US digital ad spending has been growing at a double-digit rate for years even since the last recession. But the pandemic has changed all that. In April 2020 in the height of COVID-19, we took a look at how the pandemic if at all has had any impact on ad spending. Digital media consumption boomed as soon as lockdowns and stay-at-home orders hit various parts of the world from February through April. In mid-April, we shared information with VentureBeat regarding the fall of the advertising market by 20-30% YoY and 40-50% of the planned one. These numbers were indirectly confirmed, for example, by Twitter reports for the second quarter.
Based on the fill rate, we would like to show how things were moving in Q2 and the first month of Q3. As we said earlier, on the market, there occurred a panic, and many advertisers, especially large consumer corporations, suspended all or a part of digital advertising posted on social and content networks (data from FunCorp, the developer of user-generated content mobile apps). However, here is the visible panic component, as the whole world did not know what to do in this situation, and many companies have chosen the strategy of careful waiting, which is visible in May chart:
Credit: iFunny app ads Fill Rate - May 2020/May 2019
And after two and a half months of waiting, we're reminded that the fall began in the middle of March 2020, with the introduction of quarantine in the U.S., the market started to adjust to the changes, and as it often happens with exchange trading, some buyers have replaced others. Some adapted to the current changes, and it turns out that there is an apparent recovery of the market to pre-crisis times right around mid-June, although it is evident that some advertisers from the real economy have not returned and are not likely to return.
Credit: iFunny app ads Fill Rate - June 2020/June 2019
At the beginning of the third quarter, we can see there is already a stable recovery of the developers' market within advertising monetization. We, as one of them, have corrected our own plan and expect the minimum growth of ARPDAU YoY to be no less than 10%.
Credit: iFunny app ads Fill Rate - July 2020/July 2019
In the past several months from what we have seen is that digital ad budgets were cut quickly in response to the pandemic. As it wore on, marketers saw the flexibility and targeting potential of digital as a critical element in their mix. However, we’ve learned through this period that this year will be the first in which digital advertising will attract more than half of the total global ad spend. Looking ahead, marketing budgets will start to ease as we see an uplift in digital ad spend.