The current Corona crisis influences every facet of our daily lives – from family routine to the economy – and digital marketing is no exception.

Many businesses have shut down their activity, whether because of direct government instructions or for other financial reasons. These businesses have also naturally stopped promoting their products via digital platforms.

Does this mean everything is gloomy? Can we close the Facebook? How does a sharp decline in paid promotion affect those who continue to advertise via Facebook? What can we do about it all? We set out to check (without leaving the house, of course).

The Findings

It turns out that the old cliché is correct – nothing is ever totally bad.

We discovered that the current situation has caused the cost per impression to drop sharply in some client accounts. In order to understand why, let’s first get to know the Cost Per Mille metric (CPM) – the cost per 1,000 impressions.

This metric calculates how much we need to pay to reach 1,000 pairs of eyes. This doesn’t mean that those eyes necessarily read the ad but rather, that it appeared in their Facebook feed.

What influences the CPM metric? Many variables but the three main ones are:     

1. The number of advertisers turning to the same target audience – the more companies there are competing for the same audience we want to reach, the higher the cost will be.
2. The quality and relevance of the ads – the more interest our audience shows in the ad, the more Facebook will endeavor to lower the cost of displaying it to this audience.
3. The location of the ad (advertising space) – an ad in an Instagram story will usually cost less than an ad in a Facebook feed because of the larger number of Facebook advertisers compared to those in stories.

Sound like Chinese?

The first variable is the critical one for our discussion and encompasses a fairly basic economic principle – supply and demand. In our case, the number of advertisers on social media is declining (there are many sectors that have stopped advertising due to the Corona virus such as hotels, tourism, restaurants and others), while on the other hand, the number of people using social media has risen dramatically (many people have lost their jobs, many are working from home and using the internet more, children are on “holiday” etc.). The result is that demand for advertising is declining while supply is increasing, and costs are dropping accordingly. If your business or non-profit is still active during the Corona period, by working correctly and professionally you can benefit from low advertising costs that just can’t be found anywhere else.

A Good Illustration

When we check the figures measured in the CPM metric against the costs of leads and number of impressions, we can see the opportunity offered by the current situation. Here are two examples from the promotion accounts of two of our clients. The figures relate to the period between March 1-17.

• Account A
  • The CPM Metric
    • At the beginning of the month, the average cost was 28.85 shekels. From the middle of the month, the average cost was 11.76 shekels. The same sum allocated to advertising generated 3 times as many impressions.
  • The CPL Metric – those people leaving contact details.
    • The cost per lead in the middle of the month was 64% lower than the cost per lead at the beginning of the month. For the same sum spent on advertising, interest was just over double.

• Account B
  • The CPM Metric
    • At the beginning of the month, the average cost was 28.69 shekels. From the middle of the month, the average cost was 18.49 shekels. The same sum allocated to advertising generated 1.5 times as many impressions.
  • The CPC Index
    • The cost per lead in the middle of the month was 41% lower than the cost per lead at the beginning of the month. For the same sum spent on advertising, interest was almost double.

As we can see, there is a decline in advertising costs during the second half of March and yet, there is an increase in impressions and a drop in the cost per lead – all surprisingly positive numbers!

To Succeed with What We Have

In light of the intensifying crisis, it seems that increasingly more businesses will suspend advertising activity and that advertising costs will continue to drop. So, if for some reason you’ve delayed promoting your product via digital media because of the cost – this is your opportunity. The platform has stayed the same, but the costs have been slashed. By working correctly, you can get much more for your advertising budget – whatever it is.

So, let’s make lemonade from the lemons!