According to trends’ forecasts, the year 2020 was supposed to be another good year for e-commerce. As much as it is not far from reality, no one has expected that the situation would take such a turn in favor of the digital advertising industry. Check our conversation with Bruno Iglesias, Head of Performance at Performante, in which he talks about the most visible trends that the ongoing situation brings to performance marketing industry.
We’ve been functioning in the pandemic situation for a month already. What are your main observations? How the industry reacted?
Internally, it’s definitely harder for the team to collaborate at a distance, but I think the industry is a digital one by definition and, therefore, cooperation with our external partners continues as smoothly as it ever was. The general impact is that everyone, from publishers to advertisers, has to work faster because the market is flooded with demand. But the nature of the work is the same.
It is only a quarter into 2020, so not long ago the whole industry was making predictions for that year. How this year was supposed to be like?
We expected another good year for e-commerce, with an increased participation of the social channels — “shoppable” posts, messaging, micro-influencers, niche social outlets… all of these are on the rise. Of course, we should not forget about subscription-based services, such as VOD platforms, that continue to grow in popularity.
Speaking specifically about the video-on-demand universe, the market gets more dynamic by the year. We have seen the birth of different streaming services over the past few years and the shift from cable to wifi has become the standard. All of this translates into challenges for the advertising industry, but challenge breeds improvement and so 2020 is supposed to be a year for diversifying and bettering promotional strategies.
Coronavirus outbreak came unexpectedly and the whole marketing industry had to adjust. After almost a month of the ongoing situation, you might already have some observations.
Sadly, the effects of the pandemic have a crushing impact on many businesses, but many online verticals have been lucky enough to see their volumes grow as an effect of social distancing and the lockdowns. There are reports pointing to an increase of 50% on consumption of online news by millenials and of over 30% on online shopping. We see also an increase in purchases of streaming entertainment as high as 82%.
Are there any important trends that you observe right now?
Clearly an increase in demand for indoor activities — anything that helps passing the time while staying safe.
Any particular examples?
As we work with 100-percent online products, we are seeing an increase in demand for the past month, with so many people at home looking for movies, series, home workouts, relaxation techniques, and language courses to pass the time, all of which we promote as subscription-based services. It’s got to be way harder for other businesses, even online ones but reliant on an offline deliverable, such as e-commerce. Big players suffer less from it — and often even boost sales — but think about the small online stores that depend on external warehousing, sourcing, and shipping services to fulfill their orders when most countries have strict rules on transit at the moment.
Do you think that we will be able to learn something from the ongoing situation? Will it have a long-lasting impact on the performance marketing industry? Maybe some priorities are shifting right now?
For sure. I believe big parts of our lifestyle are subject to a change after this situation is passed — in our work dynamics, office space, shopping, and entertainment activities, to name a few. But, in the performance marketing industry specifically, I don’t expect any dramatic impact other than the naturally increased standards that stay after companies go through such a period of more intense competition. I hope we all come out of it with something we have learned.
How will the industry look in the upcoming months?
We will probably need to get used to not-so-high levels of demand again but, as I mentioned earlier, I don’t think this crisis has a shifting impact in the performance industry, which takes place essentially in a digital space and didn’t see its paradigms change over the past few weeks. I do hope that all industries that are experiencing growth in volumes during these times also show a development of its best practices and come out of it more mature and professionalized.