A new study shows that businesses have shifted resources to digital marketing as a result of the coronavirus pandemic - and it is paying dividends.
Criteo, in partnership with Dynata, surveyed over 1,000 marketing executives from the United States, the UK, France, Germany, Spain, Italy, Australia, Japan, South Korea and India for its State of Digital Advertising report.
Unsurprisingly, the results show that the majority of marketers suffered lost revenue due to COVID-19 last year. In the UK, nearly two-thirds (65%) of UK marketers lost revenue compared to 2019.
However, the UK has emerged as one of the healthiest retail markets with only 10% of marketers seeing a "big decline" in revenues due to COVID-19, compared to 25% for Spain, 22% for the United States and 21% for France. Only Germany fared better, with just 8% reporting a "big decline" in revenues.
The findings also show that 76% of those surveyed said that the marketing function has increased in importance during the pandemic, as marketers seek to acquire new customers (61%) and boost their digital marketing activities (59%).
The report concludes that marketers have made a "dramatic turn from traditional investment areas" in order to focus resources on digital tactics, with 71% of marketers reporting that the share of digital marketing spend has increased across all channels and will continue to rise in 2021.
Social media has been the main beneficiary, seeing the biggest increase in marketing spend in the past six months in the UK (68%), followed by retail websites and apps (62%).
The analysis also suggests that this tactic is working - one in three UK marketers say they have seen a "rapid digital transformation of business processes" as well as an increase in website sales. Over three-quarters (77%) say performance marketing channels will attract more advertising spend in their organisation this year, with website sales (46%) and average customer spend (45%) ranked as the top metrics influencing marketers' plans.
"COVID-19 has clearly impacted the channels in which marketers are spending their money, as consumer behaviour shifts to an almost exclusively online model in the UK right now," said Marc Ó Fathaigh, UK country manager at Criteo.
"No company, in any region, is unaffected. But it is encouraging to see that despite dips in revenue, the share of marketing spend online is set to soar this year - an unusual statistic historically in the context of a global economic recession - as companies refocus their strategies digitally to invest in channels that present a clear return on investment. As brand advertising becomes increasingly easier to measure online, we expect marketers to pursue this digital line of enquiry much more vigorously in the face of shrinking revenues and look for solutions that reach the right audiences and the right time."
Written by Rachel Miller.