Social Media Use During Covid-19
According to the World Economic Forum, the Covid-19 pandemic caused a decline in advertising spending. According to Nielsen's report, people in the United States spent 215% more time reading news online in the wake of the Covid-19 pandemic. A survey conducted by the World Economic Forum showed that 16% of consumers pay for news on social media, and 53% would consider buying news in the future.
Impacts of the Covid-19 Pandemic on the Advertising industry
Change in Revenue and Ad Spend
- The ad market was $646 billion in 2019 and was expected to grow to $865 billion by 2024 before the pandemic. According to the Interactive Advertising Bureau, around 24% of planners, media buyers, and brands paused spending until the end of Q2 2020, and 46% of them stated they would adjust the ad spending. The net investment in advertising is expected to grow at -7.2% in 2020.
- Due to the decrease in sales, advertising firms and PR agencies have laid off its staff. Havas, an ad holding company, laid off 200 employees in the wake of the pandemic due to clients reducing ad spend. Samsung canceled an $845 million United States advertising business because of the Covid-19 pandemic.
- According to Nielsen Ad Intel, the Covid-19 pandemic is expected to cut around $50 billion in advertising investments in 2020. The global advertising trade's projected value will be $563 billion in the same year (2020). The global ad spending in the Telecoms & utility sector is expected to grow by 4.3% amidst the pandemic.
- However, the global ad spending in pharma & healthcare has declined by 2.3%. The media and publishing sector ad spend has reduced by 5.8%, household & domestic by 6%, alcoholic drinks by 8.8%, automobile by 11.4%, retail by 15.2%, clothing & accessories by 11.1%, and 18.2% in the finance industry. According to the WARC report, ad spots have become cheaper due to a lack of demand for media buys.
A Shift in Advertising platforms
- The stay-at-home directives resulting from the pandemic caused a decline in the out-of-home (OOH), cinema, and print advertising. The use of digital channels by consumers increased, and so did digital advertising.
- Cinema advertising revenue will drop by 42%, print advertising by 32%, and OOH advertising will decline by 22% in 2020. Around 97% of marketers have observed low in-person marketing engagement.
- According to eMarketer, radio advertising in the United States is expected to decline by 25% in 2020. However, the report suggests that radio advertising will pick-up in 2021 to reach $12.18 billion.
- According to a survey by Smartly.io, consumers are more engaging with advertising on social media. One-third of consumers are more receptive to adverts with relevant messaging, useful during and post Covid-19 pandemic. Around 38% of social media users are now more open to engaging with ads on social media.
- In the United States, 29% of consumers prefer photo ads, 26% prefer video ads, 14% prefer story ads, while only 3% prefer messaging ads.
- Globally, 34% of consumers like to see brands address the pandemic with relevant messaging like the "social distancing" advice. In comparison, 44% engage with ads that offer products useful in the "stay-at-home economy." Around 16% of consumers would like brands to stop advertising completely, while 32% want to see ads that promote philanthropy acts like helping communities affected by the Covid-19 pandemic.
- The 30-second ads are more dominant in the social advertising space, with a 79% share of impressions. Mobile in-app ads provided more impressions of 26% than ads on the web, which comprised 12%.
Social Media Engagement
- According to a survey, 74% of brands post less on the company social accounts since the Covid-19 pandemic because most businesses closed up shop. About 34% of firms shifted their social time from Instagram to Twitter.
- Instagram Live usage has increased by 50% during the Covid-19 pandemic. According to the Pew Research Center, 68% of Americans actively use Facebook, and 73% use YouTube.
- Around 17% of internet users in the United States spend more time on messaging services like Whatsapp and Facebook Messenger since the Covid-19 pandemic, while 32% are spending longer on social media. As of March 2020, 6% of internet users in the United States spent more time creating and uploading videos on YouTube and TikTok, while 10% listened to more podcasts. Since the beginning of the pandemic, 18% more consumers have listened to radio globally than before.
- Social media users now spend an average of 2 hours, 24 minutes a day across an average of eight social networks and messaging apps. Out of the 4.57 billion internet users globally, 346 million joined social channels during the Covid-19 pandemic. There are 3.96 billion active social media users globally, and the number continues to grow at 10.5% annually. Around 3.91 billion social media users access the platforms through mobile phones.
- The most popular social media platforms are Facebook, YouTube, WhatsApp, Facebook Messenger, and WeChat. On Instagram and Facebook, most followers on brand pages are females aged 25 years to 34 years old. Around 79% of people aged 30 years to 49 years old use Facebook.
- Around 46% of consumers aged 35 to 44 years old research products online through social networks, while 26% buy products based on the number of likes/comments on the social media post. According to GlobalData, 27% of social media users plan to spend more time browsing, while 22% expect to post on social media actively in the future.
Trends in Social Media Marketing
Use of Chatbots and AI
- Chatbots are becoming a trend on social media and have made it simple for customers to reach out to brands through social media. Chatbots make it efficient for brands to respond to client's questions/concerns quicker. Brands use AI to determine the consumers' needs, to promote targeted marketing on social media.
- Chatbots, powered by AI, are being utilized by brands on Facebook Messenger by brands to promote products and resolve customer concerns. Chatbots can also help with scheduling meetings and collecting leads. Due to progress in AI technology, more brands are considering adopting this method of customer service to boost customer experience and customer satisfaction.
- Influencer marketing is a growing trend in social media marketing, given that most people spend time on social channels than on reading print media. Brands pay influencers to promote their products to their social media following.
- The influencer marketing industry is expected to reach a market size of $10 billion in 2020. Influencers use social media storytelling to create communities around a brand. Influencers are skilled in content creation and understand social media marketing strategy.
- Content on social media drives consumers' purchasing decisions and daily consumption habits. Brands need to understand social media trends and climate to succeed in marketing.
Social Media Sales
- Besides brands using social media to generate engagements, companies are now integrating social platforms with sales. Brands use social media to monitor social mentions and product engagement to increase sales conversion.
- According to Kleiner Perkins's report, 55% of consumers who discover a product on social media purchase it later, while 11% immediately purchase the product. Facebook is the leading platform for product discovery at 78%, followed by Instagram and Pinterest at 59%, then Twitter at 34%. Brands will continue to leverage social media marketing to generate consistent sales and lead conversions. Brands will continue using paid promotions as part of their social media marketing strategy.
- Social media stories will continue to be a major platform for brands to market themselves on. Over 500 million people watch Instagram stories daily. Stories are more interactive than normal posts on social media. Around 60% of millennials, who have high purchasing power, consume stories on Instagram, 53% on Snapchat, and 48% on Facebook. Due to the level of user engagement rates, stories are becoming a major marketing tool for companies.