The Impact of COVID-19 on Apple Search Ads

Since the beginning of 2020, the whole world has been all about the outbreak of the coronavirus, also referred to as COVID-19. Labeled a pandemic on March 11, the epidemic affects practically every country and every individual, changing the way we interact, work, study, entertain ourselves, shop, work out, etc.  

The mobile marketing industry has also experienced the effects of COVID-19. Social distancing policies and other restrictive measures imposed by governments globally make people isolate and look for ways to pass their time under quarantine. It’s not surprising that there’s been an uplift in daily hours spent in mobile across multiple countries:

In the chart above you can see the countries split into three phases. These are waves of the coronavirus spread with China being the most affected region. 

We’ve decided to take a closer look at the impact of COVID-19 on Apple Search Ads specifically, taking into account the phases of the coronavirus spread. We can’t research China, because obviously Apple Search Ads is unavailable there. So we focused on the following storefronts:

• The 2nd phase countries affected: South Korea (KR), Japan (JP) and Italy (IT); 
• The 3rd phase countries affected: the US, the United Kingdom (UK), Spain (ES), France (FR) and Germany (DE).

The research is aimed to: 

1. Understand how the coronavirus outbreak has affected key Apple Search Ads metrics (Downloads, CPA) in different regions, especially the worst–hit countries;

2. Understand how the outbreak has affected user behavior in different categories (Games, Work from Home, Photo & Video, etc.).

3. Check whether there is a growth in the usage of entertainment and remote collaboration apps;

4. Confirm the expected dramatic drop in the usage of travel apps and booking apps for offline events.

To understand the impact of the coronavirus on Apple Search Ads, we’ve researched 6 category groups: 

1. Games
2. Work from Home: Education, Business, Utilities
3. Photo & Video
4. Health & Fitness
5. Finance
6. Travel, Transportation, Booking

If you feel like comparing your performance with Apple Search Ads Benchmarks in Q2-Q4 2020, get our free report: 

1. Games

Sample:

• The 2nd phase countries (KR, JP & IT): 36 apps, 14.4M impressions, 249K downloads.
• The 3rd phase countries (US, UK, ES, FR & DE): 67 apps, 36.5M impressions, 821K downloads.

While being under quarantine, people seek ways to stay entertained and connected. As expected, games appeared to be one of the key ways to pass time while social distancing. 

So, in Gaming, we’ve seen a significant increase in Downloads in both country groups. They follow the same exponential trend, but the countries most affected by COVID-19 are the bigger game downloaders. See for yourself: 

From the charts above, you can see that a huge uplift in downloads starts at the beginning of March 2020 for both country groups.    

South Korea (SK), Japan (JP) and Italy (IT) have downloaded remarkably more games compared to the 3rd phase countries: the boost in Downloads is 60% against 27% respectively.

We’ve also looked at the changes in Cost per Acquisition (CPA) in the Gaming category for both country groups. 

In the 2nd phase countries, CPA has slightly increased by 10-20%, which is likely to result from more aggressive bidding strategies that publishers are adopting. Companies are aware of the situation and understand that they can seize the moment. Therefore, UAs are increasing bids, which intensifies the competition:

As for the 3rd phase countries (US, UK, ES, FR, and DE), the current CPA  trend is stable. While people are downloading more games, advertisers don’t raise their bids. 

However, this is just a matter of time: publishers are likely to start raising their bids to win users, which may bring about an increase in CPA. But until this occurs, there is an opportunity to scale to these storefronts.

Scaling Apple Search Ads for gaming publishers is usually hard, but this is the perfect time for them to try that. Moreover, it makes sense to plan marketing activities in these storefronts now, as it can result in a major further boost. 

2. Work from Home: Education, Business, Utilities 

Sample: 

• The 2nd phase countries (KR, JP & IT): 27 apps, 21.3M impressions, 789K downloads.
• The 3rd phase countries (US, UK, ES, FR & DE): 50 apps, 47.4M impressions, 2.1M downloads.

With social distancing policies introduced due to COVID-19, multiple companies had to make the switch to remote working for their staff. Consequently, the demand for work from home apps has significantly boosted, and “Zoom” has become the defining app of the pandemic period. 

We took a look at Downloads in this category for the two country groups to find out that in both 2nd and 3rd phase countries the number of Downloads has grown by 120%. As of the end of March, the number of Downloads has more than doubled compared to the period before the coronavirus outbreak.  

Average CPAs for the period are $0.79 and $1.72 in the 2nd and 3rd phase countries respectively. Cost per Acquisition has barely changed, even decreased by 10-15%, which hasn’t been caused by the increase in auction bids but rather by the natural boost in search traffic: