$90 cost per lead form filled out, then in March and April 2020 it dropped to $30-$40. This is because as businesses reduce or pull spend altogether competition reduces and CPA (cost per acquisition) drops.
- We predict during May 2020 CPA will probably increase again.
- Instagram is on a similar curve to Facebook, but CPA has begun to increase again more aggressively than Facebook.
- On LinkedIn likes and shares have increased massively. People working from home are using LinkedIn far more, but it’s difficult for the hard sell on things like demo requests. This is the case across all platforms.
- Paid search conversion has dropped. Top of funnel entry is at a higher volume, but there’s a significant reduction in conversion towards the bottom of the funnel as people aren’t taking action.
- Display ads, paid social and digital video have seen a 45% average reduction in spend but paid search has remained steady.
- There’s generally better engagement with ads later in the day.
How has COVID-19 Affected Deal Close Rates?
The expectation is no longer about achieving closed/won in a couple of weeks. It’s about deferring potential revenue to later in the year, in the meantime maintaining engagement with audiences using the right kind of content and communication.
- We’ve seen sales emails have ramped up significantly, but response rates are dropping.
- People are taking more time to digest content, but there’s far less activity at the bottom of the funnel indicating they’re engaged in research at the moment, and may be in a position to purchase when budgets are unlocked
- There’s a significant decline in bottom of the funnel activity due to reduced intent, reducing return on investment
- Content campaigns are on the rise – but the nature of that content has moved away from general research and white papers to action led advice that’s applicable to the current market situation.
Preparing for Success in the Second Half of 2020
The difficulty for most marketers at the moment is that generating revenue on the back of paid media will be tough when bottom of the funnel engagement is so low. The opportunity lies in building quality pipeline and audiences with the understanding that buying cycles have increase so your conversion may come a couple of quarters later than you’d normally expect.
- With email engagement rates on the decline, we’d suggest a selective approach to email marketing will be most effective.
- Bottom of the funnel activity and conversion is reduced. Where possible, soften the language and don’t use harsh calls to action.
- Because of the reduction in CPA in paid social it’s a great time for people to try to build audiences at a reduced cost.
- Ensure you’re analysing your bidding strategies on search and social.
- We’ve been making adjustments based on time of day and device to reflect consumer behaviour.
- Leave core campaigns and brand campaigns that have historically had a high return switched on.
- Un-gate content and invest in re-marketing to build quality audiences.
- Facebook and LinkedIn are the channels to hit at the moment.
- High volumes of top of funnel engagement mean that nurture is likely to be critical in the second half of 2020. Building up longer nurtures to match longer deal cycles. Not necessarily extending nurture, keep them engaged with what’s relevant and topical for them now. Be empathetic so you’re well positioned to revert back to revenue led conversations you were having pre COVID.
- Consider geographic diversification. Globally countries are being affected at different rates through the pandemic so if you’re a global organisation this may be a good opportunity.
- Avoid growth messaging, it’s not relevant. Messaging should be pivoted to build trust, making the audience feel safe and focusing on giving value without the hard sell.
If possible, try not to come off the radar completely. The data you’ll gather through advertising during this period will make it much easier to re-enter the market as things begin to return to normal. Re-entry after a prolonged period of absence will significantly reduce competitive advantage for businesses that cut spend altogether.
From the data we’ve seen, the bottom line is all marketing goals are likely to remain or increase. You need to hit audiences in such a way that they’ll invest when they can.
Watch the full recording of our client all hands ‘Maintaining Revenue Performance with Reduced Media Budgets’.