Despite more eyes being glued to screens and content than ever before from people staying home during the COVID-19 outbreak, advertisers are pulling their ads from digital and traditional platforms at a rapid rate.
According to Axios, analysts from the Cowen & Co. investment management company predict Facebook and Google will lose over $40 billion in combined advertising revenue in 2020 due to the coronavirus pandemic. These companies, which operate a huge chunk of advertising space online and on social media, are both projected to fall over 18 percent short of their initial ad revenue forecasts for the year.
A majority of digital ad space is bought by small businesses. With many looking for any ways to cut costs, digital advertising is an area small businesses are scaling back on – especially if they’ve been forced to close their physical retail spaces.
Still, while big tech companies may feel the brunt of the damage to digital ad revenue losses, analysts believe companies like Facebook and Google won’t be too weakened by the crisis thanks to a diversity of other products and services. However, growth is expected to be greatly curtailed relative to previous years for the tech industry.