Agencies are not the only ones that are said to be struggling with ad payments to Google and Facebook during the COVID-19 pandemic. Recently, CNBC reported that German travel start-ups have called upon Google to halt ad payments on companies that are receiving financial aid from the government. The letter to Google's chief business officer Philipp Schindler, sent by German Start-ups Association with signatories such as FlixBus, Dreamlines, Tourlane and Trivago, among others, said that the travel start-ups are looking for Google to provide "a consistent and flexible way" for them to postpone and reorganise ad payment terms for fees accumulated in the first quarter.
The travel and tourism industry has been one of the most greatly impacted industries during the pandemic. Airports globally have seen a massive drop in passengers with the likes of Malaysia Airports Holdings' network of airports registering about 137,000 passengers in April this year, which was a 98.8% dip compared to April 2019 and Indonesia's passenger movements also saw a dip. According to The Jakarta Post which quoted data from Angkasa Pura II, the number of passengers dipped by 34.5% to about 500,080 during the second week of its work from home programme.
Singapore Changi Airport saw a 70.7% dip in passenger movements to 1.65 million in March this year compared to 2019. For the first quarter of 2020, Changi Airport, registered 11.0 million passenger movements, a year-on-year decrease of 32.7%. Meanwhile statistics from the Singapore Tourism Board showed that the number of visitor arrivals for March this year dipped 84.7% to about 239,880. Year to date visitor arrivals also dipped 43.3% to approximately 2.7 million.
Likewise, travel firms in Asia have not been spared from the impact. Travel tech and marketing company Sojern laid off 50% of its global workforce last month due to the pandemic. A quick check by Marketing previously found that staff based in Singapore and Hong Kong were also impacted and laid off. Meanwhile, travel activities and services booking platform Klook also streamlined its workforce globally either through temporary leave or headcount reduction. CEO and co-founder Ethan Lin said the move will impact 10% to 20% of its headcount for most functions.
Online travel companies in Southeast Asia that Marketing spoke to said they are working closely with the duopoly in terms of payments and both Google and Facebook have been supportive in its efforts. Skyscanner's spokesperson told Marketing that while the pandemic has created significant impact on many industries worldwide, Google and Facebook, which are partners for their advertising purposes, have been open, transparent and understanding during this time.
"We value our longstanding relationships with Google and Facebook. Both partners have been very supportive with relevant information, optimisation and real-time measurement efforts to help inform our decision making around ad investment," the spokesperson added.
The spokesperson explained that while the industry has slowed down and travellers are unable to explore the world right now, "the collaborative work from both Skyscanner’s in-house advertising teams as well as [its] partners is setting Skyscanner up for success", ensuring the best results and investment when travel does rebound. When asked about the ROI expected from the collaborative work when travel rebounds, the spokesperson did not provide hard numbers but said it is working to ensure that any activity it runs must be relevant and flexible to suit its travellers' needs, especially as the traveller sentiment continues to evolve.
Meanwhile, Busyra Oryza, corporate communications manager at Indonesian online travel company Pegipegi, said it has not reached out to Google or Facebook for help to cope with ad payments during this challenging period. "We always try to settle the payment in a timely manner even during this current situation," Oryza said.
He explained that it is sticking to its spending framework prior to and during the crisis. "We always aim to spend our marketing budget effectively and efficiently to achieve company objective by taking into account, but not limited to, market dynamics, consumer behaviour, and the value that is brought by a particular initiative or marketing channel," Oryza added.
Pegipegi recently reappointed Dentsu Aegis Network’s Happy Marketer, a Merkle Company to drive data-driven marketing for the third consecutive year. Happy Marketer has been tasked to track Pegipegi’s marketing initiatives performance across paid, owned and earned channels and help the travel agency transform, optimise and scale its marketing. The agency is also responsible for driving data-driven marketing for Pegipegi.
Also weighing in on the topic was CMO of Traveloka Dionisius Nathaniel who said the site has revisited all its marketing investments, including those related to Facebook and Google, as it adjusts to the demand dynamics. Separately, it also laid off "a significant portion" of employees as a result of the the COVID-19 pandemic, Nikkei Asian Review reported.
Additionally, it has also been refocusing its efforts to adapt to the shift of users' demands, where the current main priority is to stay safe, resulting in changes on their travel plans, hence high demand for refund and reschedule requests. Nathaniel said that Traveloka complies and fully adheres to the agreement and policies set and agreed by its respective partners. "Currently, we are in close coordination with our partners to ensure that we are still maintaining our business activities, as we also put our effort into not only taking but also giving insights with our respective partners during this current situation that we are facing," he added.
He also explained that its partnership with all partners have always been beyond ad or media placements. During a challenging time like this, for example, it continuously works to receive and share insights with partners on a continuous basis to enable a better view of the current situation as well as the outlook.
Adapting its marketing and CX
Since February this year, Nathaniel said Traveloka has been facing a significant increment of assistance requests that reached up to 10 times higher compared to a normal situation, with up to thousands of requests every minute from users in various countries. Over the past few months, it has been strengthening its customer care team by reallocating approximately 340 employees who are providing additional support to address the requests from customers.
Separately, Skyscanner is offering regular guidance to travellers on the changing landscape as often as possible through messaging on its home and search pages respectively, as well as articles on its site advising of restrictions. As for partners, Skyscanner is providing free trials of its travel insight product to airlines, tourism boards, and other travel businesses, allowing travel providers to analyse global flight search and redirect data. This is to provide valuable insight into market or route trends to help inform business decisions.
To help consumers cope with their change in travel plans, it offers a convenient and seamless refund process, and are focusing on improving products, developing better systems, and remaining engaged with customers through its owned media channels, Oryza explained.
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Google pilots commissions per stay programme for hotels globally
Currently, Google and Facebook are offering ad credits as well as cash grants to help small businesses worldwide. Google announced its US$340 million ad credits scheme for small businesses worldwide on 27 March, adding that active advertisers since the beginning of 2019 will be informed of notifications through Google Ads about the credits. Meanwhile, Facebook is offering US$100 million cash grants and ad credits to about 30,000 small businesses worldwide. The company is still working on eligibility details for all countries except the US, where the cash grant initiative has already come into effect.
Google had previously declined to comment on whether it is offering agency partners extended payment terms during this period. Similarly, Facebook did not respond to Marketing's queries previously about extended payment terms.
However just recently, Google announced that it is piloting a commissions (per stay) programme allowing hotel ads partners to pay a commission only if a traveler stays at the hotel, automatically adjusting hotel ads bids to maximise booking value. In an update by group product manager, travel ads, Michael Trauttmansdorff said the programme is now open for global participation by all hotel ads partners.
Meanwhile in April, the company partnered with UOB in Singapore to launch the new curriculum for the SME Leadership Academy training programme which was customised to help business leaders of SMEs from the retail, tourism and F&B sectors respond to the challenges posed by the pandemic. The training programme is done in collaboration with the Economic Development Board and with the support of the Singapore Tourism Board Marketing College, Enterprise Singapore and Singapore Retailers Association. Topics for the programme include Asia Pacific travel trends in light of COVID-19, getting your business online, and managing through ambiguity. UOB will also guide SMEs on how to apply for COVID-19 financial relief assistance to help tide over during this period.
Similarly, Facebook also tied up with the Singapore Tourism Board Marketing College and Enterprise Singapore to organise a series of training sessions via webinars to help SMEs to cope and ramp up their recovery. The webinars are catered to sectors that were most affected by the economic slowdown - travel, hospitality, retail, events. To date, Facebook has had three sessions and an average of 720 participants per session.
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Caught in the middle: Agencies struggle to pay FB and Google for client work
Analysis: Malaysian publishers next to demand FB and Google share revenue
How Malaysian agencies can negotiate on delayed payments
How Traveloka uses content during a crisis to aid its customer care team