COVID-19 Paid Search Trends
Paid Search CPC
On March 14, Backbone began seeing the effects of COVID-19 on the outdoor recreation industry. Brands and retailers quickly adapted strategies to meet the changing consumer behavior and media consumption. Paid search was no exception. Based on a combination of client data and Google Trends, Backbone is monitoring the impact of COVID-19 on paid search.
Comparing cost per click (CPC) metrics during a time period before versus during the COVID-19 outbreak (Jan. 1, 2020–March 13, 2020 versus March 14, 2020–May 18, 2020), branded-search terms CPCs have increased significantly, seeing a 31% increase, while non-branded terms are showing a decline in CPCs of 34%. This trend has also held true year over year with branded CPCs increasing by 20% and non-banded CPCs decreasing by 67% compared to the same period last year.
Branded Versus Non-Branded Search
Backbone is seeing branded terms become more competitive than non-branded. This trend looks to be related to retailers starting to bid more aggressively than usual on branded terms due to brick-and-mortar retail being temporarily suspended. In other words, brands and retailers are leaning in to branded paid search to drive e-commerce sales to help close the revenue gap between channels. This is the main driver for the increase in branded CPCs.
Traditionally, branded search campaigns convert at a much higher rate than non-branded search campaigns. However, as retail channels are temporarily closed, brands are shifting funds into branded terms to drive sales while pulling back on non-branded spend because prospecting is less of a priority right now. The increase in competition and CPCs in branded search, as well as the decrease in non-branded search-campaign CPCs, is the result of this strategic shift in paid search born from the impacts of COVID-19.
As stay-at-home orders are lifted and brick-and-mortar retail begins to open, Backbone will continue to monitor the impacts of COVID-19 on paid search and will post further findings as they become relevant. If you have feedback or questions, please send a note to Jeff Palmer below.
