its US search ad spending estimates for 2020 — it now expects to see a decline between 8.7% and 14.8% year-over-year in H1 2020.That's about $6 billion to $8 billion less than initially expected. For context, eMarketer's previous estimate — conducted on March 6, 2020 — forecasted a 14.4% increase in search ad spending across all of 2020. In June, eMarketer will update its complete forecast of US ad spending, including search, based on its bottom-up methodology.
In addition to broader economic constraints driven by the pandemic, there are two major factors that will cause search ad spending to decline in H1: Search is geared toward driving conversions, but conversions are down. Due to quarantines, inventory shortfalls, pressure on consumer discretionary spend, and other related problems, many conversions can't happen right now. That's true for both in-store conversions — an obvious casualty of the pandemic — and ecommerce, which has been thought of as an economic bright spot.
Search budgets aren't committed in advance and can be paused or pulled at any time. For instance, both travel and media and entertainment advertisers have paused search ad spending indefinitely due to significant business slowdowns. Despite the expected contraction, search could be the best-positioned ad channel during this crisis — across both digital and traditional formats.
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