What will be the future for brands in a post COVID-19 world?
The colossal impact of the COVID-19 pandemic has been felt across the globe, redefining economic, political and social landscapes.
Whether businesses are thriving with immediate spikes in demand or struggling to operate, the majority of organisations have been affected and are being forced to quickly adapt. Looking to countries in Asia who are ahead of the curve currently facing Europe and the Americas, their response to this crisis (and the outbreaks of SARS in 2003 and MERS in 2015) can be used to model the changing environments and behaviours that we in the UK are likely to experience in the coming months.
Both brands and agencies alike have been using such learnings to distinguish a set of stages for the pandemic, to map how businesses can appropriately respond to the crisis. A key similarity between many of these approaches is the distinction of how brands should react during the initial outbreak phase and the concluding phase of a new sense of normality, (the current realities for much of Asia).
Taking lessons from the anecdotal experience in Asia and direction from industry leaders, a consensus seems to be in place for how brands should be behaving now during the outbreak phase. The advice includes refrain from pausing all advertising and promotion, which could have damaging effects on brand awareness and perception long term. If your brand has the credibility to do so, focus on lighthearted and positive messages. Showing a supportive and human response by engaging with all stakeholders and audiences, from customer segments and employees to suppliers and partners. Whilst, at the same time, ensuring any and all media spend is smart, which may involve a switch to more digital channels. But moving past this initial stage and looking to an uncertain future, what can businesses expect when planning ahead for a new normality?
We are all currently navigating through a vastly changing landscape, an era that will be known as pivotal in society and has already seen a number of transitions take place overnight. So how do brands use this to comprehend a new normal? As the industry looks ahead to begin planning for ‘AC’ (after Corona), it is widely accepted that we will be returning to a changed world. The many different scenarios and possibilities for the future are uncertain, however experts have determined key trends emerging that they believe will influence our new post-COVID-19 world and areas that brands need to consider while planning for the next stage of their response.
New Digital Era
Consumer trends predict that over the coming years advancements in technology coupled with greater 5G accessibility will continue to blur lines between location, travel and time through VR and AR. However the impact of the COVID-19 pandemic may have already accelerated an even more integrated use of technology within our everyday lives. Looking at the new normality in parts of Asia, brands are utilising more online services to bridge the physical gap between brands and consumers. Shanghai Fashion Week was live streamed as the world’s first fully digital fashion show despite relaxed social distancing policies, reaching audiences of 2.5 million viewers within the first 3 hours. SHFW partnered with the B2B marketplace platform Tmall, which allowed brands to stream collections via their own channels, while consumers could immediately purchase items from the show. A significant rise in ecommerce has also been seen across the UK and US amid the pandemic, with 1 in 4 now making more purchases online, which is expected to continue increasing as we move forward. This boost in consumer spending online is likely to drive more ad spend to digital channels and cause an inevitable decline in cash payments, which are also behaviours likely to continue as we shape our new normality.
At Home Empires
Up to 86% of us globally have experienced drastic changes in our day to day lives due to the pandemic, including being confined to our household. As a result, a large portion of our consumption has moved to digital channels with people seeking online content for the purposes of work, education, exercise, socialising, wellness and all kinds of entertainment. Also with live events cancelled and postponed due to the crisis, there has been a huge shift towards artists and performers streaming their material online across multiple channels, with some making a lot of money. Due to these changes, demand on streaming services, video and the movement of IRL online is at an all time high. It is predicted that as part of our new normal, demand for more in-home media to replace previous OOH experiences will remain high, with an abundance of new content consistently and readily available and content creators becoming even more comfortable operating in this way. Again, looking at examples from China, post lockdown the increase in demand for streaming services has remained high across multiple industries, including the at home clubbing experience. Online retailer JD.com has partnered with record labels and international alcohol brands to deliver 3 hour live stream shows, which are teamed up with a drinks delivery service. This combination has been so successful (throughout and post lockdown) that events have been scheduled to run until at least May. Leading the way for many industries who have typically relied on offline experiences to enter the online arena in the new ‘AC’ era and reach audiences in new ways.
The Greater Good
Between the likes of L’Oreal and RB urging customers to ‘Shop Responsibly’, the countless organisations such as Dyson, LVMH and F1 Racing Teams who have adapted their production lines to deliver vital and high demand products to fight COVID-19 and donations to health services, many brands are addressing and acting upon the global challenge facing us all. As most customers intend to play their part during this crisis, they’re expecting brands to do the same. Studies have found nearly half of consumers across multiple markets believe businesses and governments should tackle the outbreak together, along with 1 in 3 people reporting they have already moved away from brands who they believe have not acted appropriately during the pandemic. This short term change in behaviour is predicted to lead to a much longer term change in attitudes, with brands expected to offer more than just their typical products and services and focus more on values and building consumer trust. In China, the new normal has seen this shift in behaviour continue and the introduction of more partnerships between organisations. E-commerce giants such as Alibaba have announced resources and initiatives to help boost marketing activity for other brands and merchants, along with opening up omnichannel services to help more physical retailers move online. All with the intentions of supporting business ecosystems, increasing demand and helping to kick start spending (and in turn) the economy. It is expected that Europe and the Americas will follow, with companies likely to place more emphasis on cooperation with business ecosystems and partners, in effort to provide support to each other in difficult times.
Many predict the COVID-19 pandemic will likely be the ‘single-most important catalyst in modern history for changing consumer behaviour and attitudes’. The outcome is expected to have a long lasting impact on consumers, changing attitudes and creating new concerns. For 80% of the global workforce, their workplace has been either fully or partly closed as a result of the crisis. Coupled with the predicted global recession, there is likely to be a continued period of financial hardship and uncertainty ahead, which will inevitably have huge consequences on purchasing decisions. Travel, luxury and technology are just some of the sectors that have seen recent sales plummet, which are expected to see slow recoveries even during our new normality phase. Once restrictions on movement are lifted, the hospitality sector is also expected to see a sluggish rise in visitors, amid both financial and product/food safety concerns. Falling back into old habits and a previous way of life is unlikely. All of which has been seen in markets recovering from Coronavirus. But on a much more positive note, a surge in interest within the health and wellness industries is expected to continue into our new reality and our lockdown lives have contributed to 2020 looking to see the largest ever annual fall in CO2 emissions globally.
Although we cannot completely predict changes that will take place as we move through stages of the pandemic, which will inevitably vary between nations and cultures, what we can take as learnings from countries who are ahead of us in the recovery period is the importance of learning more about our customers. Understanding and monitoring how consumers attitudes, beliefs, and priorities are changing during this time will be even more vital than ever.
As the landscape continues to shift until more stable conditions carve out a new normal, brands will need to plan ahead as best they can. Reflecting on current positioning and values to understand if they will still be relevant in changing markets and for new consumer preferences should be a key part of this approach. It is not an exaggeration to say this time will be critical for brands. Actions that are carried out now will not only be crucial for short term survival and navigating through the outbreak phase, but will greatly impact upon future growth and a return to stability within our new future realities. Whatever those future realities might be.
All factual information correct at time of writing.
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Cover image: Underground Entrance at the totally empty Piccadilly Circus by ZGPhotography