At an aggregate level, CPCs for Google Shopping and text ads are continuing a weekslong YoY downward trend, most recently at -18.5%. While the details vary per industry, there are no major exceptions to the trend, but rather variations on it: for example, consumer electronics exceeds the average decrease at -30% while health & beauty remains a bit closer to the 2019 benchmark at -11%.
With lower CPCs and many commercial activities limited to online by physical store closures, it’s no surprise to see a run on costs across most advertisering verticals. This in turn has yielded strong weekly developments in YOY impression and click volume.
But how are those clicks performing? Conversions remain a bit more variable at the moment, recently trending downward. Looking at click-through-rates and conversion rates, we can see this outcome is due to weekly decreases in YoY conversion rate performance, , finally sinking below the YoY benchmark in Week 17. It’s certainly possible that advertiser spend is currently beginning to outpace consumer demand. Additionally, it could well be that consumers stuck at home are starting to shop in a more casual or passive manner, potentially losing willingness or cash reserves to buy non-essential items as the crisis prolongs.
Whether this downward trend in conversion rates will continue remains to be seen. Check back weekly for the latest metrics and at least bi-weekly analysis
Compared to last week we can't spot any further developments which aren't already covered by our last analysis. The developments are slowing down and therefore we will publish our analysis in a bi-weekly schedule until further notice. We are still constantly surveying everything and will of course let you know immediately if something is up.
At an aggregate level, Google Shopping and paid search have continued an enjoyable weeks-long decline in average CPC. However, the COVID-19 conversion bubble seems to have burst – despite elevated YoY impression and click volumes. This development has been driven of course by a downward trend in conversion rates, which had spiked immediately after lockdown but then slowly deflated every week since. This strongly suggests that consumer urgency and purchasing intent is diminished, perhaps reflecting a decrease in non-essential shopping as unemployment rates remain at historic highs. As European economies increasingly ease out of lockdown, it could be that conversion rates will improve in coming weeks.
Note that these trends will vary according to industry and geography among other factors. For fascinating examples, have a look at Health & Beauty or Pet Care in Shopping – or alternately, Pharmacy or Tickets & Events in paid search.