Infographic: The dip in Facebook paid ad spend in 2020

Since the start of the year, brands have been more active in publishing organic content, as the amount invested in paid budgets start looking more and more dim due to economic uncertainty. According to a recent study by Socialbakers, the share of paid posts in Southeast Asia have dropped from close to 25% in January this year to lower than 20% in March. The lowest dip for the region came around 21 January when the share of paid posts dropped close to 20%. Meanwhile in East Asia, the number of paid posts dipped from over 25% in January to less than 20% in March.

On the other hand, organic posts have remained strong, increasing ever so slightly across all regions since the start of the year. 

For Facebook specifically, Socialbakers found that cost-per-click (CPC) costs for the platform has been slowly dipping since the beginning of 2020 across Southeast Asia, East Asia, North America, as well as Western and Southern Europe. The CPC for Southeast Asia dipped from more than US$0.08 in the beginning of this year to close to US$0.04 in March.

 Meanwhile, weekly ad spend in Southeast Asia saw a steep drop from about US$600 to less than US$400 in January.

While ad spend fluctuated, it eventually picked up in March, rising to above US$400.

Meanwhile in East Asia, CPC picked up again in March, rising from about US$0.10 to US$0.15, as businesses started taking off in the region. Like Southeast Asia, weekly ad spend in East Asia saw a drastic dip in January from more than US$800 to about US$500.

In North America going into December 2019, CPC was around US$0.64. By mid-March the data shows that CPC had almost halved to US$0.32. Similarly in Western Europe, CPC was around US$0.43 going into December 2019. By mid-March, Socialbakers' data found that CPC had more than halved to US$0.20.  Socialbakers CEO Yuval Ben-Itzhak said the data reflects what the company has been hearing from brands, that due to economic uncertainty, marketers are slowing down investment. According to him, this trend is expected to continue as businesses search for less costly alternatives to engage their audiences. 

That means that organic strategies driven by the right content may win during this period.

“Since we believe that now, more than ever, customers want to hear from the brands they follow, cutting back on social media investment could be a mistake on the part of the brands. Brand marketers need to be mindful that, faced with the prospect of social distancing and more time at home, their audiences will be looking to the digital world to keep them feeling connected, updated, and entertained," he added.

Separately, Facebook said in a blog post that its business "is being adversely affected" like so many others worldwide. "We don’t monetise many of the services where we’re seeing increased engagement, and we’ve seen a weakening in our ads business in countries taking aggressive actions to reduce the spread of COVID-19," the company added. According to Facebook, messaging has increased more than 50% over the last month in several countries hit hardest by the virus. Similarly, voice and video calling have more than doubled on Messenger and WhatsApp.

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