The news about the coronavirus and its expansion have already had a direct effect on companies and brands, who have seen their sales figures and their positions in the market change due to the effect that the epidemic is having on consumers. For some specific markets, such as tourism and airlines, the impact on their income statements already seems inevitable and visible. But beyond specific niches, the coronavirus will have an effect on marketing and advertising budgets.In fact, specialists believe that it will be able to slow down the ad spend forecast for this year. That is: 2020 could close with lower-than-expected advertising spending (and the forecasts for this year were very good, thanks to the pull of the US elections and the Olympic Games) if things go worse. If the Olympic Games are canceled, for example, something that is already leading to analysis and speculation, the impact on the annual accounts of advertising will be brutal.But what do specialists see now? At the moment there are no concrete numbers (although some companies have already issued alerts to investors about billing data, which suggests that something similar is happening in advertising), but experts are already making their projections on how the prices could change. things.As explained from CNBC , who has spoken with different specialists about the impact on the overall advertising market of the disease, two scenarios being considered. If things continue as they have been and the disease is contained, spending will not disappear but it will migrate. The investment will move to months later.If this does not happen and the coronavirus explodes with broader dimensions (those that would lead to the cancellation of the Olympics or the UEFA Cup), the blow would be clear and advertising budgets would collapse.Forecasts for the year continue to be generally optimistic. One of the latest studies, that of the World Advertising Research Center, indicated that the year would close with an advertising expenditure of 660,000 million dollars. The estimate was prior to the coronavirus, although their explanations indicated that the slowdown in the economy due to the virus would not necessarily have to affect advertising.The fall of advertising in numbersDespite everything, the industry is concerned about how the investment projection will change and how much money will be lost. eMarketer is already taking the virus into account in its screenings and Zenith is working to update what it is doing. Knowing the impact that the coronavirus will have in concrete figures is, however, complicated since, as one expert pointed out to CNBC , it is still too early to see it.
Some specific data help to visualize it in an approximate way. The British chain ITV, for example, has already indicated that it expects a 10% drop in advertising Hong Kong Phone Number List revenue in April due to the coronavirus and the fact that companies in the travel industry are avoiding advertising.The New York Times has also told investors that they expect a decline in income. “We are seeing a slowdown in purchases in international and domestic advertising, which we associate with uncertainty and anxiety about the virus,” they say in a communication to the SEC. They expect their online revenue to drop 10% this quarter.Those who benefit from the situationOne of Warc’s experts pointed out to CNBC that, possibly, the change that the coronavirus would bring to advertising would be a migration of investment.
If people stay at home worried, the advertising investment will migrate to those media that reach them in that environment, such as streaming, social networks or mobile games. It’s not the only one. An analyst at Forrester also pointed out that streaming channels and food delivery services could be the big growth beneficiaries from this situation.In addition to brands and companies of products related to the prevention – more or less paranoid – of the disease, such as the pulling of masks or hand hygiene products, the services in the home are those that analysts believe will come out indirectly benefited by all this. Although Netflix shares on the stock market are not experiencing a growth rally, investment analysts already point to it as a beneficiary of the situation.
The panic will make consumers want to stay more at home and consume more streaming content.Amazon, Facebook, Slack or Peloton (the American home exercise company) are other companies that could benefit from a quarantine situation, according to analyst data. Some industry executives even believe that it could be ‘good news’ for television: viewers in quarantine or prevention, locked in their homes, will have to do something with their time.Also increasing according to Global Data are staycations, home vacations and local tourist attractions. Instead of going on vacation to another place, you will do it in your own city.