The impact of the current crisis on the digital industry
Author: Marina Niciforovic, Marketing Manager, Novaston Marketing Consultancy
The pandemic caused by the virus corona has affected all industries, including digital. According to online magazine Original, Europe's most valuable digital companies, including startups, have lost a total of 383 billion euros as of January 31 this year, a drop of as much as 33 percent.
In order to comprehend the economic impact on the digital industry and take the necessary steps to recover, during and after the current crisis caused by the pandemic of the coronavirus, IAB Serbia held the first live online panel discussion. Panelists, representatives of publishers, agencies and advertisers shared their current experiences and opinions when it comes to changing the way they do business and adjusting to the current situation, as well as understanding the consequences that will be felt in the economy and how to potentially mitigate them.
According to Nenad Milic, IAB Serbia Executive Director, IAB Serbia, as a trade association representing a substantial part of the digital advertising industry, will continue to advocate common interests and consider ways for their members to match or apply for some of the programs offered through the adopted economic recovery plans raise awareness around the consequences in discussions with institutional representatives (e.g., those of the Serbian Chamber of Commerce). „At the same time, we are joining forces with other relevant trade organizations in the advertising industry in an effort to reach as broad a consensus as possible around advocating shared perspectives and proposing measures and recommendations intended to mitigate the adverse effects felt by the industry“, said Nenad Milic.
Many brands are currently postponing or canceling their campaigns, focusing their activities on adapting communication as well as creating strategies for when and how to get back into advertising. Brands that are less affected by the current situation and have maintained communication in these moments will begin to return to advertising very quickly and thus be able to overcome the crisis more easily.
One estimation is that publishers are most affected by the ceasing of advertising, where print is at its greatest loss. Among other things, they focus their current activities on crisis PR news and announcements regarding donations, i.e. corporate social responsibility. The attention of the audience is heavily focused on digital media and TV, and there is a strong increase in visits to these channels.
Agencies analyze what is happening in the market and tailor client communication to the current situation. Instead of sales campaigns, they are working on how to reach consumers digitally, how to help them and meet their needs. One of the panelists, Bojan Ostojic from OMD Media Agency, emphasized that present communication to consumers must first be relevant and informative and then have elements of empathy and fun.
The quick and smart response is needed as consumer habits change day by day.
We asked experts...
According to Nenad Milic, IAB Serbia Executive Director, it is still early to make any accurate forecasts. „I fear that the whole situation caused by the Covid19 virus will have very far-reaching consequences for the entire economy. Since the outbreak of the pandemic, the digital advertising industry has seen a decline of 55% over what was expected in this period. On the one hand, internet use has increased significantly as people are turning more to the source of their information or to complete their jobs and responsibilities. On the other hand, a huge number of campaigns, especially of large advertisers, have had to be canceled or postponed, which has led to an enormous gathering wave that has spread to many actors in our community (publishers, media-digital and creative agencies, ad tech and production agencies, etc.) and who now all suffer certain financial consequences. What will be crucial is that the world will no longer be the same after this, and we will all have to learn serious lessons from this experience in order to be far more prepared in the near future to face such and/or similar crises. On the other hand, I also think that for digital industries generally speaking, this might be a good opportunity in the long run for its acters to use their experience from this pandemic and its impact on economy and finance sector as a somewhat of a "case study" and argument, in order for all advantages of digital advertising to be highlighted, which might result in larger interest in digital advertising services and products", said Nenad Milic.
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