Internet Usage and the Entertainment Sector

We are observing significant changes to the media and entertainment industry.

This is primarily driven by increases in internet traffic which are also impacting infrastructure providers like telecom operators and streaming platforms.

In Europe, Netflix has already agreed to reduce streaming quality for 30 days to reduce the strain on networks.

2019 analysis by networking company Sandvine identified that video accounts for over 60% of data delivered from internet providers to consumers, with Netflix accounting for just under 12% of total traffic and YouTube accounting for another 12%.

At a national level, countries like Belgium are seeing internet traffic nearly double and popular internet properties like Reddit are experiencing increasing 20-50% in certain areas as entertainment and social platform consumption spikes.

Additionally, we are observing companies respond to the events in order to protect advertising revenue and capitalise on users increased time spent engaging with entertainment content.

For Example:

Ecommerce Ecosystem & Sector Performance

In ecommerce, we are observing a number of trends impacting the sector.

Marketing Performance, Conversion Rates & Traffic

With regards to digital performance, we are observing that our clients are paying roughly the same cost-per-click, but the cost-per-conversion has been increasing (in line with decreasing conversion rates).

This is occurring for most industries unless you are selling necessities like toilet paper. From an SEO standpoint, we are observing significant drops in organic traffic across most industries

This highlights the need for ecommerce companies to ensure a diversified marketing channel mix in order to reduce long-term exposure to any one channel.

Ecosystem Impacts & Amazon

Changing consumer behaviour is straining the retail ecosystem and causing sellers to rethink their near-term inventory, fulfilment and advertising strategies on platforms like Amazon.

Sellers are planning to fulfil orders themselves, most Fulfilment by Amazon (FBA) sellers are also not currently set up to accommodate drop-shipping direct to consumers.

Amazon announced they will only receive vital supplies at its U.S. and UK and other European warehouses until April 5. This was discussed in a note sent to sellers on Tuesday in response to increasing online shopping demand and a prioritisation of household staples and medical supplies that are starting to run low.

Amazon defined several categories as essential products that can continue shipping, including baby products; health and household items; beauty and personal care; grocery; industrial and scientific; and pet supplies. Books are included as well.

Online Purchasing Behaviour Insights

💊 Analysis of ecommerce transactions found that purchases for cold, cough & flu products have increased by 198%, while online purchases for pain relievers increased 152%.

🧻 Brick and mortar retailers in both the U.S. and Canada are reportedly limiting the amount of toilet paper patrons can buy, resulting in online purchases for toilet paper spiking by 186%.

🥗 Non-perishable foods such as canned goods and shelf-stable items (rice, pasta) are common staples in emergency preparation. Online purchases for these items are up — 69% and 58%, respectively.

Facebook Announces $100m Grant for Small Businesses

What is Happening?

Facebook is announcing a $100 million grant program for small businesses impacted by the coronavirus pandemic. Businesses do not need to be on Facebook, Instagram or WhatsApp to apply.

While more details are still to be released, the cash grants are designed to help 30,000 businesses from over 30 countries cover operations, occupancy and advertising costs.

What Does it Mean?

With small business making up 45%+ of most economies we expect both Facebook & Google to be impacted significantly by reduced advertising spend from this segment.

Both publishers have been investing heavily in growing their small business segments since 2011.

😯 Additionally, we would not be surprised to see Google looking to support small businesses in a similar program in the coming weeks.

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