the impact of Covid-19 on marketing & advertising – Econsultancy

Of course, this has wide-ranging ramifications for marketing and advertising – as well as a number of other sectors like travel, entertainment and FMCG.

To help marketers keep on top of what this means for them, their jobs and their industry, we’re collecting together the most valuable and impactful stats in this roundup, updated regularly since 20th March 2020.

Read on for statistics on retail sales, adspend, streaming subscriptions, social media use, recruitment figures and much, much more.

Contents

Advertising

Q1 2021:

2021 projected UK ad spend growth revised down

Data from the latest Advertising Association/WARC Expenditure Report has predicted that ad spend recovery in the UK next year could be slower than originally expected. The previous estimate of a 16.6% return-to-growth in the sector throughout 2021, presented back in July, has therefore been revised down to 14.4%.

According to the report, cinema ad spend is set to make a strong rebound at a rate of 138.3% next year as long-awaited delayed blockbusters like James Bond: No Time To Die are finally released. Meanwhile, healthy growth in OOH ad spend is expected (+57.1%), after being heavily impacted by national and local lockdowns in 2020. Verticals that are underpinned by digital and online formats such as magazine brands and regional news brands are also predicted to fare better than most next year.

Overall ad spend for the whole of 2020 is now due to fall 14.5% on last year to £21.5 billion – a loss of £3.6 billion compared to 2019, with the Q4 period offsetting some of the damage thanks to festive advertising. However, the final quarter is still expected to see a 10.5% fall in ad spend compared to the same period in 2019.

UK ad spend is not expected to recover fully until well into 2022, the report claimed.

Q4 2020:

Video game industry ad spend rose 80% year-on-year in the first two weeks of November 2020

The video game industry spent more than $45 million in ad spend over the first two weeks of November 2020; a rise of 80% year-on-year, according to ad sales intelligence company MediaRadar.

This news follows a bumper year for the gaming industry as engagement amongst its core audience reached record highs and both Sony and Microsoft brought brand new consoles to market. In fact, it was the latter that drove much of the increase in ad spend. According to the data, Sony spent more than $15 million advertising the new PlayStation 5 in the month before its release – more than three times what Microsoft spent promoting its equivalent Xbox Series X. Nintendo also contributed to the rise, with ad spend increasing 138% in the first two weeks of November compared to the two weeks prior – all the better to compete with its rivals.

New games have also been released to coincide with these major new console launches, such as Call of Duty: Cold War and Assassins Creed: Valhalla, causing a 76% year-on-year increase in ad spend from video game titles overall. Additionally, popular gaming retailers increased promotions during these two weeks in an attempt to entice fans to spend throughout the much-anticipated launches.

13 stats that show how advertising is changing

Global ad spend predicted to have fallen 10.2% year-on-year in 2020

In a November 2020 report, WARC predicted that 2020 global ad spend will fall 10.2% to $557.3 billion compared to results from 2019. The ongoing fallout from the pandemic has meant that traditional media has had its worst year on record and this has had an enormous effect on the industry as a whole.

Drilling down by industry, ad spend in automotive is expected to decline the most severely overall in 2020, with a loss of $11 billion. Travel and tourism could see ad spend drop by a total of 33.8%, but looks set to rebound at the fastest rate next year at +19.5%. After a very volatile year, total retail ad spend could fall 16.2% to $54.3 billion and is only projected to rebound with a 5.9% growth next year – a much slower rate than some other verticals like automotive (predicted +14.1%) and media and publishing (+8.4%). Business and industrial could also struggle, as its forecast growth of 5.3% means investment in this sector could only increase by 2.5% on 2019.

Consequently, WARC says it could take up to two years for ad spend to fully recover to levels seen before the onset of the coronavirus. According to analysis, a 6.7% growth in ad spend throughout 2021 will only be able to make up for 59% of losses that occurred this year. In 2022, ad spend would need to rise a further 4.4% to finally meet 2019’s $620.6 billion.

Q3 2020:

ITV reports 7% year-on-year drop in ad spend for Q3

ITV has reported that its ad spend improved in Q3 after the first wave of the coronavirus caused a significant 43% decline in the broadcaster’s ad revenue throughout Q2.

In the third quarter, total ad spend was down by 7% year-on-year. Of the three months to September, July was the worst performing (down 23%) but August was up 3%. Meanwhile, September’s ad spend was down 2% and October, which falls in Q4, was down 1% – however, both of these months were up against coverage of the 2019 Rugby World Cup, suggesting ITV’s advertising outlook is improving rapidly, all things considered.

Categories that spent more money advertising with ITV in Q3 2020 than in Q3 2019 included FMCG, Supermarkets, Publishing and Broadcasting, Telecommunications, Food and Government, among others.

Despite this promising analysis, total ad revenue for the nine months to 30^th September was down 16% on the same time last year, however online revenues picked up slightly at +2% growth.

ITV remains optimistic and predicts its advertising revenue will return to growth in Q4, providing the national lockdown restrictions end as planned on 2^nd December, with an expected 6% uplift in November alone.

UK digital ad spend fell 5% year-on-year in H1 2020

Research from IAB UK, as reported by WARC, has found that UK digital ad spend fell by 5% in H1 2020 compared with figures from the first half of 2019.

Across the sub-categories within the digital marketing sphere, some areas performed better than others. Display advertising grew by 0.3% year-on-year to £2.84 billion, within which video advertising rose 5.7% mirroring increased engagement consumers had with video streaming services over lockdown. Without video’s strong growth, overall digital ad spend results would have been much worse.

Search ad spend, meanwhile, dropped by 3.7% during this period, representing a £143 million fall in revenue on H1 2019. Mobile ad spend also saw a decline, but a much more modest 1%. However, one of the worst affected areas of digital ad spend was classifieds, which saw a massive 33% fall in revenue, decreasing by £235 million to £485 million.

64% of marketers believe language is more important than ever in marketing communications

Survey results from hundreds of senior marketers, conducted by Phrasee and published in September 2020, have thrown the importance of the language used in marketing communications into the spotlight amid Covid-19.

Sixty-four percent agreed that ‘language has never been more important in helping a brand connect with its customers than it is today’, making it a top priority in the marketing leadership agenda. Consequently, 71% expect to spend more time scrutinising the language in their content in future marketing plans and budgets.

However, data also revealed that 82% of marketers struggle to create high quality branded content that uses effective language. Thirty-seven percent cited lack of investment in content creation and a further 37% claimed a lack of time spent on content as reasons for this, while another 36% stated they do not have enough writers on staff. Therefore, a little over half (51%) believe they are unable to create scalable and consistent messaging across different marketing channels.

AI copywriting: An overview

Q2 2020:

Biggest recorded drop in UK marketing budgets takes place in Q2 2020

The net balance of organisations that have cut marketing budgets fell to -50.7% in Q2, down from -6.1% in Q1. This latest figure is the biggest drop recorded by the IPA Bellwether Report since the report began twenty years ago – including the Q4 2008 financial crisis when marketing budgets were slashed to -41.7%.

Nearly 64% of those surveyed stated they had recorded a decrease in marketing spend between April and June, compared to 25% who recorded a decrease between January and March. Just 13% said they had seen an increase in budget for the same period.

Drilling down, a net balance of -76.6% of organisations reported cuts to their events marketing budgets in Q2, with just 3.6% claiming they had risen. Meanwhile, the reduction in main media budgets dropped to a net balance of -51.1%, the largest decline seen by the report for this metric. Out of all subcategories in main media marketing, OOH budgets unsurprisingly were hit the hardest (-61.2%), followed by audio (-50.0%) and published brands (-49.2%).

Direct marketing and PR budgets were least affected in the second quarter, but still recorded a severe downturn in net balance to -41.6%.

JC Decaux revenue down 63% in Q2 2020

In its H1 2020 results, JC Decaux stated its revenue plummeted by 63.4% in the second quarter of 2020, a figure it claimed was ‘historic’ for the company. OOH advertising has taken a huge hit from lockdowns and stay-at-home orders around the world and JC Decaux’s data reflects the extent of financial losses felt in the industry.

In Q2, the company reported €351.9 million in revenue, down from 1 billion during the same period in 2019. Revenue in Q1 was less badly affected, but still recorded a 13.1% year-on-year drop from €840 million to €723.6 million. Overall revenue for H1 2020 was down by 41.6%.

When it comes to revenue via geographic area, most regions saw relatively similar year-on-year declines. France and North America faired the best with -37.1% and -38.3% revenue growth respectively, while ROW and APAC saw the worst revenue declines of -48% and -43.7%.

The company said it has scrapped its earnings guidance for 2020 in light of the ongoing disruption and uncertainty caused by Covid-19.

Global mobile ad spend soared 71% in Q2

PubMatic’s Mobile Quarterly Index found that mobile ad spend soared 71% year-on-year during Q2, rising to 77% in the Americas, as spending across other areas was slashed.

While APAC experienced lesser year-on-year growth than other geographical areas (+66%) its 30% quarter-on-quarter growth was particularly strong, reflecting both the increasing cost of ads in the region and its advanced position in the timeline of the global pandemic. This could indicate that APAC will see the strongest immediate recovery in this metric as the outbreak subsides.

Despite being heavily impacted at the start of the outbreak, mobile video platform spend has seen a strong and steady recovery since the end of April and is now measuring 116% up on pre-pandemic levels in the US. As of Q2 this year, mobile now has a majority share of video ad spend across APAC (74%), EMEA (70%) and the Americas (60%).

Social media

Q1 2021:

Events of 2020 have changed brands’ social media priorities for 2021

A Hootsuite report – Social Trends 2021 – has identified how the events of 2020 have changed brands’ priorities in social media marketing for 2021. Conducted throughout Q3 2020, the survey interviewed more than 11,000 marketers from across the globe.

Between July and September this year, Instagram’s advertising reach increased by 7.1%, more than three times that of Facebook’s, which saw a 2.2% growth. Despite this, Facebook is viewed by 78% of brands as the most effective way of achieving business targets.

Instagram’s 2020 growth in reach can’t be ignored, however, and is reflected in the fact that 61% of brands are planning to increase their budgets for this platform in the coming year. Facebook ranks second (46%), followed by YouTube in third (45%). Interestingly, despite the huge popularity of TikTok since the pandemic started, only 14% hope to increase their budgets for the channel, making it second least prioritised social media platform after Snapchat (4%).

When it comes to businesses’ social goals for 2021, increased acquisition of new customers is the clear winner, with 73% of organisations citing this as a top objective compared to just 46% last year. Increased awareness of their brand was also considered important by 64% of respondents, as was driving more conversions (45%).

Q4 2020:

One in four online purchases are now made via an interaction with a social media platform

Analysis commissioned by Visa, which studied shopping habits over the six months to October 2020, found that one in four online purchases in the UK are now made as a result of interacting with a social media platform.

Furthermore, close to a fifth (17%) of consumers purposely turn to social apps for shopping. Of those that do, 35% cited convenience as a key purchase driver, while 26% also said they liked how quick it is to check out. However, more than half (57%) admitted to neglecting online security by not always reviewing third party ratings for the websites they were purchasing from.

More often than not, data shows, consumers are disappointed with the goods they receive when shopping via social platforms. Fifty-eight percent of respondents claimed they were dissatisfied with their purchases and 38% were in the process of trying to process a refund or return of such items. Worryingly, with more than half (54%) failing to check the refund/returns policies of social retailers, just one-fifth said they have received a full refund via the method with which they first paid and 88% said they have been left out of pocket for at least one purchase.

These figures highlight the potential risk associated with purchasing from lesser-known retailers that advertise on social media. The way in which social media lends itself to more impulsive spending, particularly with the addition of speedy checkout, also appears to mean that shoppers are less likely to make the necessary security checks that they might usually do when landing on a webpage directly from search results, for example.

Q3 2020:

Global social ad spend rises 56.4% quarter-on-quarter in Q3 2020

SocialBakers’ Q3 2020 Social Media Trends Report has found that global social ad spend rose 56.4% in Q3 2020 compared with figures recorded at the end of Q2. This figure increases to 61.7% in North America, with the widespread Facebook ad boycott in this and other regions throughout Q2 partly responsible for the sharp upturn in Q3.

Central America saw the second highest growth between these two periods at 55.6%, while Western Europe came third (50.4%). By the end of September, the average global ad spend on social media was nearly double that of its lowest level at the end of March when many Western lockdowns were first imposed.

Encouragingly, the report indicates overall global ad spend on social has returned to levels similar to those seen in Q3 2019, and marketers predict that it will continue to improve over the holiday season as brands try to entice consumers to shop for gifts via social platforms.

Zooming in, social ad spend saw the highest jump across the FMCG food (+61.3%), automotive (+59.4%), finance (+35.3%) and ecommerce sectors (+27.5%). However, spend in the accommodation industry remained volatile throughout the quarter amid a second wave of the virus, ending with comparable spend levels to those seen in the latter part of Q2.

Social Media Advertising Best Practice Guide

Facebook ad revenue rose 22% year-on-year in Q3 2020

Facebook has announced its earnings for the third quarter of 2020, in which ad revenue rose 22% year-on-year to $21.2 billion. This is a much larger growth than the 10% year-on-year growth reported in Q2, which was affected by a decrease in ad spending from financial uncertainty surrounding the pandemic and the Facebook ad boycott.

Both Daily and Monthly Active Users increased by 12% compared to Q3 2019, reaching 1.8 and 2.7 billion users respectively. However, the company said it had seen a quarter-on-quarter decline in active users from the US and Canada as unusually high engagement rates earlier in the year began to level off.

Meanwhile, Family Monthly Active People (users who access at least one app monthly from Facebook’s family of apps, Facebook, Instagram and WhatsApp) remained high at 14% up on Q3 last year.

In its financial statement, Facebook said that Q4 advertising revenues so far appear to be performing even more strongly than those recorded in Q3, likely boosted by brands looking to increase their festive sales.

Tencent reports an 89% rise in profit for Q3

Tencent, which owns mobile platforms WeChat and QQ, as well as several best-selling browser and mobile games, appears to be reaping the benefits of the video gaming boom that has come about as a result of the coronavirus pandemic. In a financial statement, the Chinese company said it had seen an 89% rise in profit in the three months through September and made a total of 125 billion yuan (US $18.4 billion) in revenue.

Its online games arm reported a 45% increase in revenues (41.4 billion yuan) thanks to the unprecedented growth of its hit titles such as Peacekeeper Elite and Honour of Kings, the latter of which reached 100 million DAUs in the first 10 months of 2020. Meanwhile, revenues across its social media offerings reached 28 billion yuan, an uplift of 29%, and online advertising revenues also saw a healthy growth of 16% on the same quarter last year.

Aside from increased engagement with video games and social media on a global scale since Covid-19 hit, Ma Huateng, Tencent’s CEO, attributed some success to its ‘strategic organisation upgrade’ which was implemented two years ago. It also reflects the rebound in economic stability that China has experienced following its recovery from the worst of the pandemic.

Twitter’s ad revenue returned to growth in Q3 2020, up 15% year-on-year

Following a 23% decline in Q2 2020, Twitter’s ad revenue returned to a 15% year-on-year growth throughout Q3, totaling $808 million, according to its financial statement. These figures are in line with a general global uplift in social ad spending during the quarter ending 30^th September as many regions relaxed lockdown restrictions.

Monetisable Daily Active Users (mDAUs) grew 29% to 187 million – a healthy rate but slower than that which was seen in Q2 (+34% year-on-year), suggesting some normalising of summer usage after the spike caused by restrictions in the springtime. Meanwhile, total ad engagements rose by 27% year-on-year but cost per engagement dropped by 9%.

Looking ahead, the company seemed optimistic of its ad revenue for Q4: ‘October looks a lot like September with events and product launches coming back and we are benefitting from all of the hard work we’ve done to make Twitter a must buy for advertisers’. It also called the Christmas period ‘a buying season that may be accelerated and even more digital than ever before’.

Q2 2020:

TikTok reveals more than a 181m growth in global MAUs throughout H1 2020

TikTok divulged its user growth for the first time in late August as it filed a lawsuit against the US government over its potential banning in the region, CNBC has reported. The figures revealed that its global user base reached nearly 700m monthly active users (MAUs) in July 2020, a 181m growth since December last year. It is estimated more than 100m of those are based in the US.

The app’s biggest spike in global popularity occurred between January and December 2018, when it  first began its ascent to social media fame in the West, jumping from 54m to 271m MAUs. User growth has continued to rise at a healthy trajectory since; steepening slightly this year due to increased interest amid the coronavirus pandemic and marking an almost 800% rise in MAUs between the start of 2018 and July 2020.

This comes as findings from an IPA report confirm that the social media platform more than doubled its reach to 15-24 year olds throughout the coronavirus lockdown, up from 14% to 30%. Meanwhile, other social apps increased their reach to this age group only modestly; YouTube, for example, climbed just three percentage points to 63% during the same period.

Getting started with TikTok: A guide for marketers

Customer experience

Q1 2021:

25% of brands will see ‘statistically significant advances’ to their CX quality in 2021

As customer experience, particularly through online channels, was thrown into the spotlight for most of 2020, renewed focus on this core business aspect will enable vast developments throughout the course of 2021, according to predictions from Forrester.

Twenty-five percent of brands will see ‘statistically significant’ advances to their CX quality next year, despite budget cuts, thanks to increasingly improving customer experience competencies on the back of short-term fixes generated at the peak of the coronavirus outbreak. As a result, this move could save companies hundreds of thousands, or even millions, of dollars, the data forecasts.

Forrester also expects spending on customer loyalty and retention will increase by 30% over the next year, after acquiring plenty of new online customers during the 2020 ecommerce boom. Brands can expect to see their CMOs taking more control over the full customer lifecycle in order to improve CLV amid the uncertain financial climate ahead. Many CMOs are likely to integrate marketing with CX to create a more joined up experiences that encourage customers to stick around.

Q4 2020:

47% of British consumers have had issues with parcel delivery since the onset of coronavirus

An October 2020 survey of more than 2000 British consumers, commissioned by Citizens Advice, has found that nearly half (47%) of British consumers have had issues with the delivery of parcels since the first lockdown began in March.

With the UK having been in full or partial lockdown for much of this year, 51% say they feel more reliant on having products delivered to their homes. The increased numbers of people now shopping online, whether for necessity or convenience, seems to have thrown retailers’ logistical issues into the spotlight.

Of all respondents, a whopping 96% claimed to have ordered products that require parcel delivery since March. Three in 10 of these have experienced shipping delays, making it the biggest issue cited by consumers. A further 18% said they had lost out financially due to a home delivery gone wrong or missing, with 40% of those losing out by more than £20.

As a result, nearly one in four admitted they had lost confidence when ordering goods from online stores.

Citizens Advice has said views of its webpage providing advice on parcel issues had more than doubled to 208,000 between March and October this year compared to just 94,000 over the same period last year.

US shopping app downloads slowed to a 4% year-on-year growth in Q3 2020 after a Q2 spike

US shopping app downloads slowed to a 4% year-on-year growth in Q3, following a spike in Q2, according to Sensor Tower’s Mobile Retail Trends Analysis, published in Q4.

Across the Apple App Store and Google Play, shopping app downloads in the region surpassed 150 million. The ranking of most downloaded apps remained mostly unchanged throughout Q1-Q3 this year, with Amazon, Wish and Walmart remaining in the top three, in that order, as they did last year. However, three new retail apps entered among the remaining seven spots, mirroring their successes in the US market this year – Shop (by Shopify) rocketed to fourth place overall, while fashion retailer SHEIN ranked number seven and Nike crept in at number 10.

Sensor Tower data also revealed that US app download growth for top brick-and-mortar retailers between Q1-Q3 this year was almost double that of top online-only retail apps (+27% vs. +14%). Downloads for stores that also have a brick-and-mortar presence also dropped off less sharply over the Q3 period compared to those of online-only retailers.

This suggests US consumers found a new way to shop with their favourite high street stores in 2020 under unprecedented circumstances. Customers who favour flexible shipping policies and contact-free pickup particularly reaped the benefits of apps from these kinds of retailers.

Customer experience trends in 2021: What do the experts predict?

Workplace impact

Q4 2020:

46% of media, marketing and advertising freelancers in the UK say they are no longer constrained by the location of clients

Forty six percent of media, marketing and advertising freelancers say they are no longer constrained by the location of their clients, thanks to recent advances in remote working, according to research from Worksome, published in December 2020.

The survey of more than 500 UK freelancers in the sector also found 23% of contractors outside of the London area now work for companies that are based overseas, compared to 15% of those in London. However, almost half (49%) of respondents said they predict fewer jobs to be available from January due to the extra pressure businesses will be under from Brexit, on top of difficulties from Covid-19.

More than one in five UK workers have become freelancers throughout the course of the coronavirus outbreak, accelerating the trend of contracting becoming more widespread. Fifteen percent of these new freelancers said that the reason they moved to this type of work was because of redundancy where they used to work permanently.

For most, the change is set to be longstanding, with 83% stating they hope to continue working contractually after the pandemic subsides. The events of this year have also improved the general outlook of contractors. Fifty-seven percent said freelancing has been a positive thing for them during Covid-19, likely due to the flexibility it offers while juggling other responsibilities like childcare.  A further one in five have observed that there are more contractual jobs available since the workforce became less permanent, and an additional 37% claim they have been more productive when working.

97% of event marketers believe hybrid events are the future

Covid-19 has had a profound impact on the events business, eliminating crowded conferences and expos and forcing events organisers to adapt by shifting online. However, the outlook from the events industry is positive in the wake of this change.

Bizzabo’s Evolution of Events Report, published on 13th November and based on a survey of almost 400 event and marketing professionals, found that 97% of event marketers believe hybrid events are the future – and that going forward, the most rewarding events will have a virtual component.

More than 80% also reported greater audience reach from their events thanks to the shift to virtual technology, due in large part to the elimination of barriers to attendance such as travel, venue capacities, accommodation booking and other costs.

All of this has led to nearly a fifth of marketers (18%) reporting that they intend to increase their event marketing budget for 2021, with many already planning events for 2021 that will be supported by an online component. This widespread acceptance of hybrid events – and willingness to invest in them – is even more remarkable considering that 77% of respondents say they have never hosted a hybrid event before.

Q3 2020:

51% of UK marketers say they have lost in-house digital talent as a result of Covid-19

A September 2020 report from Serpico by Croud suggests that 51% of UK marketers have lost in-house digital talent as a result of Covid-19. Fifty-seven percent of these losses came from redundancy, 43% from furlough and 35% from those who had resigned from their roles since March. For larger UK businesses (those with 250-500 employees), the percentage that lost in-house talent during this period was as high as 61%.

UK businesses still perceive sigificant barriers to in-housing digital marketing, with 39% citing finding the right talent as a major barrier to in-housing, followed by budget cuts (38%). All in all, the future of sourcing digital talent for in-house teams looks to be as uncertain as ever.

Despite these significant losses and barriers, however, the report revealed that UK marketers are as keen as ever to move to in-housing digital talent at their organisations. Forty-nine percent of respondents said that they were planning on actioning this as a result of the pandemic, compared to a smaller 40% of those based in the US.

However, to mitigate issues down the line, not all of those hoping to switch to an in-house model are looking to do so entirely, at least for now. In the UK, 27% of UK marketers say they are planning to in-house marketing more as a result of Covid-19, but with the support of an agency; 11% plan to in-house their digital marketing less and rely on agency support, while 17% plan to increase in-housing and move away from agency support altogether.

57% of British workers want to continue working from home after the Covid-19 crisis subsides

Fifty-seven percent of British workers say they’d like to continue working from home, some or all of the time, once the Covid-19 crisis subsides, data from YouGov, collected in early September 2020, has found.

Before the outbreak began, 68% of the workforce never worked from home, while 19% did for some of the time and just 13% did full time. As has been reported frequently, Covid-19 has initiated a huge shift in flexible and remote working as a means of adapting. By early September, one third of workers were still working from home full time, even after the government encouraged the population to return to their physical workplaces. This number is likely to rise again now that restrictions and messaging have been revised.

The idea of striking a balance between office and home working is one that seems to appeal highly to British workers once things return to normal – whenever that may be. Thirty-nine percent of respondents said that splitting their time across the office and home would be their preferred option. Meanwhile, the same percentage specified that they would still opt to be based in an office or other physical workspace full time – 29% fewer people than originally worked this way before the pandemic.

Three quarters of staff who are working from home expect their employer to continue to offer this arrangement after the crisis is over. As a result, one in five of the British workforce say they would consider moving far away (non-commutable distance) from the office, rising to 28-30% of those currently based in London, and 22% would even contemplate moving to a different country.

Effective Remote Working for Marketers Best Practice Guide

Q2 2020:

Zoom has reported a 355% year-on-year rise in quarterly revenue during Q2

Video conferencing platform Zoom released its Q2 2020 financial results at the end of August, revealing that revenues were up 355% on the same quarter in 2019. Meanwhile, profit over this period rose to $185.7 million compared to $5.5m the year before.

The software gained popularity as a method for hosting virtual meetings during Covid-19 lockdowns when the ability to meet up physically became suddenly impossible on a global scale. It said that, by the end of the second quarter, it had approximately 370,200 subscribers with more than 10 employees – a staggering growth of 458% year-on-year.

As a result, Zoom have increased its revenue estimations for the year from $1.8 billion (originally forecast in June) to $2.4 billion, as fears of a second wave put off some workers from returning to office spaces. Sky News reports that shares in the company have risen fivefold in the wake of the coronavirus pandemic.

Entertainment

Q3 2020:

US daytime TV consumption by professionals working from home rose 21% year-on-year in October 2020

Insight from Nielsen indicates that US daytime TV consumption has climbed since workers have become accustomed to working mostly from home. In October alone, there was a 21% increase in time professionals spent watching TV (either live, time-shifted, via an internet-connected device, or on a game console) between 9am and 4pm – the equivalent of 26 more minutes per day than in the same month in 2019.

Data from an August Nielsen study on remote workers also found that 65% of remote workers in the region watched TV or streamed video content while taking work breaks, and a further 56% admitted to watching TV with sound when they were also working. Nielsen noted that while media habits have “normalised” since the initial shelter-in-place restrictions, daytime TV has become a “second primetime” and has skewed consumption, perhaps permanently if working from home becomes a more accepted norm following the pandemic.

By contrast, those not in the US workforce were actually found to have watched less TV in October 2020 than they did in October 2019, with declines ranging from 8% to 2% depending on the time of day. Meanwhile, children aged between 6 and 11 years old spent, on average, three hours and 25 minutes more watching TV during designated school hours. For children aged 12-17, there was an increase of two hours.

Marketers should take note of this trend and use their budgets wisely to target new audiences now watching far more TV than usual, and at significantly different times.

Netflix obtains just 2.2 million new subscribers in Q3 2020, a more than 67% decrease on the same quarter in 2019

After very strong performance in Q1 and Q2, which resulted in a total of more than 17 million new subscribers, Netflix obtained just 2.2 million new subscribers in Q3, it has said in a statement. The quarter beginning July and ending September is typically one of strong growth for the streaming platform, but these latest figures put it 67% behind subscriber numbers acquired during the same period of 2019.

Just 177,000 of these new subscribers came from the United States – one of its largest markets around the globe.

There’s likely to be a myriad of reasons for this dramatic deceleration in growth, including consumers wanting to spend more time outdoors over the summer season after a prolonged period of indoor confinement. Subscriber cancellations following controversy surrounding one of its shows, ‘Cuties’, could also have been a partial cause. In a statement, Netflix cited the theory that those who wanted to subscribe during the pandemic had already done so at its peak in the first half of the year – the ‘pull-forward’ effect it predicted in its Q2 financial statement.

However, the brand is now close to having obtained 200 million total global subscribers, well above that of rival Disney+ (estimated 60 million subscribers), despite disappointing Q3 results. Retention and overall new subscriber numbers across the whole of the calendar year were also up, it said.

Q2 2020:

Mobile app downloads rose 31.7% year-on-year in Q2 2020

The number of apps downloaded globally across the App Store and Google Play in Q2 rose by 31.7% year-on-year in Q2 2020 to 37.8 billion, a report from Sensortower has confirmed. Video conferencing app Zoom was the most downloaded app in worldwide between April and June, beating TikTok which ranked second. As a result, Zoom is just the third app in history that has surpassed 300 million installs in any one quarter, alongside TikTok and Pokemon Go.

Business, healthcare and educational apps thrived in Q2, while travel, navigation and sports apps suffered from a period of low installs. Rideshare apps Uber and Lyft experienced a severe decline in US installs and as of late June were still 57% and 59% behind pre-Covid levels despite many restrictions easing.

Entertainment apps also fared well – Disney+ took the number 14 spot in the US and entered the top 20 apps in Europe for the first time, ranking at number 15. Meanwhile, global mobile game downloads saw healthy growth, up 51.2% and 19.6% from Q2 2019 on Google Play and the App Store respectively. Popular app Roblox jumped from its number 11 Q1 ranking to number 2 in the US as shelter-in-place orders were enforced, while battle royale sensation Fortnite saw an 88% increase in US downloads quarter-on-quarter having newly released the game on Google Play in April.

Disney loses $4.7bn in revenue during Q2 2020, but Disney+ subscribers soar

Disney reported a $4.7bn drop in revenue for the quarter ending June, but Ofcom data has shown rapid uptake in its streaming service Disney+ thanks to Covid-19.

Between its launch in the UK (24^th March) and early July, 16% of online adults in the UK had subscribed to Disney+. The research has also confirmed that it has surpassed NowTV when it comes to subscription numbers in the UK, ranking it the third most popular SVoD in the country after Netflix and Amazon Prime Video. However, 95% of those who subscribe to Disney+ also have a subscription with at least one of these other two services, suggesting that Disney+ offers supplementary entertainment and will likely not replace them as an outright alternative.

In June, Disney+ was accessed by 32% of UK households containing children between the ages of 3 and 11, an increase from 21% in April, overtaking the reach of BBC iPlayer among this demographic, which fell from 26% to 22% during the same period. As a result, this proves Disney+ is continuing to gain momentum with families despite the easing of lockdown, and in some cases is replacing BBC children’s content.

Ofcom data also found that consumers were on average spending 1 hour and 11 minutes per day on SVoD services in April 2020, which is 37 minutes higher than figures recorded in April 2019.

Digital Transformation Monthly – 2020 in Review

Employment & recruitment

Q3 2020

Google searches for digital marketing courses saw three-digit growth during lockdown

New data from SEMrush shows the number of global Google searches for the term ‘online digital marketing courses’ grew 110% (rounded) in the period February-July 2020 compared with numbers from August 2019-January 2020. The figure rises to 132% in the UK, suggesting a large proportion of the workforce in the sector were looking to improve their digital marketing skills over lockdown.

Queries for Google-run digital marketing courses (‘Google digital marketing course’) were particularly high in the UK compared with global averages, seeing 168% growth in the search term vs. 86% growth elsewhere. This could indicate UK marketers’ perception of Google as an expert authority and influence on the subject when matched against other training providers.

Demand for similar digital marketing courses was highest in Canada, Australia and the UK over this five-month period, while equivalent search queries in the US remained relatively low.

(See Econsultancy’s online digital marketing courses)

Q2 2020:

46% of UK marketers ‘very’ or ‘fairly’ worried for their jobs

Nearly half of UK marketers are worried for their jobs, according to a June 2020 survey conducted by YouGov. In a study of 1178 marketers, 16% said they were ‘very worried’ that they will lose their job as a result of the ongoing coronavirus outbreak, while an additional 30% said they were ‘fairly worried’. Just 15% of marketers claimed they were ‘not at all worried’ about their job security, compared to 27% of other workers.

These figures are significantly higher than those from the rest of Britain’s general working population, of whom 10% and 21% are ‘very’ or ‘fairly’ worried about their job security, respectively.

So far, one quarter of marketers have been placed on furlough for at least part of the pandemic. While some have since returned, there continues to be heightened concern about financial security from employees in this industry. Sixty-two percent fear that their personal finances will be severely affected, in contrast to 46% of those in other sectors, as the UK economic outlook remains uncertain. Meanwhile, they are also more worried about being able to keep up with mortgage repayments than the rest of the UK workforce (38% vs 30%).

Large numbers of business leaders from YouGov’s wider B2B survey admitted that they had cut the budgets of their marketing functions, with more than a third claiming these cuts were severe. As a result, marketers appear to have felt the impact of Covid-19 – or believe they will feel it in the near future – more than most.

Retail & FMCG

Online as a share of total retail in the UK reached 33.8% at its peak in 2020

The ONS has revealed that, online sales as a share of total retail (excluding fuel) reached 33.8% in May 2020. This figure dipped to 27.6% by September when non-essential brick-and-mortar shops had mostly resumed trading. Pre-Covid, February 2020 saw 20.1% of total retail transacted online.

Since local and national lockdowns began being reintroduced in Autumn 2020, online sales grew once again, up to 28.5% in October and 31.4% by end of November 2020.

Stats roundup: the impact of Covid-19 on ecommerce

Q4 2020:

UK footfall down 29% year-on-year as non-essential shops reopened after November lockdown

The Retail Gazette reports ShopperTrak’s findings that UK footfall on the first Saturday after England’s November lockdown was lifted (5^th December 2020) was still down 29% year-on-year, even though week-on-week shopper traffic increased 193%.

Further data, this time from Springboard, indicates that footfall across all retail destinations in the first week after the November lockdown ended was 41.3% down on the same week in 2019, rising to a 51% drop on high streets and a 45.6% drop in shopping centres. However, the number of shoppers visiting dedicated retail parks declined by just 1.3% on last year.

72% of British shoppers think that retailers should offer more promotions in a time of financial uncertainty

Seventy-two percent of British shoppers think that retailers should offer more promotions in a time of financial uncertainty, such as the pandemic, according to a December 2020 report from XCCommerce, ‘Promotion at the speed of customer demand’.

The survey of 2000 consumers also revealed that more than half of consumers (56%) in the region believe it is the most important factor when they shop, rising to 70% among those aged between 18 and 24. A further thirty-two percent of respondents said they have been researching offers in 2020 more than they were last year.

With 60% of consumers spending less this year due to Covid related financial troubles, brands have to provide shoppers with smarter and more aggressive discounts to encourage them to part with their cash. It seems that customers are more likely to prefer immediate-term discounts than those that offer long term perks for their loyalty. The most popular form of discount cited by those surveyed was money off specific products (78%), followed by free shipping (55%) and multi-buy discounts (46%). However, access to members only discounts (15%), a subscription service offering money off future buys (10%) and access to exclusive content (9%) were ranked the least popular.

Despite a large appetite for discounted products, brands must be careful not to overdo promotional communications. Forty-four percent of customers say they resist the temptation to buy additional products recommended to them (e.g. ‘customers who bought this also bought’), while another 46% say that over-communication of current offers puts them off from making a purchase.

Grocery supermarkets are seen as the most generous discounters by consumers, and even more so in the eyes of the 55-64 year old age bracket. Meanwhile, just 8% believe fashion retailers offer the best promotions, increasing to 19% for 18-24 year olds.

UK October 2020 retail sales up 5.8% year-on-year as second lockdown loomed

ONS data found a 5.8% growth in the volume of retail sales in October 2020 compared to the same month a year before. Retail sales volume also increased by 1.2% on September, continuing the industry’s trend of steady recovery seen over the last six months.

These figures suggest UK consumers began their festive shopping much earlier than usual, spurred on by heavy discounting by retail stores and perhaps by rumours of an impending second lockdown in November.

Non-store sales volume rose month-on-month for the first time since June, and were 44.9% higher than in February, pre-Covid. Meanwhile, sales in sectors such as household goods, non-food, food stores and department stores all continued to recover above their equivalent February numbers, but at a much lower rate. Clothing, however, notably stayed lower than pre-Covid levels, hampered by tightening local lockdown measures on non-essential stores.

78.9% of clothing and 66.7% of department stores saw a decreased level of footfall during the two weeks from 5th October to 18th October 2020, resulting in the increase seen in online spending. Overall, online sales as a percentage of all retail reached 28.5% in October – an uplift of 4.7% month-on-month.

Q3 2020:

Asda gearing up for a “record online Christmas” as it publishes Q3 results

Asda reported that it is gearing up for a “record online Christmas” as it published its Q3 results for 2020, which included a 72% year-on-year increase in combined net sales for Asda.com and George.com.

Overall, Q3 like-for-like sales (excluding fuel) increased by 2.7% year-on-year, the supermarket chain reported, with growth driven by strong performance in grocery, back to school clothing and online shopping. Asda is already seeing a surge in demand for Christmas products and essentials, including Christmas trees, sales of which are up by 83% year-on-year; festive lights, which are up 57%; and Christmas puddings, which are up 71%. Sales of frozen turkey crowns, which serve three to four people, have also increased 230% year on year, indicating that consumers are planning for smaller gatherings during the festive period.

Asda is responding to the continued demand for online shopping by increasing the capacity of its grocery delivery service to 765,000 weekly slots. It has also expanded its delivery trial with Uber Eats from 50 stores to 100.

M&S posts a loss for the first time in 94 years

British retailer Marks and Spencer has posted a loss for the first time in 94 years. In the six months to the end of September, the company made a loss of £87.6 million versus a £158.8 million profit during the same period of 2019.

Sales fell 15.8% between March and September, mostly impacted by the lack of sales in its clothing and homeware departments. Even food sales struggled, seeing a 20% decline on budget during the four months to July, which hit overall annual revenue by £348 million. However, total food sales rose by a modest 2.7% overall during the full six-month period, boosted by the performance of its standalone Simply Food stores.

There was a slight rise (1.8%) in the number of clothing and homeware sales conducted via its ecommerce arm, but this was not enough to offset the losses from the prolonged closure of 600 of its brick-and-mortar shops in the first lockdown.

However, Ocado, the online grocery store which began delivering M&S produce in September 2020, reported a 47.9% sales growth in the six months to the end of August.

Footfall down 3.5% in shopping centres in week to October 17^th 2020 as local lockdowns are enforced

The number of shoppers travelling to physical UK retail destinations has fallen for a fourth consecutive week, according to data from customer activity specialist Springboard, reported on by Reuters. Further local lockdown restrictions have been enforced to subdue a second wave of the coronavirus this coming winter, which in some cases includes closing pubs and restaurants in particularly badly-affected areas, providing consumers with even fewer reasons to visit town centres and shopping complexes.

In the week to the 17^th October 2020, footfall on UK high streets and retail parks fell by 2.8% and 3% respectively on figures from the week before. However, it was shopping centres that fared the worst, seeing a 3.5% decline during this period.

Unsurprisingly, it was regions of the north that felt the biggest hit as restrictions became especially strict in areas like Manchester and Yorkshire. Footfall in many of these areas dipped by around 5% week-on-week. In total, the decline in shopper numbers across all retail destinations around the UK worsened to 32.3% year-on-year.

This comes alongside news that a record 11,000 UK shops have been permanently closed as a result of the ongoing pandemic so far this year.

80% of brands do not have a loyalty programme in their marketing strategy

Despite droves of online shoppers switching between brands this year, as many as 80% of organisations still do not have loyalty programmes integrated into their marketing strategies, October 2020 research from Dotdigital confirms.

A further 43% of companies with an ecommerce arm fail to collect enough key customer data, such as date of birth, to offer them crucial personalised messaging, while 40% admitted they don’t publish post-purchase reviews – a key purchase driver. An additional two-thirds of those surveyed failed to send editorial marketing communications, which help to highlight the value of a brand and its products.

Consequently, numerous companies are missing out on the opportunity to acquire repeat online business from these new customers, whether from lack of loyalty to a brand, irrelevant content or not enough social proof on display from past shoppers.

According to the data, 38% of consumers are keen to acquire brand credit with actions outside of buying products, for example writing reviews or interacting with social accounts. Interestingly, thirty-nine percent only consider themselves ‘loyal’ to a company after completing a fifth purchase, but with the majority of brands not making the effort to incentivise engagement, they have little reason to stick around.

Tesco’s pre-tax profit surges 28.7% year-on-year

Tesco’s 2020/21 interim results released in October 2020 indicated a 28.7% year-on-year surge in pre-tax profits for the company in the 26 weeks to the end of August in what has been a landmark year for the grocery sector.

Food sales rose by 9.2%, but interest in its clothing line F&F fell, resulting in a 17.2% drop in sales for this category. Average basket size in large stores grew by 56%. Unsurprisingly, fuel sales fell by 42% on 2019 as the general public were encouraged to stay at home throughout national lockdown in spring and early summer. The brand also said it had so far spent £533 million on Covid-19 safety measures for its staff and customers throughout the pandemic.

Online delivery capacity doubled to 1.5 million weekly slots as a result of heightened demand at the peak of the coronavirus outbreak in the UK. It also revealed that it had served 674,000 vulnerable or shielding customers so far.

Meanwhile, operating profits fell by 15.6%, largely due to Tesco Bank which made a loss of £155 million during this period.

Tesco’s new Chief Executive, Ken Murphy said in a statement, “The first half of this year has tested our business in ways we had never imagined, and our colleagues have risen brilliantly to every challenge, acting in the best interests of our customers and local communities throughout.”

Tesco on experience and purpose during a pandemic

Ocado named 2020’s fastest-growing UK brand

BrandZ has named grocery chain Ocado as the UK’s fastest growing brand in its annual Top 75 Most Valuable Brands report.

The company jumped 16 places in the Top 75 list in 2020.

For more on coronavirus and marketing, visit Econsultancy’s coronavirus hub page.