Due to uncertain economic conditions, managing PPC is an uphill task. Are experts concerned about the economy relative to the industry as we approach Quarter4? Are their clients bringing up any economic concerns? Are PPCers seeing any impact on the accounts they handle? These were the questions for which host Julie F Bacchini sought answers from PPC experts.
Q1: Are you concerned about the economy in general as we head into Q4? If so, why and what is most concerning? And if not, why not?
Yes, I am concerned about the economy. While we may or may not have officially met the definition of recession, there are quite a lot of negative forces in play right now. Expecting some to want to pull back and others to stay the course or increase. @NeptuneMoon
I am not because ads still will run and ROAS targets will still apply I also find even in a downturn consumers still buy, maybe less. Now ask me as a shareholder vs a marketer my answer changes to some concern. @runnerkik
Yes. People are struggling in various ways right now, so we may need to pivot some strategies. And I expect ad spends to either contract or get more cautious. @JuliaVyse
Yes. In recent times, most of the companies are facing a lack of customers and demand of their solutions which is making their pipeline dry. Its effects are showing on the cost-cutting in marketing operations and the firing teams. @1tagupta
I think high CC debt and payment plan adoption shows people are overextended more than economic spending shows. My theory: non-big-promos will struggle for BFCM and then Q1 2023 will be when financial reality strikes for avg consumer and rev will drop more than usual. @PPCKirk
I am also expecting the pendulum to start swinging back to consultants/outside people vs. in-house teams, as it does when the economy weakens. Execs start asking “why are we paying salaries & benefits when we could just pay for the work?”. @NeptuneMoon
People are spending more on necessities and that impacts discretionary income availability. Debt (both consumer as well as medical, student, etc.) is more prevalent. It may be moving slowly, but it’s moving steadily in a bad direction. @robert_brady
Yes, if the special offers I saw over the weekend were any indication, brands are aware of the high competition coming into the season. @lchasse
Not only this, as a Media Buyer, I’m concerned that business owners think that #ppc can fill their pipeline. They try it, not get good results and be like PPC doesn’t work. @1tagupta
We have seen clients start to pull back on budgets. They’re definitely skittish. @beyondthepaid
I am not concerned. If it’s something that’s out of my control, I can’t worry about it. You try to work and do your best with what you have in whatever the environment. @360vardi
In general yes, and also because of how it impacts our work. Marketing budgets and/or outsourced agencies tend to be the first cuts (whether that’s best for a business or not I think is a different story though). @adclarke10
Different being in a recession as an employer… don’t know what I don’t know. Not shocked where we are as much as just navigating it all. Feels like a slow death is happening some days. I know it will last a couple of years at least. @duanebrown
I think the biggest issue is distortions. Cars are piled up in lots right now because of the big demand spikes surrounding supply chain and covid. @tonyzara
Definitely. One of my clients is already seeing the effect. @TheMarketingAnu
Wouldn’t be a tuesday if I didn’t forget what time this started. Concerned about the economy is a broad question. In terms of it impacting search, yes a bit. But demand is often correlated to unemployment rate, which remains low, so I am hopeful. @JonKagan
Q2: Are you concerned about the economy relative to the industry(ies) you manage advertising for heading into Q4? If so, why and what is most concerning? And if not, why not?
Q4 isn’t big for B2B – it’s usually the opposite – but that said, I’m expecting more clients to want to go completely dark in December. We usually counsel against that but this year we shall see. @beyondthepaid
Yes. my restaurant client is high value, but not necessarily the lowest cost in the game. And a current strike action, directly related to inflation/cost of living is affecting my public sector clients. It’s getting bumpy out here. @JuliaVyse
Good thing I just signed a luxury travel client! nothing to worry about there…@JuliaVyse
When you have a brand with a high price tag it’s more worrisome because the item is seen as a luxury vs a necessity or an investment. @runnerkik
I always say that all industries are run by people. And, people cannot help but bring their feelings about economic health into their decisions. So, I expect to have a lot of conversations about spend and the number of platforms we are on, etc. @NeptuneMoon
Yes. With advertising platforms bringing updates almost every day, the results are fluctuating in every industry and sometimes it gets hard to forecast monthly performance. It’s the same in all the industries but I’m concerned about the CAC & quality for b2b lead gen. @1tagupta
My client portfolio is diverse enough that while some will slow down, others will stay strong. I’ll be okay, but it will be tough for lots of people. @robert_brady
I’m not worried – more opportunistic. Any time change happens, there’s an opportunity…and honestly, I’m hopeful that this shakeup helps to re-center paid media around things that matter vs. things that go up and to the right. @DigitalSamIAm
I expect a pullback from optional healthcare – cosmetics / etc. @Galliguez
Yes and no. It puts a lot of pressure on us to do better to win, but it will get better and honestly, this is where we earn our paychecks. It is easy to get good results when things are awesome. @lchasse
We have the added headache of data for the last 2 years being a hot mess too… Industries that thrived in peak COVID are cooling, in some cases pretty rapidly, while others are coming back steadily. @NeptuneMoon
(Kind of addressed in my first answer too): Yes, bc marketing budgets seem to be looked at as an easy area to cut costs. The most concerning part for me is that a lot feels out of our control. @adclarke10
For example, a company’s CEO suddenly decides to terminate contracts with all their agencies, no matter the results that are being driven & without consulting anyone that actually works on the project. @adclarke10
If your brand is offering something related to the 7 deadline sins. I can see the brand doing well in a recession. People have habits and some won’t change during a recession. Would love a pet or candy-type client. @duanebrown
And by the deadline I mean deadly. Those 7 deadly sins: Lust Gluttony Greed Sloth Wrath Envy Pride. @duanebrown
Yes, but not for the reason you think. A lot of the brands I work with are vices (i.e. QSR, booze, etc). Economic uncertainty leads to stress, which drives up demand, and then I am left wondering if I am underfunded. @JonKagan
Q3: Are your clients or stakeholders bringing up any economic concerns? If so, what are they most worried about heading into Q4?
Yes, we run scenarios for different cut levels for sure. Also, a few clients running summer sales and moving media dollars up to see what happens now vs holding back for cyber and holidays. @runnerkik
Everyone is bringing it up related to Q4/Black Friday. Some asked about next year and we are thinking about it. Don’t over-order and sell out of everything. Cash in the bank is everything. @duanebrown
We’re often the ones bringing it up to them. They know what’s up, but we’re the ones connecting the dots to how we manage their investment in media. @JuliaVyse
We’ve had conversations about the economy with each client. More about, how to plan not to cut budget, but to allocate it appropriately to achieve the goals and how the business can measure the impact. @360vardi
I believe in being proactive and broaching the topic, even if they are not bringing it up. I’d rather guide the conversation than have conversations happening that I am not a party to that end up with a decision that impacts me/my work! @NeptuneMoon
Some are — it’s an inevitable topic. In general, most of it is focused on opportunity vs. reduction. When competitors start going dark + cutting media, that’s the time when CPMs drop + CTRs increase. @DigitalSamIAm
It’s really more of being extra sure of the value of what they’re spending on. Search continues to do well b/c it’s intent driven. Other channels are more affected. @beyondthepaid
Yes! In B2B the key discussion has been retention, cross-sell and upsells. @andreacruz92
That being said, some are modifying strategy + product mix to lean into higher profit centers (i.e. focusing on first-sale profitability, or higher-margin services) — which can make plenty of sense depending on the business + the underlying data. @DigitalSamIAm
And then there are a handful of clients who are actually *increasing* budgets and *increasing* CAC targets, in an effort to pick up incremental new customers at what they project to be a discount relative to their actual value. @DigitalSamIAm
This is a great time to be keeping a close eye on your Auction Insights to see who is pulling back, who is holding steady, and who is adding spend! It can be a useful tool to keep your initiatives going. @NeptuneMoon
We discuss the topic, but it is not paralyzing any brands. We discuss what opportunities we may have because of it, which is what we should be looking at. In B2B it is really not an issue yet (except for folks who support auto). @lchasse
They’re concerned about this, might not be proactively speaking. I try to introduce this topic in our conversation. Usually decision makers like VP or Director of marketing so they do see where their outsourced marketing efforts are heading towards. @1tagupta
Scaling on any ad platform with consistent results, doing omni channel targeting, scaling across different platforms and retargeting the existing users are some of the topics I have noticed in our marketing conversations. @1tagupta
Yes, most clients have been asking for more granular reporting so they can know exactly what is/isn’t working. We already do this in our usual reporting, but we’ve gotten a lot more questions/requests about specific keywords, services, targeting, etc. @adclarke10
Surprisingly no. Maybe 5% of them have. We end up bringing it to them. @JonKagan
Economic chat wise we’re facing a double hit here of the impending recession and Brexit. Still, a few clients facing stock backlogs due to Brexit issues which is massively frustrating. @PPC_Fraser
Q4: Are you seeing impacts in your accounts that you think are due to economic factors? If so, what are you seeing, and on which platform(s)?
Totally are, especially for one of our women’s shoe brand. Even seeing the impact on our Amazon business. People will spend less next year. Why should they spend it with you? Brands will start to have to answer that question if they are not already. @duanebrown
The aforementioned Auction Insights have been all over the place in Google Ads the past few months. CPCs continue to increase, not holding my breath for big decreases even if auctions on platforms are less crowded. @NeptuneMoon
Amazon is in ALL of my auctions. even my public sector ones. They see this contraction as a major opportunity. @JuliaVyse
Absolutely, the discretionary income folks have has gone down a lot. The recession and the crazy inflation have impacted the extra money families have for retail items. We have to have the right product and be the right brand for consumers. @lchasse
I mostly work with @GoogleAds and @MetaforBusiness for both ecom and lead gen. Metrics like CAC and Conversion rates have spiked and metrics Click to lead/sales, Lead to deal, Conversion Value, etc have decreased as people are limiting their spend on “wants”. @1tagupta
So far, only 5% of our clients have seen any kind of impact, and that is more of a pandemic recovery impact than a future economics fear scenario. @JonKagan
Q5: Are you proactively doing anything in your accounts due to economic conditions or concern over economic conditions?
*Updating the negatives to be even broader. adding in collective action/strike negatives. *Renewing a lot of the 1st party data discussions. @JuliaVyse
I am being even more aggressive in trying to do what I still can to eliminate poor-quality traffic. Not that efficiency doesn’t always matter, but when things are tighter/under more scrutiny, the more you can say you’ve done to be proactive, the better! @NeptuneMoon
Reviewing the marketing calendars together just to ensure we are buttoned up. Also reviewing products for any inventory flags or worries. @lchasse
Making sure conversion tracking is as accurate as possible so we have the best insights for the results being driven. Also reviewing keywords & structure for opportunities to refine, expand, or double-down on different products/services. @adclarke10
Ensuring conversion tracking is buttoned up, including importing Salesforce or other down-funnel lead data. @beyondthepaid
Shifting ad spend around. Focusing on different products to sell. Making sure we stay profitable as we spend money. @duanebrown
Literally, all of our clients have a contingency plan ready to go, if things hit the fan. It is either revenue-driven or ROI driven and will last 2-4 fiscal quarters. @JonKagan
So *spicy take* – if you’re making performance changes (i.e. keywords, negatives, data, audiences, bidding strategy, etc.) to accounts due to economic conditions – you might be doing the wrong thing. @DigitalSamIAm
Obviously, if you have a shifting strategy due to economic conditions, then changes are warranted. But if you’re just now getting serious about (for example) negative kws, umm….pretty much the same as going for your first training run the day before a marathon. @DigitalSamIAm
The best defense for any type of disruption is to be brilliant at the basics – and that doesn’t happen overnight. The people who are best prepared to succeed during the coming storm are the ones who have been preparing for it day in and day out for years. @DigitalSamIAm
PPCChat Participants
- Julie F Bacchini @NeptuneMoon
- Sarah Stemen @runnerkik
- Julia Vyse @JuliaVyse
- Ekta Gupta @1tagupta
- Kirk Williams @PPCKirk
- Robert Brady @robert_brady
- Lawrence Chasse @lchasse
- Melissa L Mackey @beyondthepaid
- Daniel Vardi @360vardi
- Ashton Clarke @adclarke10
- Duane Brown @duanebrown
- Tony Zara @tonyzara
- Anu aka PPC Live UK founder @TheMarketingAnu
- Sam @DigitalSamIAm
- Dave Galliguez @Galliguez
- Andrea Cruz @andreacruz92
- Fraser Andrews @PPC_Fraser
- Jon Kagan @JonKagan
Related Links
Stop the wasted ad spend. Get more conversions from the same ad budget.
Our customers save over $16 Million per year on Google and Amazon Ads.