by Anna Hamill, WARC
In June, WARC delved into some of the new trends which were defining the early stages of the COVID-19 response from brands. As economic recession sets in, here’s how brands are navigating a new stage of the pandemic.
Marketing in the COVID-19 crisis
This article is part of a special WARC Snapshot focused on enabling brand marketers to re-strategize amid the unprecedented disruption caused by the novel coronavirus outbreak.
Six long months after much of the world went into quarantine or lockdown, brands are coming to terms with a hard truth: the ‘new normal’ is – perhaps ironically – going to be prolonged period of uncertainty. The second wave of COVID-19 is now cresting in much of the Western world, a return to lockdown seems imminent, and businesses are gearing up for a long and difficult recession.
But despite the upheaval defining this most difficult year, brands are continuing to transform in real-time and lay the foundations for future growth (whenever that may be). Here are some key focus areas.
1. The role of the CMO rises again
Much ink has been spilled in recent years about the Chief Marketing Officer role diminishing in importance. Several global brands have evolved the role (think Chief Digital Officer, Chief Experience Officer, Chief Market Development Officer…) or even disestablished it entirely. Senior marketers have often lamented the challenge of getting more investment in marketing activity from the C suite. Indeed, it’s often the first department to have its budget clashed in challenging times.
But 2020 is a challenge unlike any before.
As the COVID-19 crisis shows little sign of letting up, marketing has emerged as the nerve center of a brand’s pandemic response. With a need for flexibility and strong internal relationships to navigate changing circumstances, the C-suite is fast realizing the crucial role that marketers play in connecting various parts of any business, and especially in managing the relationship with consumers. From shopper insights and brand positioning, to e-commerce and crisis communications, the marketing team is delivering heightened value during COVID-19. The role of the CMO has been wholly revitalized.
Some of those large brands that had done away with CMOs in recent years – McDonalds, NatWest and Telstra to name a few – have reinstated the role this year. Expect more brands to place an emphasis in marketing leadership in coming months.
2. Purpose really matters
In 2020, the world is navigating four crises simultaneously – a relentless pandemic, a looming economic recession worse than anything since the 1930s, a climate emergency and the biggest racial justice movement since the 1960s. Consumers expect action from not only their government and fellow citizens, but also the brands they buy from. In particular, research from July indicated that a vast majority of consumers expected brands to act in support of Black Lives Matter. Brands seen to be stalling or acting in their own corporate interest will be called out, and suffer the financial and moral consequences.
It’s now long past time for brands to walk the talk and make a positive difference. The CMO Growth Council, a group of more than two dozen CMOs from the world’s leading brands, are making major commitments to boost racial diversity in their advertising, both in front of and behind the camera. Grocery brands, as the center of locally-based retail while many other stores were closed, have taken the opportunity to lean into community service. Brands are aligning behind initiatives to tackle climate change or leaning on social media giants to remove harmful content on their platforms.
Every little bit will help.
3. Condensing marketing processes
While the initial stages of the pandemic saw many brands scrambling to put out new advertising (which mostly drew on syrupy messages about togetherness, backed by a gloomy piano track), senior marketing leaders are now realizing the importance of structuring for a marathon effort, not a sprint, especially in highly unpredictable business conditions. Diego Scotti, CMO at US telco Verizon, noted in an exclusive interview with WARC that companies with a strong ‘North Star’ strategy will be better equipped to adapt to a volatile business climate.
Several months in, companies are equipping themselves for the long-term: building real-time data dashboards, re-formulating brand strategies and slashing internal red tape to move faster. Brands are doubling down on fast consumer insights, looking to determine which new trends are here to stay and which are just a flash in the pan. In-housing creative or media has become a priority for some as they seek more flexibility and control at a lower cost. Elsewhere, daily scrum meetings and building COVID-19 ready client-agency relationships become the norm. As Marie Gulin-Merle, a senior marketer at Google noted, the ability to react in real time will be an important skill for marketers going forward.
4. E-commerce platforms are attracting investment
While overall ad spend will be much lower in 2020 than last year as a result of COVID-19, brands with the budgets to do so are looking toward e-commerce as a major advertising opportunity. E-commerce sites are increasingly serving as advertising platforms, and fulfil a similar purpose as in-store messaging in brick-and-mortar outlets. Brands will spend $59bn on e-commerce ads this year, according to WARC’s latest Global Advertising Trends report. Investment is set to increase 18.3% worldwide, growing 30x faster than the wider online ad market.
Amazon – now one of the world’s leading advertisers in its own right – has seen record growth in the face of the COVID-19 outbreak, according to company reports. Amazon anticipates a permanent shift in consumer behaviors toward online shopping. Total net sales reached $88.9bn in Q2 2020, the highest level ever recorded. This is also a year-on-year increase of 40.2% ($25.5bn), the second-quickest rate of growth ever.
Brands including Procter & Gamble, Mondelez and GSK are boosting investment in the e-commerce space as COVID-19 rolls on. For those brands who have the money to do so, now is the time to leap on those consumer behavior changes. Brands shifting into e-commerce should review the fundamentals of product, packaging and price points.
5. A renewed focus on brand experience
Experience is an increasingly important part of long-term brand building – WARC’s Admap from late 2019 focuses on the topic in-depth – but COVID-19 has upended how many brands are approaching it. Health and safety has emerged as a key differentiator of brand experience in the COVID-19 era. How a brand reacts to these new consumer expectations could make or break it.
From fully sanitized hotel rooms, to bookable shopping times, to at-home make-up experiences, brands are adapting to offer consumers peace of mind. With health considerations now impacting brands that don’t usually market themselves in that space (think bricks-and-mortar retail, beauty or even rental cars), expect health and safety messaging and creative ‘at home’ engagement strategies to become even more prominent in the next six months.
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