Our world changed dramatically in March 2020 when a new viral threat to our livelihoods emerged in the US and around the world. Here in the US (at the time of this writing), COVID-19 has not given way

Some industries are more affected than others. For example, travel and tourism companies have done far more harm than many other industries due to social distancing policies and stay-at-home orders.

However, all businesses should reassess their planned budgets for paid search and other paid digital campaigns for the next 12 to 24 months. Hopefully this pandemic will ease faster and the economy will get out of our impending depression sooner sometime next year. However, since no one can know exactly when this will happen, it is better to be safe and plan accordingly. Ask yourself the following questions:

  • What assumptions have you made about your priorities for 2020?
  • How has the global pandemic and economic recession affected these priorities so far?
  • How have your trends changed and what changes have you already had to make?

Once you can answer these questions, you are well on your way to building a more stable plan for your paid digital advertising campaigns.

Now comes the hardest part: how do you account for these changes and plan for the next year or even two years in advance?

To do this effectively, you need to decide which overall business goal is more important to you:

1. Increase sales volume at the expense of profitability.


    2. Maintain a profitability margin, even if it means you have less sales.

      Don't choose both. Of course, you want to generate more sales and maintain or increase profitability – everyone wants that. However, if your business has been struggling since this recession hit, right now you don't have the luxury of choosing both. If you have both goals, you are more likely to implement competing tactics in your campaigns that can result in you failing to achieve either goal. So choose one. If you can consistently develop it in this new environment, you can make an effort to meet the other in addition.

      Sales volume in focus

      If your primary goal is sales volume, refer to the year-over-year trends you've observed since the COVID-19 outbreak and the recession outbreak. Pay close attention to the last month or two since things returned to a more "normal" outlook for business reopening (albeit with strict social distancing rules). For example:

      • Have you seen website traffic dropping a bit since May, but no sales or conversions?
      • Have these things increased in certain channels but not in others?
      • How did your ad volume correlate with these conversion shifts?
      • Have you seen an increase in the cost per conversion level that now looks more stable?
      • How do all of these things compare year after year?

      Whatever you experience after answering these questions, plan these year-on-year trends for the foreseeable future. Take seasonality into account and plan how many conversions, sales, and / or how much revenue you want to get each month or week in the future. With those hard numbers planned out, do the math quickly by taking your cost per conversion and return on ad spend (ROAS) into account, and correlating how much money you will need to spend to meet those sales goals.


      With these new budgets and goals, can you meet your overall sales goals? You may be able to hit targets directly for a particular channel (e.g. paid search) but still lag behind overall. If so, refer to your impression percentage or percentage of voice metrics, competitive intelligence, and tools like Moz or Google Trends to see if it is realistic to generate even more revenue if your existing predictions don't meet your goals .

      If these factors leave little room for potential growth, adjust your sales volume goals and expectations to accommodate this post-COVID new normal. In this case, your opportunity for potential growth lies in high funnel channels (e.g., programmatic advertising, digital video ads, traditional media purchase) to reach more potential new customers. Just take into account how many conversions or sales these high funnel channels are actually supporting to make sure you're putting your advertising budget to good use.

      Focus on profitability

      If your primary goal is profitability, refer to the same trends and answer the same questions as above. Again, pay close attention to the last month or two as the economic recession has set in for the long run. Whatever you experience, plan for these trends to continue year over year. Then, taking seasonality into account, forecast how high your campaign budget should be by month or week when you specify the ROAS or ROI you want.

      Instead of having to adjust your budgets to meet a desired sales volume threshold, you may find that your forecast budget is lower than what you originally expected for 2020. You will likely need to cut budgets or pause certain campaigns that are just not profitable right now as changes in conversion costs and / or demand have negatively affected your trends. If this happens to you, plan to take the budget that you are now cutting out of your particular paid campaigns and reinvest any remaining funds in other channels or savings (assuming those funds aren't wiped out by lower sales volume).

      This ability to maintain a certain profit margin is likely to result in lower overall sales and a lower ROI for your entire business. The goal is to stay profitable enough without having to cut your overall business significantly. Sacrifice what you need for paid digital advertising to stay afloat and maintain profitability throughout this economic recession.

      Something else to consider

      Be nimble and reactive when economic circumstances change as we are still at an early stage of great uncertainty. You may find yourself re-forecasting much stronger on a consistent basis this year and next due to fluctuations in the economic climate and outlook. Remember, everyone else is in the same boat as you – no one knows what's coming in the next year or two, let alone the next few months.

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