Google’s 50% Marketing Budget Cut During COVID-19 – What It Means
It would be 100% true to say that COVID-19 has affected revenue in many businesses, some more drastically than the other. Besides digitization, the more cash reserve a business has, the better chance it will survive.
Many companies that we know are forced to turn to survival mode simply because not every business is built to receive no revenue for several months. They had to cut down their expenses in all aspects, reduce working hours, and minimize advertising investment. This situation will affect Google as a lot of the marketing budget has been reserved for Google. So with Google’s 50% marketing budget cut and a freeze on new hires, we can get to a few conclusions below:
- Even companies with cash reserve may be investing in a lot of aspects that we don’t know, Google is a great example of a company that invests in vast areas that we cannot see. Managing costs based on the revenue changes is necessary regardless of cash reserve. Even with cash reserve at hand, it is not easy to decide the same expenses if revenue reduces drastically.
- Ad spend is a huge deal for Google although the company provides many services. As search volume dropped drastically in many verticals, some 80%, and advertisers are minimizing their campaign budget, Google is affected severely.
- COVID-19’s impacts on the economy can be wider and last longer than we would try to forecast.
- Some companies may benefit from the situation due to its unique nature or product/services, and companies that still can engage with potential customers during the crisis will see benefits after the pandemic.
Google will definitely survive the crisis and the company will come out stronger. And this announcement seems to support our confirmation in the previous articles: It is necessary for marketers to rethink marketing, from just coverage to actually building a customer experience that makes sense, engages and drives results while all activities are pulled together. At Syndacast, we were built to cope with challenges and to create tailor-made solutions that make the best use of each dollar spent.
Let us know today on your plan to cope with the crisis, we may have the insights and tools in place that can help you move forward.