How brands are making sense of measurement during a global pandemic
Brands that continue to advertise during a crisis generally recover more quickly, but the COVID-19 pandemic has deleted nearly all relevant data that shows them how.
That’s because brands use measurement models from previous campaigns to help execute ad buys. These models use machine learning and AI algorithms to calculate how a variety of factors drives sales. These include competition, product mix, customer service, weather, geography and advertising channels—which among desktop, mobile, social, linear TV, print and others are delivering the best return on investment.
The coronavirus pandemic, however, has made those models obsolete, as both consumer behavior and the overall economy have radically changed.
Measurement companies as a result are changing their models, incorporating new indicators while tweaking others. Google, for instance, recently began sharing data on what products consumers are searching for and where, prompting companies to now incorporate that information into their analysis. There’s also been a greater emphasis placed on location data as many businesses start to reopen their doors. Other advertising channels, meanwhile, are being weighted differently: Although out-of-home advertising is being monitored, it’s become far less important than connected TV, for example.
Some brands are analyzing weekly and even daily data—something marketers don’t normally rely on so heavily. Others are tailoring marketing messages to consumers working from home, and using A/B testing to measure results. A majority are adjusting—or even pausing—their ad spend.
“You had a series of cogs that were moving together and coronavirus threw a wrench in it,” says Nancy Smith, CEO of Analytic Partners, a measurement company with clients including McDonald’s and Scotts Miracle Gro. “Many of the models that existed are now broken because of new forces at play.”
Companies including Analytic Partners are using new and adjusted indicators to navigate the current climate. Mobility data, previously used, is now much more important, especially as states begin to reopen. Most retailers are pushing for consumers to shop online and have tweaked their strategy as a result, but a sudden spike in foot traffic to brick-and-mortar stores may change that, for example.
“You need time to ensure that measurement models are accurate and you need to know what the leading indicators are,” Smith says. “Just because a client saw a surge in online shopping today doesn’t mean they will tomorrow.”
“You need to think about your business in a dynamic way, but the world is changing so quickly,” Smith adds.
Ad budgets shrinking
About 82 percent of media buyers said they are either adjusting or pausing ad spend for the second quarter, up from 74 percent compared to the same time last month, according to a recent IAB survey. Shrinking ad budgets have made ad performance more important than ever, but because there’s been nothing like the coronavirus pandemic in the digital era to compare against, marketers have little information when making decisions, says Tina Moffett, a senior analyst at Forrester.
“Advertisers are asking how well their TV and online ad spend is performing, which demos have been hit hardest and whether people are even spending,” Moffett says. “Data and analytics are being put to the forefront as a priority to help navigate through this time.”
Brands hit particularly hard by the pandemic, such as Airbnb and Expedia, have halted their measurement contracts further notice, according to a person familiar with their contracts. Neither company responded to requests for comment. Other brands are pausing their ad spend, but working alongside their measurement vendors in developing a strategy on how they will re-emerge later this year or next.
The pandemic has changed what products consumers buy, and one large consumer packaged goods manufacturer, which declined to be identified, is focusing on whether it’s going to retain those customers long-term. The company is working with IRI, which is following campaigns that target such buyers through tools including loyalty reward program data. The endgame, according to IRI Worldwide—a measurement company that specializes in the CPG space—is to determine if targeting these new buyers is an effective business strategy and if it is, determine which channels work best.
“The argument right now for measurement is less a means for building rules of thumb that apply to future campaigns,” says Nishat Mehta, president of media excellence at IRI Worldwide. “Frankly, measurement right now is a lot more about real-time optimization.”
“People want results weekly so they know what to change next week, not their next campaign,” Mehta adds.
Other brands are pressing ahead with existing marketing. One is Verizon-owned Visible, which earlier this month launched a new campaign, although it will be keeping a closer eye on progress, says Minjae Ormes, chief marketing officer. Visible competes with value carriers including Mint Mobile and MetroPCS.
“How we check in on metrics now as a business is not dissimilar to what people are doing with each other these days—checking in more often and meaningfully, and the question of ‘how are we doing’ is coming up more frequently,” says Ormes.
New messaging approaches
Visible does not have storefronts, and Ormes says that fact wasn’t its strongest driver when previously pushing out creative. That changed, however, as more consumers began working from home: An ad stating that users can “sign up from your office, aka the couch” performed nearly 30 percent better in bringing people to Visible’s website, says Ormes.
“As situations continue to change for folks, we’re keeping an eye on this also to ensure how this might change over time, or become more of a permanent fixture to our suite of messaging approaches,” she says.
Making tweaks to creative to see which performs best—known as A/B testing—is necessary when creating measurement models, but experts suggest to proceed with caution when finding success similar to what Visible saw with its ads.
An unexpected result of the pandemic was an increase of organic sales through non-paid channels—including social media, content marketing, search or PR, says John Koetsier, VP of insights at measurement company Singular.
“We tend to think of marketing measurement primarily for ads,” Koetsier says. “But organic customer acquisition jumped 21 percent across the board for Singular customers in April, as new needs—and more time—drove consumer behavior.”
“Measuring organic marketing results is just as important for real-time optimization as measuring paid ads,” Koetsier says.
Similar to Visible, Koetsier says Singular clients are looking at near real-time data to optimize campaigns. “Marketers who used to check a campaign weekly are now checking daily,” he says. “The rate of change, especially with partial reopenings now, is increasing.”
Under normal circumstances, marketers wouldn’t rely on daily or weekly data as heavily as they are now, but times are changing due to COVID-19, says Koetsier.
“Learn slow, die quick,” Koetsier says. “If your learning cycle is weekly or monthly, it’s likely that your competition is consistently out-optimizing you: getting more attention, more clicks and more customers faster and cheaper. Your profit margin will invariably suffer.”