SEO and COVID: The impact of COVID-19 on Online Businesses

The impact of COVID on Online Businesses

SEO AND COVID

One year into the global pandemic: what's the impact of COVID on online businesses?

For the last couple of years, the world has experienced a rollercoaster of events. In March 2020 a global pandemic kicked off forcing the world to adjust, while we tried to cope with self-isolation, travel restrictions and furlough schemes.

But, as strange as this may seem, we’ve also seen some other companies that knew how to adapt in record-time and were even able to steadily grow through the year. 

In this article, we want to analyse some of the businesses that experienced drastic changes, either positive or negative, during 2020.

SEO and COVID research
17/05/2021
Author: topflight Agency
Reading time: 6 minutes

2020 was a pretty bad year for the global economy, especially for industries that relied on tourism and hospitality.

It was also the year of Brexit, that generated a huge backlog for the logistics and manufacturing industries, who were unable to keep up with their weekly supplies, due to the changes in the border legislations.

 

On the other hand, there were a handful of businesses that blossomed under these difficult circumstances and managed to increase their revenue while the rest of the world was struggling.

Companies like Amazon, Tesla, Just Eat and Tesco saw a big increase in sales caused by the changes in buying patterns experienced during and after the COVID-19 pandemic.

On a larger scale, search engines have seen an impressive increase in movement, accounting for a massive 27% of total UK traffic to the top 100 in 2020, says a study by the UK Domain. This includes websites such as Bing.com, Google.com, Yahoo.com and Duckduckgo.com, the latter of which appeared in the top 100 for the first time.

 

In this article, we analyse 6 B2C companies that either benefited or were harmed by the global pandemic based on a broad number of metrics such as organic visits pre-COVID, ROI, digital marketing presence and many more.

 

Ready to start? Let’s go:

Online businesses affected by the COVID-19 pandemic:

Online businesses affected by the COVID-19 pandemic:

PRIMARK

I know, Primark is not an online business. But their case is really worth the inclusion, so we’re going to analyse it first.

Before 2020 the Swedish fashion retailer generated a revenue of 7.79 billion pounds. They’ve been relying on the infamous “fast fashion” business model, which is based on selling cheap clothes that lack quality but can be produced at a large scale.

Over the last 10 years, Primark has increased its share of the UK apparel market by more than 2.5 percent. As of 2018, it ranked as the second largest clothing retailer in the UK, following Marks and Spencer, with a market share of approximately seven percent.

 

But there’s a huge aspect that differentiates Primark from the rest of the clothing retailers across Europe: they don’t sell online.

And this follows a very simple logic.

Primark receives millions of returns everyday. Imagine all the logistics and human work that it would require to do that if they had to sell online.

 

John Bason, finance chief at parent company Associated British Foods, explained during an interview back in 2014:

“Look at a £2 T-shirt. Everyone thinks it’s clickety-click but one-third of clothes get returned.

That means someone has to pick it up, someone has to deliver it, someone in the store has to take it back, refold it. It doesn’t work at the lower price point.”

 

It makes perfect sense. But nobody was counting on a global pandemic occurring, that would force most of the shopping retailers to close their physical stores.

Yep, as you probably know by now, that was really bad news for Primark.

As a result of that, the Swedish giant lost more than £2bn (30% decrease) during 2020. To put that into context, they lost the same money an average UK full-time worker would get in 56,460 years!

 

From an SEO standpoint, they were not selling online and everybody knew this, so we’re not going to analyse their traffic metrics. One thing that does stand out is their branding perception.

graph showing the number of users for Primark in 2020

As we can see in the graph above, the number of users searching for Primark decreased, as fewer people were interested in their products, since they were closed.

The very moment the stores reopened, the interest skyrocketed again.

This is quite interesting, as it clearly shows how important it is to define your brand around a business model. Even in one of the worst years of their business history, Primark still retained the loyalty of millions of customers.

 

Conclusions

Despite the terrible year Primark had, we can safely say that they have coped very well with the pandemic. Taking into account the fact that they were making ZERO money for more than a year.

2020 has proven that Primark is using a risky business model that could put them in trouble if any event like COVID ever happens again. On the other hand, it’s pretty clear that people love their products and are loyal to the brand.

BOOKING.COM

Booking.com is a travel search engine that helps people find and compare the best offers for accommodation, flights, car rentals, attractions and more. It started in 1996 as a solution to simplify the tedious process of searching for hotels and quickly grew to become one of the largest travel search engines worldwide.

 

As mentioned earlier in this article, the tourism industry was one of the worst affected sectors after March 2020. According to data by STR, an analytics firm that tracks the hospitality sector, hotel rates fell across all regions in March reaching a 60% difference compared with the same data in 2019.

The business nature of Booking.com, as any other search engine, relies on helping travellers find and compare the best available offers, saving them a considerable amount of time, while getting very accurate results.

But if travel is not an option, then nobody will search for hotels or flights.

And if nobody is interested in what you offer, your traffic will drop and so will all the money you get from commissions and fees.

 

Nowadays Booking.com is one of the key players in the global online travel industry. Between 2007 and 2009, the company’s revenue grew steadily. Similarly, the global revenue of Expedia, Booking.com’s main competitor, rose gradually until 2019, when they reached about 12 billion U.S. dollars.

However, the revenue of Booking.com decreased by 8.27 billion dollars (54.9%) in 2020. More than half of the total turnover.

Their organic traffic also dropped dramatically.

Just before the start of lockdown in the UK, Booking.com was averaging just over 100 million users a day.

Since then their numbers started to plummet – apart from the summer season – and reached 59M in April 2021, their lowest traffic levels since 2017.

graph showing BOOKING.COM's traffic during the COVID-19 pandemic

With the travel rules set to change from this month, we’re likely to see these metrics rise again but, from the results above, we can see that 2020 was not a good year for Booking.com.

 

Conclusions

Booking.com, like many other travel businesses, had one of the worst years ever in 2020.

Having a fully digital business model brings some risks. But, at the same time, it’s much more flexible to rebound from them.

I expect to see the rankings and revenue from Booking.com rise again this summer as more people are waiting – and able – to travel abroad. Although, they will need months to recover their metrics from before the pandemic.

MAC COSMETICS

We all hate wearing masks, don’t we? Well, probably nobody is hating face masks more than the cosmetic industry.

Why?

Simply because people is wearing less makeup as half their face is covered by their mask.

 

Since the start of the COVID-19 pandemic, multiple countries imposed mandatory use of face masks. Some countries like Spain or Italy even require the use of masks outdoors.

This, of course, was a big blow to the cosmetic industry. According to the Global Cosmetic Industry, 26% of regular makeup users have completely stopped wearing makeup and 21% only wear makeup for video calls.

 

MAC, like many other premium cosmetic brands, have had a decrease in sales since the implementation of face masks. The good news? They were able to swift the balance to promote eye makeup. Makes sense, right?

If you look at MAC’s website, it clearly shows that they’re trying to promote their eye-related products to compensate for the losses generated by the rest of their catalogue.

MAC Cosmetics' website

Let’s now analyse their traffic results.

As we’ve seen in the previous examples, the traffic trend falls after March from 288,000 daily users to 134,000 just three months later, which is a 53% drop.

graph showing MAC Cosmetics' traffic during the COVID-19 pandemic

Once the restrictions start to ease, we can see a sharp increase in visits that repositions MAC’s traffic again into normal figures.

 

Conclusions

The makeup industry has not suffered directly from the COVID-19 outbreak, but more from the health measures imposed to fight the pandemic. In any case, most of the big brands have seen a substantial decrease in organic traffic and online sales that is set to remain in low figures at least until the end of the year.

While facemasks are likely to remain with us for the foreseeable future, most brands will keep putting their marketing efforts into the eye products.

NETFLIX

Earlier last year, after cinemas shut and people were forced to stay at home due to COVID 19 restrictions, Netflix.

Tens of millions of people joined the streaming service in search of entertainment, sometimes canceling their TV subscriptions in the process. Viewership grew so quickly that Netflix and some of its peers temporarily had to downgrade European viewers’ streaming quality to cope with bandwidth limits!

According to the BBC, Netflix gained 16 million new users in the first three months of 2020. That is almost double the new sign-ups it saw in the final months of 2019.

Their revenue also increased following the pandemic going from 1.8B dollars to 2.7B (33% increase).

Regarding their online visibility, Netflix has seen a steady increase in organic traffic throughout 2020, jumping from 14M users in April 2020 to 19M in the same month this year (27% increase).

 

Conclusions

While the world was confined at home, the online entertainment companies were deploying large marketing campaigns to captivate users. This was not only the case for Netflix. HBO, Disney+ and Amazon Prime also increased their users.

Now the problem seems to be the lack of series.

Well, that’s what happens when your content has to be physically recorded.

AMAZON

One of the very few businesses that saw a very positive increase in sales and traffic during 2020 was Amazon. And, when I say “positive increase” I’m really falling short in capturing the magnitude of their success.

As per a New York Times study, Amazon reported a near 200-percent rise in profits, accelerated by the global shift to exclusively online shopping. Amazon’s sales were US$96.1 billion, up 37% from 2019, with profits rising to a jaw-dropping US$6.3 billion.

The pandemic hasn’t only increased the company’s profits but also its expansion. Amazon expanded its fulfillment infrastructure by 50% in 2020, adding more than 250,000 employees in the process. For the first time in the company’s history, Amazon now employs more than one million workers around the world.

If we have a look at the different online stores Amazon has around the globe, the United States was Amazon’s biggest market in 2020, with 263.5 billion in net sales. Germany was ranked second with 29.6 billion U.S. dollars, ahead of the UK with 26.5 billion.

On the SEO side of things, Amazon increased its traffic by a stunning 40% (13 billion users) compared with the previous year.

In January, total visits to Amazon were up 20% compared with January 2020 and up 37% compared with February 2020, according to an analysis conducted by Digital Commerce 360. The biggest year-over-year gain in traffic was in October, when total visits to Amazon jumped 27% compared with October 2019.

That shift is due to Amazon’s annual Prime Day sales event that was held in October last year, months after its typical July time slot.

 

Conclusions

The shift towards online living during the pandemic resulted in a huge increase in the use of e-commerce sites such as Amazon. This change in behaviour allowed online stores to exploit their revenues while physical stores struggled to cope with the lack of sales.

Although the end of the global outbreak is near, this shift in shopping behaviour could become permanent, as most retailers are investing in e-commerce platforms.

MAYO CLINIC

The Mayo Clinic, a health system based in Minnesota with a global reach and high presence in the UK, has always been well-known for using digital marketing to increase its client base.

As you would expect, COVID-19 resulted in huge traffic increases for health-related websites and corporations. In the early stages of the pandemic, more and more people started to question how serious the disease was and how they could prevent themselves from catching the virus.

 

Mayo Clinic did a terrific job of developing a comprehensive Digital PR campaign that consisted in creating and distributing several researches and studies to give information, not only to their patients, but to every user searching for information.

Thanks to those research articles they were able to place more than 10,000 COVID-related keywords consistently on page 1 of search results, which drove an immense amount of traffic, as we can see in the graphic below.

Graph showing the organic results from Mayo Clinic during 2020

In terms of global traffic, they also experienced a huge increase during 2020 and early 2021, jumping from 3.6M users in February 2020 to 6M users in March 2021 (66% increase).

Finally, if we analyse how that traffic translated into revenue, Mayo clinic reported $3.65 billion in revenue for the third quarter, a 7.4% boost over the same period in 2019. But overall Mayo Clinic’s profits are down for the year so far.

For the first nine months of 2020, Mayo reported a revenue of $9.98 billion which was a 1.5% decline from the comparable period in 2019.

 

Conclusions

The Health industry was shaken by the global crisis and most of the businesses operating in this area saw a profit decrease year on year. For Mayo Clinic, despite their excellent content marketing campaign, the global result after-COVID was negative. This was likely because of the medical pressure suffered in their clinics around the globe.

Hospitals across the world had to cancel or postpone elective procedures and patient volumes plummeted as people were afraid to go to the hospital for fear of contracting the virus.

Mayo Clinic said they took appropriate measures to respond to the revenue drops, reducing its “supplemental and contract workforce, halting most construction projects, deferring or delaying most strategic initiatives and announcing temporary salary and staff reductions.”

So, what’s the general conclusion of this research?

So, what’s the general conclusion of this research?

SEO is more important than ever.

While the coronavirus outbreak has increased internet usage exponentially, it has also caused search traffic to business websites to drop in many industries.

Does this mean that SEO is useless for your business right now? Absolutely not.

SEO could be a great solution for businesses experiencing the financial burdens and slower pacing of COVID-19. It can also help you to become more visible for the searches being performed now, and to set yourself up for success once search behavior normalises.

Make SEO your main priority in a post-COVID world.

Sources: Statista, STR