Coronavirus and Mobile Advertising: CPMs, Sensitivity, Geographic Comparisons

The Covid-19 crisis is a challenging time for all industries, but for mobile marketers it poses a paradoxical challenge. On the one hand, people are on their phones and engaging with media as much as ever. On the other hand, the economic downturn is putting a strain on marketing budgets, employees are working from home, and messaging during a public health crisis requires unusual sensitivity.

Brian Bowman, CEO of social marketing and user acquisition firm Customer Acquisition, provided Street Fight his takes on the current state of the mobile ad market, where it’s headed in the coming weeks, and how advertisers can approach their work with consideration for the difficulty of these times.

How has the Covid-19 outbreak affected mobile advertising spend, especially CPMs and ROI?

Given the impact of the pandemic, we believe certain genres of advertisers from hospitality and travel to luxury retail are pulling out advertising dollars. As such, we’re seeing an unprecedented decline in CPMs in regions where shelter-in-place orders have taken effect.

We’re advising mobile app advertisers to take this opportunity to increase mobile advertising spend through Q2, while we expect CPMs to stay lower than the previous averages.

How do changes in countries where there is more data (e.g., Italy) shape your understanding of changes coming to the US market?

The impact of Covid-19 on Italy started several weeks sooner than other regions, and so we’ve been able to leverage learnings from the Italian mobile ad marketplace to forecast CPM reductions about to occur in other geographies where we expect new shelter-in0place restrictions to occur in the future. In the US, shelter-in-place has been rolling out on a state-by-state basis, which allows for additional geographic segmentation and time offsets.

How should mobile advertisers approach the current mobile ad market?

From a media buying perspective, mobile advertisers should increase mobile ad spend to close out Q1 and front load as much ad spend as possible into early Q2. If CPMs normalize in a few weeks, at least you’ll have captured market share and net profit while it was available.

Otherwise, if the current shelter-in-place protocols last for 10 or more weeks across several regions, these reduced CPMs for mobile ad buying opportunities may last all the way into early summer.

What should advertisers keep in mind regarding the sensitivity of this time as the world faces a public health crisis and an economic downturn?

During this uncertain time, people are probably looking for an escape from what’s going on, so advertisers should consider softening their creative strategy.

We suggest developing advertising creative that is upbeat, positive, and respectful, while showcasing your products as providing stress relief during the current situation (perhaps as an alternative to the news). We also recommend avoiding direct mentions of the pandemic in general, steering clear of offering medical advice, and refraining from creating ads that some people might consider offensive or aggressive.

Tags:
Joe Zappa is the Managing Editor of Street Fight. He joined Street Fight as a contributing writer in 2015, has compiled the daily newsletter since 2016, and has spearheaded the newsroom's editorial operations since 2018. Shoot him an email at jzappa@streetfightmag.com.