How to Keep Your Digital Strategy Healthy During the Coronavirus Crisis

It’s hard to believe, but it was a mere two months ago that the social advertising landscape was fairly normal. CPMs and ad demand were within expectations, with the only sign of what was to come being trepidation at China’s industry slowing down to a new type of SARS affecting manufacturing production in the country. Fast forward to mid-April: over 75% of the world is in some sort of social reduction guidance, millions of US workers are out of jobs, the global economy seems poised for its first recession in a dozen years, and VPs of Data Science at certain ad companies find their time increasingly spent sitting on a floor in the corner of their home office drinking something stiff and listening to Portishead. How can one have the confidence and understanding to guide their company through these difficult times? We here at TONIK+ have been looking over the industry’s reaction to COVID-19 and some ways to keep your social advertising output at or close to pre-COVID levels.

What does the current industry landscape look like? The largest change has been in CPMs. While CPM isn’t a true measure of ad demand, it does tend to be a good barometer of how many accounts are bidding up for audiences. Based on the internal and external data we were able to gather, from mid-February to mid-April, CPMs have declined around 50% across social platforms, with the largest platform drop around 65% and the smallest at “only” 45%. That is exacerbated by social traffic being flat or increased over that period. Users are still on the platforms, but advertisers have greatly pulled back their budgets. Even more, some of the budgets being deployed on social are repurposed from physical and/or in-person advertising, since commuting and travel have been massively reduced due to shelter-in-place edicts. Even TV advertising is seeing budgets being redirected to social, especially as the pipeline of new TV content slowly dries up. Digital is quickly becoming the best avenue for advertisers given the low cost and traffic staying at their normal levels. However, throwing your content and budget at digital without forethought or planning won’t help get your message across. We’ve outlined three key items to keep in mind as you look to the get most out of your ad spend on digital.

Spend Wiser, not More

As mentioned earlier, CPMs are at about half of the normal level. For example, let’s look at a campaign that spends $2k per day and typically saw a $5 CPM. That CPM has now dropped to $2.50, meaning that the campaign is now obtaining twice as many impressions as before. That means the campaign is getting twice as much bang for its buck, right? Not really. While prices have been cut in half, audience sizes haven’t doubled. In other words, you’re reaching more users, but you’re not reaching the same quality of users in that second half of your spend. This can usually be seen in further downfield metrics like clicks. Pre-COVID, this campaign might have driven a CTR of 2%. However, CTR has seen a drop down to 1.6% despite the lower CPMs. How is that happening? Well, the first $1k of the budget is still driving a 2% CTR because it’s still reaching the same quality of users as before. That second $1k is going to a lower-quality portion of the audience, resulting in a CTR of 1.2%. Audiences are finite, making the relationship between spend and KPI asymptotic: there is a maximum number of KPIs you can obtain, and the amount you have to spend to obtain an additional KPI is going to increase the closer you get to that finite number.

What does this mean for your strategy? Well, it really depends on your goals. Are you looking to drive volume or efficiency? If you’re trying to get your brand in front of as many eyeballs as possible, then keeping spend levels as-is would be worth the decrease in KPI rate. If you’re looking to be as efficient as possible, then scaling back budgets to keep rates up and cost per KPI down would necessitate a pullback in spend. Diversification of campaign objectives would allow for spend to be spread across more types of campaigns, allowing for a broader reach at spend levels that would typically be out-of-reach for some brands. Platform tilting can help as well: if you’re seeing performance on some platforms outpace others, allocating budgets temporarily to only those platforms can help you keep performance up during a time where many ad budgets have been greatly slashed.

Get Platform Assistance

Despite traffic being at or above typical levels, social platforms are feeling the pinch of their ad demand unexpectedly being halved. This has led platform reps to descend further down their ladder of spenders, resulting in reps reaching out to brands that don’t hit a certain threshold of spend but are still spending on platforms during this time. This means that even a relatively small amount of spend on a platform could get you a rep assigned to walk you through some improvements and tweaks you can make to your ad setup to make it perform better. Even the most veteran ad strategist can use an inside track within the ad platform itself to obtain access to new ad types, strategy implementations, or more. Coupling cheaper ads with support that might not have been available to you a couple of months ago can help you really lean into getting the most out of a smaller budget.

Keep Your Content Fresh and Focused

With ad demand being halved but traffic remaining roughly the same, users are going to burn through the same ads at a massively accelerated rate. This is going to lead to a quicker ad decay, meaning that ads will take even less time to go stale and lead to negative sentiment from users. The worst possible outcome for an ad is one where you’re actively paying to get users to dislike your brand, so avoiding this is paramount. I know I personally will be avoiding buying from Darryl the sasquatch or anything from the “sad COVID-19 piano” library of advertisers that have repeatedly inundated my shows. Keep it simple and do the following:

  1. Focus on your product/service, not COVID-19
  2. Shorten your content refresh period

The first point is straightforward: everyone knows what we’re dealing with and doesn’t want to be thrown back into the real world during breaks in their escapism. Keep content focused on your offering and away from the pandemic, especially if your brand’s connection is tenuous to the response. We’re seeing brands that are stretching to align themselves with “fighting against COVID-19” getting hammered in terms of sentiment. Again, don’t pay to make people dislike you.

The second point seems like it would be less-doable during this time. How can you create new content when production has essentially stalled? Well, there are multiple ways to combat that. Deploy your content in waves instead of all at once; if you’re sitting on six new videos, deploy two to start, wait for them to decay, then swap them out for two more. Your messaging gets out there but without the repetition. Segment your audiences: reach fractions of your audience at a time and rotate periodically. An alternative to the previous example would be to deploy all six videos at once, but only target a third of your audience at a time, then rotate to a new third once the first group starts to decay. Finally, look to advertisers that can remix your current content into something that looks and feels fresh. We here at TONIK+ have TONIK+ Video Intelligence: a tool that takes your current content, identifies the top X scenes and/or seconds, and then creates new piece(s) of content based on performance and/or additional aspects you’ve selected. TVI can allow you to stretch your current library while you’re unable to shoot new content, providing multiple new spots and combinations of your content that will be highly resonant and less-prone to decay than the typical piece of content.

We’re going to be dealing with the fallout of COVID-19 on advertising for an unknown amount of time, and you don’t need a sad piano track overlaid over a slideshow to know that. The landscape of ad demand on social and digital has radically changed, but fortunately, the keys to success have remained steadfast. Recognizing what’s happening, adjusting strategy to account for or take advantage of, and recognizing performance changes over time are still as valid as ever. With ad demand down and platforms more eager than ever to help advertisers, there’s a lot to take advantage of even in these unprecedented times.

Bryan Williams, VP of Data Science at TONIK+

TONIK+ is a video intelligence and editing solution that utilizes Machine Learning & performance data to maximize the impact of targeted video campaigns.