As lockdown begins to ease around the world, we’ve closely monitored what brands have done to maintain connections with customers throughout lockdown through social advertising. With people preparing to venture outside in increased numbers, the situation is set to change yet again.
We have once again asked consumers what retail brands should do right now? How can they make sure they not only survive but thrive in the upcoming months? Never fear, we’ve got you covered - we’ve monitored the trends and compiled insights from brands and consumers around the world - here’s what we found.
Opportunity to Win Market Share Right Now Is Huge
Even though ad spend is still down overall, retailers are upping their ante in social advertising currently at a considerably faster pace than any other industry. While still low, global CPMs have trended upwards throughout April, driven by steady development in the US and EMEA. Increased online traffic has led e-commerce CPMs to remain somewhat low and steady throughout April, while, on the other hand, retail brands rallied after pausing at the end of March and have steadily increased ad spend throughout April.
Whereas e-commerce has benefitted from robust online supply chains and increased organic search, retail brands had to take stock and understand how they could best serve consumer needs when physical locations were unavailable. Maintaining brand voice has been crucial, as has reallocating marketing spend away from stores and billboards and into digital.
Consumers have still made purchases throughout lockdown, and retail brands with the ability to advertise products based on consumer demand have maintained steady revenue streams throughout. Retail brands have worked hard to reach consumers through social, and it is beginning to pay off. User acquisition through advertising in social channels is considered almost like a safe-haven, a ROI-positive way to ensure both brand visibility and sales in these tough times.
Brands Are Beginning to Rebuild Their Customer Acquisition Funnels
With new groups of consumers online behaving in novel ways, many retail brands have steadily increased both retargeting and prospecting ad spend. Brands are slowly testing their way towards better targeted prospecting campaigns that work well in the current online marketplace. At the same time, retargeting (which steeply dropped off in March) is beginning to rise, which may indicate retail brands are now more comfortable the consumers they reach - and that visit their sites - are now connecting with them with the intent to purchase. We also see a rise in brand awareness campaigns, reach and frequency certainly seem to be top of mind for many advertisers.
In terms of purchase behavior, purchases made through social ads are still high, showing that consumers are still on social media and are highly engaged. In the US, a third of consumers have purchased something through social ads in the past 30 days. Looking forward to the next 30 days, the categories consumers are most open to buying based on social ads are groceries and fashion items.
New brand discovery is still happening at an increased level; consumers see more ads from brands that they have never purchased before due to high usage, low CPM’s and a general willingness to engage with ads more in this environment.
Consumers Are Getting Weary on COVID-Related Messaging
For the first time since mid-March, consumer sentiment for branded COVID-19 messaging has started to reduce. While still high, we’ve noted a slight dip in consumers requiring brands to address the situation with appropriate messaging.
In May, consumer sentiment towards ad space being used to promote philanthropic initiatives also decreased for the first time. The decrease was small, yet many brands already have initiatives in place, and it’s worth considering how consumers receive a new philanthropy program in light of the current climate. That ship might have sailed.
On the other hand, sentiment for ads featuring relevant product offerings has increased month-on-month since the beginning of lockdown. Once again, brands that are able to understand consumer needs and flexibly offer solutions for their new work-from-home life are seen as a valuable resource.
With CPMs still low, it is a good time for brands to acquire new customers and reactivate the customers they have. For retail, the main challenge to overcome has been related to supply, not demand - how can brands offer what’s needed now, not what they had planned to go on sale. With access to brick & mortar locations remaining very restricted, agility in digital channels equals resilience going forward.
We’ll continue to monitor the situation closely and share everything relevant and useful we learn with you. You can visit our COVID-19 Insights Hub for more information and if you have any questions, contact your Customer Success Manager or send us a message at firstname.lastname@example.org and we'll be in touch!