90% of ad execs say coronavirus pandemic disrupts campaign plans; OTT news viewing surges

Ninety percent of brand marketers and ad agencies say they have experienced a disruption in their advertising plans caused by the coronavirus pandemic, according to a new survey, with more than one-third saying they have cancelled a campaign completely prior to its launch as a result of the health emergency.

The survey of US brands and ad agencies, Advertiser Perceptions COVID-19 Report, was conducted in mid-March, before the true scope of the pandemic in the US was known.

More than two-thirds of respondents (69%) said COVID-19 has had “major impact” on their spending with 28% saying they expected a similar impact in Q3 and 11% in Q4. Some 68% said 2021 ad spending likely will also be reduced.

The amount of time consumers in the United States spent streaming news daily increased 223% in the first quarter.

Brightcove Preliminary Q1 2020 Global Video Index

Advertiser Perceptions, an ad business intelligence firm, said the timing of the report may not have caught the true scale of the impact. It plans to field it twice monthly and expects trends could worsen.

The pandemic has created a large amount of uncertainty among brands. Advertiser Perceptions said during a discussion of the report that COVID-19’s spread has created a knee-jerk reaction among execs to simply hit the “the pause button” before looking for alternative ways to respond.

OTT, streaming advertising least impacted by coronavirus pandemic

While just 21% of respondents said they would pause their spend on OTT and streaming video services, TV and other digital advertising has taken a significant hit, the company reported. Forty-three percent of respondents saying they had paused, cancelled or pulled budget from digital video advertising. Broadcast linear TV wasn’t far behind at 41%, while cable linear TV has seen 34% respond by adjusting spend.

Sarah Bolton, EVP of business intelligence for the company said, “Digital is most likely negatively impacted here, followed by TV. We can see that pause button being hit across media types.

But, survey respondents said they were twice as likely to restore spending on digital video than broadcast or cable linear TV; 14% said they’d quickly resume spending on digital video, compared to just 7% for broadcast and 7% for cable.

“Digital’s ease of optimization obviously makes it relatively easy to pause but also easy to turn back on, or even reallocate to,” she said. “Whereas TV is a little less nimble.”

Respondents reported they were least likely to cut budget for search advertising (24%), and also said it was most likely to be reallocated (24%).

Sports cancellations hit ad planning

Respondents said the cancellation of almost all sporting events had a big impact on their spend. Budget cuts for sports, included:

  • NCAA Basketball Tournament (33% planned for TV spend, 23% planned for digital spend)
  • Major League Baseball (29% TV, 16% digital)
  • NBA (31% TV, 17% digital)
  • PGA Golf (22% TV, 14% digital) and,
  • NHL (23% TV, 15% digital).

And, as recently was reported, some $1.3 billion in ad spend had been planned for the now-postponed 2020 Tokyo Olympics.

It’s not just that brands don’t want to spend, but finding an appropriate place for campaigns has been difficult. More consumers, obviously, are watching some sort of TV, but matching inventory to content comparable to live sports has been challenging.

News is one area that has seen a tremendous increase of viewers but, as Lauren Fisher, VP of business intelligence for the company said, matching creative to news that is primarily grim is tough.

“The type of creative that you’d run for a live sporting event is very different than you’d run next to a story about a pandemic,” she said.

Streaming audience is surging

The survey found a significant shift in media consumption, with 80% of respondents saying they would increase their consumption of streaming content. Interestingly, nearly as many, 72%, said they would increase their smartphone use, while 74% would watch more content on the Internet and 57% via live linear broadcast or cable television.

The stay-at-home orders now nearly nationwide has prompted more viewers to look in more places, especially streaming, for new content.

But, efforts to mitigate COVID-19’s spread has shut down all but essential businesses. And Hollywood doesn’t qualify.

One big question: What happened if content production slows or stops as a result of the pandemic?

The bottom line

The ad industry is in a state of flux, as is the media and entertainment industry, sports and the overall economy.

Sports rebound remains a major question. Will baseball restart before mid-summer? Will the NFL or NCAA have a complete football season?

News has become an especially hot commodity for consumers, and they’re streaming more than three times as much of it in the first quarter as they did a year ago, according to preliminary numbers from Brightcove’s Q1 2020 Global Video Index (release date in June).

The amount of time consumers in the United States spent streaming news daily increased 223% in the first quarter (through March 15) over the same period in 2019, with the biggest increase coming in January (+354% Y/Y), followed by a 313% jump in February and a 223% increase in the first two weeks of March.

The biggest single day for streaming news was March 13, the day President Trump declared a national state of emergency. It saw the largest cumulative time viewed in the quarter.

Keeping campaigns running is critical because viewers likely will keep a tight grip on their wallets. That makes news one of the only games in town, in terms of live and engaging. It’s an opportunity for brands with the caveat that they’ll likely be next to content that can be frightening.

But not keeping a brand off the air can be stunting. As research from Kantar points out, brands who go dark face a harder time rebounding than those that don’t.

Stay tuned… and stay well.

Jim O’Neill is Principal Analyst at Brightcove. You can follow him on Twitter @JimONeillMedia and on LinkedIn