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What will happen to PPC during social distancing?

19 March 2020 10:54am

Whilst automation and machine learning continue to change the face of PPC, it remains one of the most reactive, measurable and scalable channels. The reactive nature of PPC is one of the keys to its success but also why it will require increased attention over coming days, weeks and possibly months.

With social distancing, working from home and other strategies being introduced to mitigate and supress the spread of Coronavirus, online behaviour is set to change drastically. These changes have already started to have a large impact on results across a number of industries and it’s in times like these that it’s essential your PPC strategy is fit to react to these changes in the market.

Understanding your KPIs

It’s not only the high-street that has been hit; search traffic for some industries has already begun to decline over the past week. This could leave advertisers fighting for larger proportion of that traffic in order to maintain lead/sales volume. Alongside this drop in search volume, some conversion rates are in decline, again as a result of changes in online buying behaviour.

With increased aggression from competitors, reduced conversion rates, or a combination of the two, you could be facing a large drop in conversion volume or a spike in CPA. It’s at times like this that it’s more important than ever to understand your KPIs and what they mean to overall performance.

Side-lining a calculated CPA/ROAS target in order to chase this limited volume of customers could easily result in a drop in profit in order to maintain volume. More than ever it’s essential that product margin, delivery and other costs are factored into calculating return on investment.

On the other hand, now could be the time to test a reduction in ROAS or an increase in CPA target and the impact this has on volume if this hasn’t previously been explored. There will always be a trade-off between volume and efficiency through PPC and only by testing at varying targets can you work towards finding that point of diminishing returns where advertising activity is at its most profitable.

Flexible Budgets

PPC budgets should be flexible. If you’re optimising your PPC activity to hit a specific set monthly budget, you cannot simultaneously optimise to maximise profit or even to achieve your CPA or ROAS goals as effectively as with a flexible budget.

Whilst some industries are dropping off, others are set to see a spike in volume as users have a higher need for ecommerce and delivered goods. As traffic volume in these sectors increases, it can be easy to stick to set budgets and optimise to reduced CPAs or an increased ROAS. This, however, isn’t necessarily going to be the best approach to maximise profit.

If you fully understand your KPIs, and you are confident these have been calculated effectively, this increase in volume poses an opportunity to raise budgets for increased revenue at the same level of profitability you have already been working to.

Choosing the right channels

With trends set to change considerably across search for better or for worse depending on the sector, now may be the time to explore your channel mix in greater depth. More time spent in the home is likely to result in more time spent on social networks and online in general. Activity split between search, social and display should be revisited on a regular basis, but with increased user activity, now is certainly a good opportunity to review and test this.

Whether volume across search is in decline and this frees budget to explore other channels, or performance strong and in prime place for expansion, other channels and their role in the sales funnel should be assessed. Is there a greater opportunity right now to explore paid social, display, programmatic TV or other channels which often don’t receive the focus they deserve?

The PPC world, like many other industries and businesses, is having to adapt to a rapidly changing environment. With so much uncertainty at the moment things are developing on a daily basis which can be quite unsettling for many. However, there has been an outpouring of advice and help from many over the past few days which will hopefully help businesses to plan as much as they can for the coming weeks in particular.

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PPC
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Coronavirus
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Online Advertising