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How the Pandemic is Impacting AdTech

How the Pandemic is Impacting AdTech

AdTech is faced with many challenges this year—and the pandemic is just one of them. 

Google announced that it will be removing cookies from Chrome by 2022. California enforced the California Consumer Privacy Act (CCPA). Apple informed publishers and brands that iOS 14 will have new privacy features.

Plus, the pandemic caused advertisers to initially pause spending while online traffic surged—leading to a drop in CPMs. Meanwhile, advertisers delayed payments.

It’s been a wild ride for programmatic stakeholders—here is an update on how leaders are responding.

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Programmatic is Resilient

Due to its efficiency and effectiveness, programmatic has performed well amid the pandemic. 

Initially, programmatic was the first advertising channel to be hit hard because brands could pause campaigns immediately—but its flexibility allowed it to rebound.

“It was quicker and easier to pull money out of programmatic than it was to pull out of some other media with longer cancellation deadlines,” explains James Bayes, general manager for Australia and New Zealand at The Trade Desk. “The reverse of that is that programmatic has been able to bounce back faster and sharper than some other channels…You can make a decision and be active an hour later if you’ve got creative.”

MediaRadar’s research found that to be true. Despite the initial slump in spending, ad dollars were returning by May. Now, total programmatic spend since the pandemic began (Apr-Jul) is up 11% YoY.

Categories Invest in Programmatic Differently

The rise in spending has been far from even. Industries that benefit from social distancing are spending more, while industries experiencing economic downturn are holding onto their cash. 

Percent Change YoY in Programmatic Ad Spend April-July 2020

Education and training brand spending increased significantly as colleges went online and professional training services, like Udemy, increased their spend by 163%.

The travel category, however, is a completely different story. Under normal circumstances, travel is a highly active programmatic buy category. However, due to the struggling airlines, travel spending is down -70% YoY.  Since April, airlines cut programmatic ad spend by more than 90% YoY. 

Programmatic Moving Forward

With all the changes going on in ad tech, not to mention an unstable pandemic, leaders are working in an environment that requires planning and collaboration. 

As a result, leaders across industries and influential organizations launched the Partnership for Responsible Addressable Media to reshape the ad tech ecosystem together.

“The Partnership was created to serve as a collaborative forum for our industry to ensure addressability standards that preserve privacy, provide a consistent and effective framework for advertisers, and enrich the consumer experience,” stated Executive Director Bill Tucker

Ultimately, brands, publishers, and consumers benefit from advertising based on data—but leaders in tech, publishing, advertising, trade bodies, and agencies will have to work together to figure out how to evolve the ad tech ecosystem.

For more updates like this, stay tuned. Subscribe to our blog for more updates on coronavirus and its mark on the economy.