Clues Emerge On Coronavirus Ad Impact; Holding Cos Push Back On Cannes

Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here.

News Pile On

Media companies and tech platforms are seeing more site and app engagement during the coronavirus epidemic, but revenue is not rising with supply. Facebook said messaging across its apps is up 50% in countries hit by the virus, but monetization is rolling back, largely because group chats and other popular services for people in lockdown don’t have ad inroads. “We don’t monetize many of the services where we’re seeing increased engagement, and we’ve seen a weakening in our ads business in countries taking aggressive actions to reduce the spread of COVID-19,” according to a Facebook blog post this week. Twitter likewise has booming engagement but lowered its earnings forecast. Facebook and Twitter account for decreased demand by reducing their ad supply, so the auction remains relatively stable (the plus side for users is fewer ads, which is partially why these platforms feel more like their older, pre-IPO selves). But publishers like The New York Times must invest more to produce content advertisers won’t support. Some brands, such as travel or hotel companies, are being crushed. Others are simply “leery of news outlets and social media sites because there is so much negative content right now,” The Wall Street Journal reports. More.

The Festival Cannes Wait

Holding companies are pushing back against parent company Ascential’s decision to hold the Cannes Lions International Festival of Creativity in October this year, citing both health and reputational concerns, Business Insider reports. Organizers of the festival, the ad industry’s biggest annual event that normally takes place in June, pushed the festival back to October in light of the coronavirus pandemic. But the biggest holding companies are thinking about sitting out the October event and asking organizers to hold the awards virtually this year. In addition to safety concerns, these companies don’t want to be seen partying and yacht-hopping on the French Riviera in a financial downturn that will likely force them to lay off staff. Agencies also stand to save a lot of money by skipping Cannes this year. The major holding companies, which are in early talks with Ascential and vendors about getting refunds on their investments, spend roughly $20 million on the festival annually, accounting for 90% of some companies’ annual travel budgets. More.

Sing For Their Supper

The coronavirus pandemic is spurring Spotify to release a new fundraising feature that musicians have clamored for for years; direct donations. Spotify will promote and match donations to relief groups such as MusiCares and Help Musicians, that support musicians in financial need. Read the announcement. But Spotify quietly mentions in a separate blog post that it is “also working diligently to launch a feature that will enable artists to fundraise directly from fans during this challenging time.” The tool isn’t ready yet, but artists can sign up to be part of the program when it launches, and will be able to use it to raise money for themselves, another musician or a verified nonprofit. The language in the post (“during this challenging time”) implies the feature will last as long as the health crisis, but Spotify may face pushback if cash-strapped artists earn significant direct revenue from fans on Spotify. The streaming service won’t take a cut of the direct fundraising.

But Wait, There’s More