Adtaxi, one of the country’s fastest-growing digital marketing agencies, today released the results of its latest report, Understanding Buyers and Effective Ad Spend in the COVID Economy.
Polling 65 companies, the survey shows how businesses tightened their belts at the height of the crisis: whereas 54% used a third party for media buys in Q4 2019, this percentage dropped to 45% during Q2 and Q3 2020. Signaling a return to pre-pandemic levels, companies reported an even split between in- and out-of-house media buys for Q4 2020.
“Because of the economic hardships suffered at the peak of the pandemic, it comes as no surprise that some companies sought to cut costs by handling media buys in-house,” said Murry Woronoff, Director of Research, Adtaxi. “However, the recent trend toward pre-pandemic numbers for third party marketing suggests a clear vote of confidence in the ongoing value that these partners provide.”
Among the survey’s additional takeaways:
- A new normal: 8 in 10 agree that COVID-19 has changed their company’s advertising strategy for the foreseeable future
- Winners and losers: Over the past six months, only digital posted a net increase in ad spend, with 55% of companies increasing budgets and only 25% decreasing. Cable was the most negatively impacted, with a net 88% decrease in spend.
- Tools of the trade: Over the past six months, performance data (55%), news articles (43%) and webinars (41%) were the most-cited resources impacting decision making.
- Future focus: In the next six months, social will see the highest net increase in ad spend at 55%, followed by video at 46% and search at 44%. Only native registered a negative net increase at 6%.
One-third of companies surveyed were in the Marketing & Advertising category (i.e. advertising agencies). Over the past six months, these media savvy professionals were nearly twice as likely to push larger shares of their ad budgets to digital – 40% versus 24%.
Regarding the next six 6 months, these same marketing professionals plan to increase spend specifically to Social and Audio, where other businesses are looking to increase spend on Display and Search .
“When companies made cuts to ad spend at the beginning of the pandemic, they also showed where they were most confident in a return on investment – and that’s in digital,” continued Woronoff. “Still, even within digital, the difference in decision making between agencies and other businesses shows the challenge of keeping up with an ever-changing media landscape. In an environment that will likely undergo continued dramatic shifts, the ability to react quickly and plan a resilient and adaptable media strategy can not be underestimated.”
For the ‘Understanding Buyers and Effective Ad Spend in the COVID Economy’ report, Adtaxi surveyed 65 marketing professionals, each from a different company. The survey was conducted via email between August 6, 2020 and August 21, 2020.