According to eMarketer, US spending on search advertising will fall by between 8.7 percent and 14.8 percent in H1 2020, $6 billion to $8 billion less than the researcher previously expected on March 6—a 14.4 percent increase in search ad spending for 2020.

A closer look reveals that search ad spending was uniform in Q1 as a result of stable performance in early 2020. However, ad investments in Q1 saw a year-over-year spending increase of 2.8 percent and a decrease in 0.2 percent, indicating major spending cuts started in March.

EMarketer estimates ad investments in Q2 will decline by between 20.2 percent and 29.4 percent on a year-over-year basis, with the most dramatic reduction in spend from travel advertisers and the media and entertainment industry. The impact of the lowered search ad estimate in H1 will vary from sector to sector.

Though search is often viewed as recession-proof, the current crisis is impacting the performance marketing channel in two ways: Many of the conversions that would occur as a result of search are affected by business closures and stay-at-home orders, causing inventory shortfalls. Additionally, search budgets can be paused or pulled at any time because they aren’t committed in advance.

Amazon’s decision to suspend shipment of all non-essential products, as a result of the coronavirus pandemic, has made it difficult for consumers to buy multiple items online. This is decreasing the share of search ad spending ecommerce activity usually drives.According to tinuiti, since the end of January Amazon has been dramatically pivoting away from Google Ads across a variety of product categories, and as of March 11, has turned off all of its text ads.