The Coronavirus pandemic has forced us to re-evaluate our marketing strategies, among the many changes sparked in the first months of the crisis, and it looks increasingly certain that it could bring a recession in 2020-2021 after going through a ’normalisation’ period – as we’re noticing from the early signs of recovery in China. Unfortunately what we’re facing is unlikely to be a normal recession: in fact, it will be the first health-driven recession of the modern era.
That makes the dynamics of the recovery hard to predict, as consequences of the lockdown become apparent and there is risk of further outbreaks. Despite the situation and while no two downturns are exactly the same, yet many lessons about marketing and promotion from previous recessions might still apply.
This article reflects my presentation at the CMA Learning, and pulls together expert evidence on the best way for brand owners to manage marketing and promotional budgets, showcasing some of the best thinking from across the industry on navigating the post-lockdown period.
As Peter Field states, “The coming months will test everyone – we are in uncharted territory. But this was much the same in 2008 and it was the brands that held their nerve that bounced back strongly when recovery came.”
- Don’t go dark – if you can maintain spend
A general marketing principle dictates that market share (SOM) tends to strongly correlate with share of voice (SOV – the percentage of promotional activities spent by the brand). Specifically where a brand SOV is higher than SOM the brand SOM tends to grow, and the opposite is valid.
In times of recession, just keeping promotional spend flat can put our brand in a dominant position. As an example, if all the companies in our category suddenly cut their promotional spend in half, our marketing investment, that was 10% of the total share of voice, now doubles to 20% as a result.
But it’s increasingly clear that for many brands this advice is academic and quite unrealistic. Maintaining spend is not an option if your sector has been hit hard. Brands hardest hit by the crisis will focus on saving jobs and business continuity.
- Digital content experiences (not advert) are on the rise
Because of the unprecedented nature of this crisis, digital content consumption has grown. Despite decline of media cost, media spend has fallen sharply across all channels as many categories turn off ad spend; as an example, US spending on search advert, often viewed as recession-proof, is falling between 9% and 15% in H1 2020 due to business closures and Amazon’s decision to suspend shipment of all non-essential products.
Offline content is declining too, due to the nature of the crisis; so are events, meetings and large gatherings. Digital content, video content, social media content, interactive content, webinars and digital events, are on the rise – brands should turn to digital content, always looking at where their audience keeps conversations and consumes content.
- Brand building, not just activation
As we have mentioned presenting the SOV principle, brand associations created now are likely to bring the greatest sales benefit during the recovery period. Brands who can still invest should resist the pressure to switch promotional spend from brand to activation. This is even more valid for B2B: because the sales funnel in B2B purchasing is generally longer than in B2C, arguments in favour of supporting long-term growth through brand building are likely to be even stronger.
In addition, for those B2B businesses whose customers and prospects are unable to buy, or who cannot meet existing customer demand, pursuing short-term activation and lead-gen activities make little sense. For these brands is suggested investing in long-term relationship-building.
Finally, some brands will see a lift on their products and services’ demand. Think about video conferencing platforms, digital content producers and delivery brands. A good mix of brand building and short-term activation will make perfect sense for these brands.
Les Binet is not wrong when he says that “Brand promotion is not about profiting in recession, it is about capitalising on recovery”.
- Emotions vs. logic – with distinctiveness
Featuring humanity, humour, warmth and generosity in promotion are advised. Demonstrating humanity and generosity through behaviour is advised too: brands should ask themselves the question, ‘how can we help?’.
We should lead with empathy, humour and emotion. The most successful campaigns out of previous recessions leveraged emotion over logic; emotional creative strategies help to evoke warmth and humanity and have been the most effective in time of recessions. Yet, we should be distinctive. When we communicate like everyone else – devoid of codes, devoid of differentiation, with exactly the same message as those around us – we will disappear completely.