Dentsu Sees Shift In Search Based On Coronavirus

Protective equipment is currently the hottest merchandise online in China, with facial masks, 75% alcohol and disinfectant all going out of stock.

Ecommerce platforms continue to roll out new policies to answer the increasing demand for information and products, as more consumers remain at home and rely on the internet and search.

Products also include larger items such as home appliances and exercise equipment, as well as digital such as movies and short-form video, according to Dentsu’s nCoV China Update published earlier this month.

The report, titled "The 2020 Coronavirus outbreak: Implications in China market and how should brands respond," examines the economic outlook and immediate consumer impact.

The report notes that daily search trends have shifted significantly in China.

And while “big news moments” in the battle against the virus create a clear demand for information, those searching online also look for daily news. Kobe Bryant’s untimely death saw huge interest based on searches, along with major technology and business announcements.

The release of the movie "Lost in Russia" through online video and Douyin saw this title dominate entertainment searches.

Categories with the biggest spending, such as Pharma, Food & Drinks, should be less affected in the short and long term, but for ad spending coronavirus is impacting Retail and Tourism, according to Dentsu.  

Last week during Trivago’s fourth-quarter earnings call with investors, CEO Axel Hefer admitted the company is seeing “softer business,” a drop in revenue specifically in Asia-Pacific, but it’s unclear what the long-term actual impact will be.

Expedia Acting CFO Eric Hart during the company’s latest earnings call said that “the coronavirus outbreak is adding further pressure on the top and bottom line in Q1. Based on the current trends, we expect approximately $30 million to $40 million impact to adjusted EBITDA in Q1, and we expect some impact beyond Q1 and 2020 as well. But, the exact amount will depend on how long it takes for travel trends to normalize.”

It may not work for the travel industry, but for other areas Dentsu suggests moving offline activities online, increasing investment in short and live content, increasing engagement by distributing online video, creating content with in-depth product education through the creation of ongoing content topics that includes health and wellness, focusing on managing CRM data and managing private traffic, and future-optimizing ecommerce media investments and analytics tools.

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