Activation in the age of Covid-19
I must admit the last few weeks have been both scary and fascinating.
As marketers, we spend all of our time trying to work out how to change people’s actions, habits and behaviours. And what’s most interesting (but not surprising) is it takes something seismic to properly shift them. That’s not to say marketing can’t achieve this, but it relies on finding a simple truth, insight or tension to push against to properly move people – and never has there been a bigger social tension than the current lockdown we find ourselves in. I think this current situation shines a light on what it actually takes to move people, to change the way they live their lives, the products they buy and the brands they choose.
Right now, we’re seeing just how difficult (if not impossible) it is as far as any form of brand activation is concerned – it’s pretty much ‘out for the count’. Experiential relies on hitting high footfall locations… strike 1; shopper marketing requires retailer co-operation and shop floor staff to implement it… strike 2; and promotions, whether they’re on or off-pack, will most likely get missed or lost in the melee as shoppers choose to spend as little time browsing as possible… strike 3 – and out!
Most of the brand activation tools we were able to use just a few months ago now simply aren’t possible to deploy.
Having said that, brand activation is happening all around us with shoppers being forced to try and to experience brands they wouldn’t normally. Amongst our current clients, we are already starting to see the impact of crazy sales spikes and dips, impacting category and stock management. Others are considering what ‘good’ they can do in response to the crisis, and some are already in full planning mode to ensure that future marketing plans are fit for purpose in a rapidly growing online shopping landscape.
So what does all of this mean for brand activation in this new, rapidly changing world?
Here are five provocations to watch over the coming weeks and months…
Will the early winners be the long-term losers?
Low availability is causing shoppers to purchase and try brands they ordinarily wouldn't do (straight brand shift, trade up, trade down, private label) and that forced trial may lead to changes of perception – product quality, taste experience, efficacy and value for money. How will brands maximise and retain those switched shoppers and regain lost shoppers in the months and weeks ahead when supply and demand begin to level out?
Add to that the fact that people stockpiled products they didn't necessarily need – toilet rolls, cleaning products, tinned foods and, of course, the infamous dried pasta. Whilst the initial bulk buy will help short-term sales, are those shoppers now so inundated with supplies that they won't re-enter the category for weeks, perhaps months?
How will the increase in online shopping behaviour change our marketing plans?
Online grocery shopping moved from niche (admittedly growing) to mainstream. Retailers weren't able to cope with demand. Ocado stopped registering new shoppers and delivery slots got booked up weeks in advance. Will the shift to online grocery shopping become the new normal for many shoppers? If so, how will on-pack promotions or shopper marketing and POS adapt? E-commerce was the 'after thought' for too many campaigns historically. Now, more than ever, it needs to be at the forefront and we may need to completely rethink how things like on-pack promotions and retailer exclusives actually work in this new landscape.
Will switching retailers and shopping habits be set to stay?
Shopper behaviour has shifted beyond deciding which brand to buy at the fixture. People have been forced to change retailers all together as panic buying set in, shopping online accelerated and selecting retailers was based on stock availability. The old guide that shoppers choose their retailer based on location and opening times has changed. We've seen polygamous shopping on the increase – has this had rocket fuel poured on it?
And consider this; we’re all now cycling into a ‘one big shop a week’ mentality. It’s actually back in fashion according to Dave Lewis in his most recent interview with the BBC – so the challenge for brands to help retailers retain and even switch shoppers is going to be heightened. Competition will intensify as the cost of losing a customer increases with shopping frequency down, but average basket spend rapidly increasing.
In-store speed shopping is the new norm. How do we disrupt shoppers in this new landscape?
Shopper behaviour in the store has changed too. Smartscan and mobile phone scanning adoption, a desire to get in and out of the store as quickly as possible – reducing browsing and impulse purchases. People want to spend as little time as possible in close proximity to one another. Add to that the fact they’ve had to queue for 30 minutes or more just to get into the shop, they’ll be ready to get what they need and then get the heck out of there. So disrupting their behaviour with NPD or on-pack promotions will require some clever planning and brilliant creative solutions.
Is this the biggest category management exercise in history?
Retailers will be trawling their EPOS data to find which brands are truly in demand and which, despite such unprecedented demand, remain on shelf. You’ll have all noticed that whilst some shelves are empty, other shelves are still full, meaning there’s now a much more visible way for retailers to consider how to approach the next category rationalisation project and which brands might be in line for delist.
All of this rapid behaviour change in shopping habits means the traditional KPIs for brand and category managers alike are going to be completely shot to pieces. 12-week rolling penetration, purchase frequency, basket spend – all out of kilter with large parts of the retail sector on lockdown. Using the age-old KPIs to demystify the new normal in FMCG is going to require more sophisticated thinking and planning. As if the sea of evaluation metrics weren’t muddied enough with price activity, trading deals and competitor marketing activity, things are only going to get harder from here on in.
Who wins and who loses in this ever-changing landscape will come down to who plans far enough ahead to enable them to flex their plans accordingly, and who correctly predicts which new trends will survive and which will simply return to normal. It’s fair to say that the next weeks and months, as the lockdown rules change again, will be equally as scary and fascinating for brands and retailers alike.
Phil Butterworth is Managing Partner at McCann Interaction