Interviews, insight & analysis on digital media & marketing

The true extent of the pandemic shift to digital

As you may have heard, the COVID-19 pandemic has accelerated the consumer shift to digital media, with activity increasing across all areas of the online world. Ecommerce has exploded in growth, social media has witnessed user expansion and increased brand investment, online video has lured big budgets away from linear TV, and gaming experienced a rapid increase in sponsorships and monthly viewers.

Hey big spenders

Online retail spend increased by a staggering $900bn last year, per WARC’s latest ad trends report, citing the Mastercard Economics Institute. This influx led to brands growing investment in ecommerce advertising ahead of the wider online ad market.

Even as stores reopen and footfall increases, data from Earnest Research shows that 59% of the customers acquired by Amazon over the course of the pandemic were still buying with the ecommerce giant at the end of 2020, which represents the highest retention rate in US retail.

Equally, there has been a growth in popularity of ‘click and collect’ services, showing consumers appreciate flexibility and a close relationship between the online and in-store experience.

It all starts with TikTok

The big winner in the social media space has been TikTok, which has overtaken Facebook to claim the highest levels of user activity in Canada, France, the UK, and the US, according to App Annie.

Meanwhile, WARC’s own research found that 44% of brands expect to increase their spend on TikTok this year, ahead of 39% on Facebook.

On the tube

Online video was slowly but surely eating away at linear TV before the pandemic. However, in the past year, linear TV advertising has slipped an estimated $34bn, with online video now claiming 26% of the global video ad market.

YouTube’s audience consumes over 20 hours of mobile content each month on average and 27% of consumption is now via connected TV devices, presenting a huge problem for linear TV.

Consumers, however, don’t have any platform preference – caring more about the quality of content than anything else. 20% of global consumers see no difference between YouTube and linear TV consumption, according to AudienceProject. In the US and UK, this proportion sits at 36% and 27% respectively.

Game on

In the gaming world, Twitch is approaching three million monthly viewers around the world. And, according to GlobalWebIndex (GWI), these viewers are 7% more likely to buy from brands they have seen advertised.

Equally, Newzoo forecasts that esports sponsorship will cross the $600m mark for the first time this year, growing 11.6% in the process.

In spite of this, 35% of marketers are not placing a higher focus on gaming in 2021.

“The media disruption from COVID-19 was rapid and severe, but the data suggest that brands were largely able to adapt to the immediate shifts in consumer behaviour. The clear correlation between changes in user activity and advertising spend shows how digital media has benefitted,” said Rob Clapp, Senior Analyst at WARC Data.

“The main takeaway for brands has been a greater focus on agility, innovation and effectiveness, a trend that is likely to perpetuate digital media’s rapid growth in 2021 and beyond.”

Screens over social

Research produced by WARC, in collaboration with GWI, found that 34% of consumers find TV ads ‘entertaining’ and 30% ‘informative’, compared to 17% and 19% respectively for social media ads, showing a preference for TV over social media.

Furthermore, younger audiences tend to connect with ads on an emotional level, while their older counterparts tend to look for product information. Equally, younger audiences are more easily distracted, with 49% regularly switching between multiple smartphone apps.

The research also found that 53% of consumers feel an excessive number of ads negatively impacts their view of a brand, but the largest consumers of digital media are also the most resistant to targeted advertising anyway.