With out-of-home activities on the back burner until further notice, consumers are increasingly turning to contactless services and online shopping. As a result, ecommerce is on track to have a huge year. According to WARC’s latest global ad trends report, the pandemic will lead to an additional $183 billion in online spending in 2020, while overall ecommerce sales are projected to grow by 30.4 percent to $2.9 trillion.
Brands are prepared to spend big to reach online shoppers. WARC’s data show companies will invest $59 billion in ecommerce advertising this year, driven by an increased use of lower-funnel tactics.
Ecommerce ad spend shows no signs of slowing down. Advertising across ecommerce sites, omnichannel retailers and social commerce is growing 30 times faster than the wider online ad market, the report found.
That upward momentum is likely to continue, as research from McKinsey & Company shows 21 percent of Americans have tried a new digital shopping method since the pandemic and 80 percent intend to continue the usage beyond the crisis. In addition, many have found new places to shop via a digital channel, including an online ad (23 percent) and social media post (16 percent).
The report also provides insight into how Alibaba and Amazon’s ad businesses, respectively, are performing in the age of coronavirus. Growing 4.5 times faster than Facebook’s and 63 times faster than Alphabet’s, Amazon’s ad business is expected to be worth $18.1 billion this year, up 35.6 percent from last year.
Alibaba’s ad business, the third largest in the world, is set to make $23.5 billion from selling ad inventory across its ecommerce properties this year, a 6.6 percent increase from 2019.
Lastly, WARC found that livestreams are bolstering China’s ecommerce sales and growing to account for a fifth of the country’s ecommerce. Taobao, TikTok and Kwai—the largest three livestreaming platforms there—accounted for 69.1 percent of livestreamed sales this year.
