Marketers in the US are cutting traditional advertising at a quicker rate than digital media in the face of the novel coronavirus (COVID-19) outbreak. This is according to an IAB survey of buy-side marketers who have made short-term adspend changes as a result of the virus, questioned from 18th to 24th of March.
These marketers intend to spend 39% less on traditional media than they had originally planned from March to June 2020. Digital investment, meanwhile, is set to fall by one-third (33%). In March and April alone, traditional advertising is to be cut by 43% and digital by 38%.
While both will continue to see losses in May and June, digital advertising will fare better. It sees its planned reduction ease by ten percentage points to 28% while traditional reduces by eight percentage points to 35%. This slowdown suggests marketers may be deferring spend to later on in the year.
By medium in March and April, out-of-home (OOH) looks to be worst hit, with traditional spend set to halve and digital out of home (DOOH) falling by 45%. Further, despite at least 40% of consumers are watching more linear TV, marketers intend to cut investment by 41%.
Social and paid search are likely to see the smallest drops but investment may still fall by 33% and 30% respectively. On Facebook, brands are currently favouring organic content as a response to the outbreak.
While consumers are reading more online news, publishers aren't seeing incremental investment – digital display advertising across all sites is set to fall by 41%. Digital display does, however, show the largest slowdown in advertising cuts, easing to a planned 28% decline in May and June.
Consumers are split on how brands should currently advertise and instead want to see positive action being taken. The CMO Growth Council recommends focusing on "story-doing" not "storytelling". The IAB also found that marketers are shifting their messaging away from performance marketing.
While an advertising and global recession is now likely, brands should think twice about going dark – maintaining adspend can increase growth and share of voice. Having a clear response strategy is vital; Nike follows the “containment”, “recovery”, “normalisation” and “return to growth" steps.
This article is part of a special WARC Snapshot focused on enabling brand marketers to re-strategise amid the unprecedented disruption caused by the novel coronavirus outbreak.