E-Commerce Advertising Recovering Quickly Despite COVID-19

While e-commerce businesses were not completely immune to the impact of the coronavirus pandemic and spread of COVID-19, advertising spend and performance has surged as of late.

COVID has challenged everyone, and not one industry has not felt the effects in one way or another. From the shuttering of small businesses around the globe to people being forced to “shelter in place,” the significance of the coronavirus pandemic can only be described as on epic proportions.

Yet, what most marketers will agree with is that the e-commerce industry as a whole has actually benefited from the global health crisis in more ways than it has suffered.

Now that the initial “shock point” of COVID-19’s impact on many e-commerce businesses is becoming more of a distant sight in our rear views, we’re seeing a massive surge in not just advertising spend, but also incredible gains in performance.

Here is what we are seeing…

Mid-March: A Small Reckoning

January and February are often considered a “recovery” period for e-commerce businesses as they begin to regroup and recap after the holiday selling season – fueled by Black Friday and Cyber Monday which has become more of an entire week of surging numbers in traffic and sales for online stores.

Store owners and admins are likely occupied with planning their new year’s plans, potentially dealing with a swath of returns, and all while looking back to see what they can do better in the next 365 days.

Then came coronavirus.

Early March saw some merchants pull back from their advertising spend, yet for every 1 store that had to pause or even close down due to local mandated shuttering of non-essential businesses, 3 stores experienced surges in traffic and sales – some to the point of completely running out of inventory:

COVID-19 E-Commerce Impact

Source: S&O internal data on over 14,000 online retailers globally

April: Things Were Looking UP

Across all channels, starting as early as March 26th, everything from impressions, clicks, conversions, sales, and spend on Google and Bing Shopping ads and Facebook and Instagram product ads began a substantial upward trend.

Fueled by high performing verticals such as Auto Parts, Home & Garden, Fitness, and Pet Products – it was clear that shopper behavior shifted tremendously in the face of COVID-19.

Over 1 billion additional product ads were served over the course of a single month and shoppers began to click through to e-commerce stores at a heightened rate:

COVID-19 E-Commerce Trends

Source: S&O internal data on over 14,000 online retailers globally

Looking to the future, product ads will undoubtedly lead performance for e-commerce merchants, and far more so than other advertising types – a trend echoed in our recent webinar with our SPM team at Google for Shopping, all on the impact COVID-19 has had on US search trends.

The drop in early March at the start of the pandemic could be seen as the catalyst for recovery we are seeing now from the beginning of April as Shopping ads on Google continue to prove themselves against other ad formats in click volume:

Google Shopping ads versus Text Ads

Source: Google search US only, Google Shopping SPM

What Lies Before Us

All in all, things are really shaping up to a very positive outlook for e-commerce businesses, both domestic and abroad.

Still though, much uncertainty still remains in the world. Here in the US, the impending reopening of the economy is as horrifying as it is exciting.

Just as governments should, as marketers we can only rely on data to support our decision making. Right now, the data is, in an odd way, a bit nourishing and online retailers should be looking to take advantage of every opportunity (both “old” and “new”) to carry them into the future.

Google’s New Free Shopping Listings (US Only)

The latest way to augment the reach of your brand and products on Google, any US online store owner with a Google Merchant Center account could be automatically eligible for free product listings on the Shopping tab on Google.

Free Google Shopping Listings

The program, Surfaces across Google, essentially turns your product feed into organic product listings that drive free traffic to your online store.

YES! FREE! Now referred to as “Unpaid clicks,” these listings are the perfect supplement to both Shopping ad campaigns and Shopping Actions on Google.

Microsoft’s (Bing) Growing Retail Market Share

Don’t put all your eggs in, Google’s basket? Diversity in your omnichannel marketing strategy is crucial for:

      1. Reaching new shopper audiences
      2. Attracting more traffic to your online store
      3. Generating additional, profitable return on advertising spend

One of the more important go-to channels is Bing or Microsoft Advertising with the use of Shopping campaigns just as you would in Google Ads.

As of December 2019, leading cross-channel data and analytics aggregator Comscore recorded that Bing controlled nearly 40% of the retail paid search market share online:

Microsoft Paid Click Share

What’s more, most retailers either do not understand or simply do not realize the depth and breath of the Microsoft Advertising search partner network – IT’S NOT JUST BING ANYMORE!

Among these search partners are other surfaces such as Yahoo! and AOL.

Microsoft Advertising Search Partner Network

Facebook & Instagram Drive SERIOUS Results

If you are not leveraging retail solutions and product advertising on the world’s largest social media network then you are just leaving money on the table.

When we look specifically at Dynamic Product Ads, we see a wealth of opportunity to increase product reach and drive more profitable revenue for e-commerce businesses.

Dynamic Ads on Facebook are capable of displaying either single product images or a carousel style of images. The products displayed are automated using Facebook Machine Learning algorithms to ensure the most relative products are displayed to the proper audience:

Facebook Product Ads

Because Instagram is a mobile-bound shopping experience, the ads displayed are geared towards that type of engagement. Typically only a single image format is displayed:

Instagram Product Ads

When properly set up and managed, these ad formats can win you the social shelf space and bring about substantial results for your e-commerce business. Just look at how our customer BB Wheels saw a massive lift in profitable revenue just from Facebook alone.