What does Covid19 Pandemic mean for SEO agencies?
The businesses today are grappling with a barrage of challenges thrown at them by the ongoing Covid19 crisis and most of them anticipate the severe business impact.
While most industries will take a hit, there definitely will be some that catalyze opportunities that pop-up alongside crisis.
In this article, I will brainstorm COVID 19 discounting strategies specific to SEO & Digital Marketing Agencies.
If past data is anything to go by, marketing is the function that would be the crucial link that separates the winners from the losers.
Let’s start off by a quick look on advertising spend cuts in the US resulting from the global stock market crash of 2008:
Even in 2008, marketing spend cuts in the US were just 2% for Online channels, this can be attributed to two main reasons:
- Online marketing is relatively cheap & more targeted
- Most online marketing campaigns are more around lead generation/sales and less around do with branding
So in a nutshell, Digital Marketing helps add to the top line of any business, so to begin with, this adds a little sigh of relief 🙂
What industries can really afford to ignore SEO?
Well, only those industries will ignore digital marketing where business survival itself is in question. Those are business that falls in a category classified as high Exposure (refer heat map below):
The covid19 crisis could hurt as many as 45% of North American companies, an analyst warns — here’s the chart showing which ones will be most and least affected. Source: Business insider
Our Research on Impact of Covid19 on Ecommerce
In order to have more concrete evidence of which industries are currently being impacted by the ongoing COVID19 crisis, We conducted a study on almost all industries that are now focusing on Ecommerce such as Fashion, Grocery, Wine & Liquor, Toys etc.
Here’s how we zeroed down on our focus industries:
- 20 Industries from Shopify & Woocommerce: We compiled a list of 20 industries most relevant for E-commerce, our most obvious choice was to extract it from the listing on popular e-commerce platforms.
- Shortlist top volume buy intent keyword: We used AHREF to shortlist top volume keywords for each industry that showed customer buying intent. An example of such a keyword can be “buy liquor online”.
- 3 Month Google trend: Analysed Google Trend for the last 3 months specific to each industry keyword.
- Grading Based on COVID 19 Impact: Scale Basis the obtained results each of these 20 industries was categorized into 3 categories
- Positive impact,
- Moderate Impact,
- Negative Impact
Observation: Of the represented 20 online industries, 2 were negatively impacted while 4 were moderately impacted. Also, 14 number of industries showed a positive impact due to this ongoing crisis. So while brick and mortar stores have had a huge negative impact of Covid19, the ones with an online store have mostly been positively impacted.
The below chart shows a comparison between Industry categories and their respective percentage changes in search volume over a duration of 3 months(16th Jan 20 to 15th April 20).
Surprise Element: All other industries were as per our expectation, what surprised us was Furniture, when we dug a little deeper we zeroed down to 02 reasons for it:
- Probably under lock down, people while at home were searching furniture to buy, although the searches did not actually convert to sales.
- Many searches were related to furniture that could help folks work from home.
Should SEO Agencies Offer Covid19 Discounts?
Recommendations will differ for each of the mentioned categories:
Discounting strategy based on
It is true that cuts are going to happen and many of your clients will not be able to spend the amount that they had previously proportioned or they may just look for a discount since everyone is giving it off.
Deep down they know that digital spending will be something that will keep businesses alive and ticking.
For an SEO agency, the competition would be ever fierce now and finding new clients is going to be an uphill task. However, retaining existing ones might not be that tough.
What’s the major dilemma faced by SEO Agencies?
The major dilemma faced by SEO agencies is a difficult choice between profitability vs customer retention. Businesses pay for the services offered by SEO agencies based on the perceived value they derive from it. Cutting prices would only harm in the long run by bringing down this derived perceived value from their services.
Other factors influencing Covid19 Discounts?
Practising discipline in pricing for a long term growth rather than short term gains helps to present a strong foot forward when the economy recovers.
The market no doubt is turbulent but a long term strategy would always help one to gain substantial grounds and come over the competitors during this period. This is true for both the SEO agencies and their clients.
Many would cut back in a time when organic traffic and conversions are both low. But a carefully crafted strategy would allow for space to gain ground over the competitors to many.
When it comes to this discounting is not an option to discard. But how they are positioned would play a crucial role in determining the sustainability of such a strategy over the long term.
A discount policy contingent upon a client’s eligibility and financial requirement would also stand to gain trust and strengthen long-established relations in these turbulent times. But agencies should be mindful of how long they would want to run these discount offers otherwise they risk reducing the value proposition of their services.
As already mentioned, the discount can be provided for industries with moderate impact and that too for a moderate period of time.
Existing Unclosed Deals
Here, we need to understand that the markets have changed substantially and so have the businesses. And closing would require restructuring the deal as per present market conditions. Here, instead of discounting agencies can look for is bundling of new products as an add-on trial for a limited period without discounting the existing products.
This would provide a two-fold benefit.
One, it would enhance the value of the services being offered and allows for an escape route to agencies from the trap of reducing the perceived value of the services being offered by them.
Second, provide an opportunity to introduce new potential products to the customers.
For customers who look to shy away from existing products due to lack of cash flows, different lower-priced products could be introduced at this point and they upgrade back to the regular services when their cash flows and the economy picks up.
The present times call for a new dynamic pricing model wherein we share the value with our clients. Previously calculated profitability would be difficult to obtain and it is the need of the hour to share some of our profits to help our clients survive these times. Such solutions would not only help existing clients but also bring in much needed new clients to rack up new accounts.
The time is ripe where businesses need to understand that it is their opportunity to strike and gain market share from competitors. One needs to double down when they see their competitors slowing down or closing down. The returns from such a strategy may not win big returns right away, but its long term impact would be significantly positive.
Warren Buffet said it right “Be fearful when others are greedy, but be greedy when others are fearful”
So, should SEO agencies offer Discounts?
The answer would be that it depends, it will depend largely upon the financial stability of the clients and the planning that one undertakes.
The impact that the pandemic is having on different industries i.e. whether positive or negative will also play a major role in decision making.
But a long term strategy adopted with discipline would always allow businesses an opportunity even in these tough times to outshine their competitors.
Many fall into the trap of going for short term gains, but planning for a long term strategy would be something that would separate the winners from losers when we come out of this.
We hope the coronavirus passes away soon and life gets back to normal. Till then do not be fearful to double down. Be safe and stay indoors.
- Quelch, J., 2020. How To Market In A Recession. [online] Harvard Business Review. Available at: <https://hbr.org/2008/09/how-to-market-in-a-recession> [Accessed 18 April 2020].
- Businessinsider.com. 2020. Coronavirus: Business & Economy | Business Insider. [online] Available at: <https://www.businessinsider.com/coronavirus-business-impact?IR=T> [Accessed 18 April 2020].
- Wordstream.com. 2020. Marketing During COVID-19: 4 Essential Copywriting Guidelines. [online] Available at: <https://www.wordstream.com/blog/ws/2020/04/02/marketing-during-covid-19> [Accessed 18 April 2020].