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Adjusting Ad Spend During a Pandemic

Updated: Sep 1, 2020

A lot of things has changed in the last 6 months, more than we could ever imagine

The last few months have been painful for all of us. From losing Kobe in February to not being able to be around friends and family, and people losing their jobs left and right. 2020, has been the year to forget.

One of the biggest changes that have come about during the pandemic is ad spending. Businesses have undergone massive cutbacks in how much they're spending on marketing since the pandemic hit. Some industries have been more heavily affected than others. For example, travel and restaurant have both been affected the most due to social distance guidelines and stay-at-home orders by local governments.

This doesn't mean that just these industries should start re-evaluating their ad spend budgets, but other industries should also start re-evaluating their budgets as well over the next 12 months minimum. No one knows how long the pandemic will, so it's important that businesses start planning for the future and ask themselves these following questions.

What assumptions did you make about your priorities heading into 2020?

How has the global pandemic and economic recession affected those priorities thus far?

  • How have your trends changed and what shift(s) have you already had to make?

  • How has the pandemic affected your priorities and budget so far?

  • What shifts in behavior did you have to make or planning to make?

Once you're able to answer these questions, you'll be in a better place to create a paid digital budget in this pandemic. The most difficult part is how do you make these changes and plan for the future.

In order to be successful, you need to consider what goals are more important to you at this time.

1. Drive sufficient sales volume even at the expense of profitability.


2. Maintain a profitability margin even if it means losing out on sales volume.

Obviously, you can't pick both goals. We all want to drive more sales and increase profitability, but at the moment that's not really feasible. If you try to achieve both goals, you could end up missing them both. So, you want to pick the one that you know you can achieve, and as time goes on, steadily add more goals.

Focusing on sales volume

If your goal is sales volume, reference the year-over-year trends you’ve witnessed since the COVID-19 outbreak and the onset of the recession. Go back and look at the last few months since things have started returning to a “more normal” outlook with regards to businesses reopening.

For instance:

  • Have you seen website traffic bounce back a bit since May, but not sales or conversions?

  • Have you noticed notice changes in some channels but not others?

  • Has your ad spend correlated to the shifts in conversions?

Focusing on profitability

If your goal is profitability, reference the same questions as above. You should pay close attention to the last two to three months as the pandemic has sent the world into an economic recession and begin for the long haul. You should plan for these year-over-year trends to continue. Also, take into account seasonality, forecast what your campaign budgets should be by month or by week given your desired ROAS or ROI levels.

As we're still in the early stages of reopening in some areas and still face a vast amount of uncertainty, remain agile, and be ready for change. You could end up doing more forecasting before we reach the end of this pandemic.

Remember you're not alone in this and it could be some time before things get back to "normal".

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