How Some SMBs Actually Benefited During COVID19

Table of Contents

Australia has been extremely fortunate with how the government has handled the COVID19 pandemic. And even though the nation wide shutdown has definitely been a painful exercise, we have fared far better than some other countries…

Now that restrictions are being progressively lifted, it’s time to think hard about how you’re going to emerge from the economic slowdown.

One of the fascinating things that happened during the toughest parts of the lockdown was the sharp decrease in the cost of digital ads across all the major platforms.

This is in fact something which we can use to our advantage.

Dirt Cheap Digital Ads

Typically if you spend $1,000/mo on ads, and you had an average CPA (cost per acquisition / the cost to get someone to call you or buy something) of $20 then you’d get about 50 conversions.

However during the height of the lockdown the cost of digital ads on Google & Facebook/Instagram dropped by about 50-75%.

This means that with the same $1,000 budget, you’d instead generate about 200 conversions.

Quite a bizarre experience to have a near total lockdown, while at the same time clients getting 3-4 times the number of sales.

So why did the price drop during the lockdown?

Nervous Businesses Pull Their Budgets

When you run digital ads, the cost to run those ads is based (among other things) on how many competitors are also targeting the the same audience, and the price they’re willing to pay.

It’s a little micro auction which sets the price of the ads usually (but not always) on a per-click basis.

When the pandemic was in full swing, many businesses simply turned off their ads.

Businessman in panic

That means competition dropped, and as a result so did the price to run ads.

Those businesses who held their nerve were rewarded fairly quickly with a steep increase in the cost efficiency of their campaigns.

The Current Ad Climate

As restrictions slowly ease back to normal and confidence returns to the market, your competitors will also start to resume their ad campaigns which will push ad prices up again.

In the last week or two we’ve definitely noticed a steady increase in ad prices as advertisers reenter the market, including new advertisers who have been forced to rapidly pivot their business online and embrace digital marketing or disappear forever.

Ad Prices Are Still Cheap

I doubt the price of ads will get back to where they were for quite some time which means that while you may have missed the boat with the super cheap “lockdown ad prices” there’s still plenty of opportunity to be had.

Stuart Brown photo

“One of our clients was getting a 9:1 return on investment before the pandemic so in many cases, ads can deliver a great ROI regardless.”

If you’re new to digital ad campaigns, the best possible time to give it a shot is when prices are as low as possible.

This maximises your chances of success and it’s an opportunity that’s unlikely to come around again, which makes now a great time to get involved while prices are still low.

Move While your Competitors Hide

The pandemic represents a major turning point for many businesses.

Those who can pivot their business and embrace digital marketing strategies will be the ones that survive.

The key point here is to take action while your competitors are likely still hiding and waiting for things to go back the way they were before.

Little superhero

While they’re absent from the scene you have an opportunity to fill the void and be seen while your competitors are absent.

Companies like Toyota and Coca-Cola massively increase their marketing budgets during the great depression.

A move which was against the collective wisdom of their competitors at the time, but which ultimately caused them to steal market share from their opponents.

Being seen as a stable brand in a time of turmoil, not to mention being one of the few remaining brands actually advertising during that time meant that they were able to attract many customers who had effectively been abandoned by the brands they were familiar with.


Your business is a long-term asset and so you should think about your marketing with a long-term vision too.

There’s nothing wrong at all with thinking about short term goals, however your marketing is the mechanism which draws people to your business, and brings money in the door.

Keeping a consistent flow of marketing will ensure that you’re able to ride out the storm with less disruption while other more near-sighted businesses simply never recover.

About the author...
Stuart Brown
Stuart Brown
Stuart is the co-founder of Launch Experts. With 20 years of experience in the marketing industry, his primary focus is to break away from the traditional marketing agency model, ensuring clients get a positive return on investment from their marketing campaigns.