3 Reasons Why Facebook Ads are Important for Businesses During COVID-19

Mike O’Kelly, CEO – The O’Kelly Consulting Group

With the current COVID-19 pandemic impacting nearly every aspect of our lives, many businesses are struggling with whether or not they should stop their marketing and advertising initiatives in the midst of a world crisis. For businesses who can continue their Facebook advertising (even at a scaled-back capacity), it is very likely to be beneficial long term. It could be the one marketing effort that could keep the business afloat during the difficult weeks and months ahead. Below we detail the top 3 reasons why Facebook Ads are important for businesses during the COVID-19 pandemic.

Reason 1: Digital Attention is at an all-time high

With the many government quarantine mandates and most people staying at home in order to reduce the spread of the coronavirus, social media and internet usage has sky-rocketed. People are logging into Facebook and Instagram at unprecedented levels. Facebook has recently reported an increased usage by 70% in specific markets. This means the amount of available marketing impressions, and the capacity for advertisements to reach target audiences are both increasing.

Reason 2: Many other businesses are stopping their advertising campaigns

Many businesses' initial instinct during the COVID-19 pandemic is to stop or pause all marketing campaigns until the situation dies down. This is precisely why we recommend our clients to continue their Facebook ads during this particular crisis.

To quote Peter Fader of the Wharton School of the University of Pennsylvania, “As companies slash advertising in a downturn, they leave empty space in consumers’ minds for aggressive marketers to make strong inroads.” When marketers cut back on their ad spending, the brand loses its “share of mind” with consumers, with the potential of losing current – and possibly future – sales.

With many competitors out of the running, the shared customer database will be ripe for the taking for those who continue their marketing and advertising efforts. With the competition for the same audience being lower, key performance indicators (i.e., CPC, CPMs) will be much lower.

Essentially, less competition means ads are on sale, creating a "buyer's market" for businesses.

Reason3: Studies have proven that businesses who maintain or increase advertising during downturns average significantly higher sales growth

Contrary to most marketers’ actual behavior, there have been many studies that clearly show that it pays to maintain advertising expenditure in an economic downturn. A 2002 study from McKinsey & Company studied nearly 1,000 US companies over the period of 1982-1999, including the recession of 1990-91. The businesses who increased their advertising expenditure during the recession were the ones who either remained industry leaders or became industry leaders post recession.

In the 1990-91 recession, Pizza Hut and Taco Bell both took advantage of McDonalds' decision to drop its advertising budget. As a result, Pizza Hut increased sales by 61%, Taco Bell's sales grew by 40%, and McDonald's sales declined by 28%.

Although immediate profits may be protected by reducing Facebook advertising expenditure, the benefit will be very short-term. Neglecting Facebook advertising during this downturn will result in a weakening of brand, potentially making it less profitable in the future.

Conclusion:

Although the natural inclination for advertisers is to cut back on advertising during a downturn, those brands that maintain their ad budget can get a long-lasting boost in sales and market share.

Businesses who continue to advertise on Facebook during the COVID-19 pandemic will not only be able to reach more eyeballs with their marketing messages, they will be able to do so at a major discount.

If you are looking to start investing in a professional Facebook advertising campaign today for your business, schedule a call with one of our digital marketing experts to discuss your advertising needs.