While this year’s pandemic presents many challenges to marketers, it also presents many more opportunities, particularly as consumer activity rapidly moves online. In this article, we explore how marketers who have created a data-driven link between marketing activity and the commercial impact of that activity on brand they support through analytics, are the ones best placed to grow from change.
Increased digital consumer activity means a wealth of new data on consumer behaviour is being uncovered every day, not to mention behavioural insights. This has the potential for marketers to dig deeper and discover the kind of valuable insight never before gathered in the marketing landscape.
Many marketers are feeling the heat to contract media spend, make budgets stretch further, while still trying to make segmentation and messaging discoveries more possible. And, while this pressure to innovate has been forced upon marketers for survival, it is innovation nonetheless – the lever which often results in the biggest economic advantage to those brave enough to embrace it.
What COVID-19 Reveals to Marketers About Audience Behaviour
In the throes of lockdown, more consumers have been browsing and shopping online, consuming more news and video through online channels, streaming content, holding virtual meetings and social gatherings, and home-schooling their children. According to Engine, consumers are spending 30% more money online since COVID-19.
As 65% of marketers pull back their spend to the tune of about 15% according to latest figures from Gartner, it presents an interesting opportunity to learn more about audiences and delve into new segments. Those marketers working from a commercial lens can gain new ground and find new audiences using new and legacy data. Data now abounds, and it is worth taking a deep dive into the flood to see what new nuggets of analysis can be gleaned from this consumer behaviour.
The increased activity online also means now is a great time for marketers to bring new customers into the brand ecosystem in innovative ways – and learn more about them. Try out some new segments, perhaps adjust messaging and do some testing. Essentially, get creative. After all, marketers don’t know what they don’t know, so it is only through experimenting with data where new and valuable insights can be discovered.
Now is the time to deepen your connection with customers and demonstrate in ways that might be impossible in other times how your brand is genuinely there to serve them and add value to their lives. While consumers are spending more, they are also more pessimistic about the future, with Engine reporting 90% of US adults expecting a recession next year. Those brands that demonstrate value and empathy will grow their brands into the future.
Better Bang for a Media Buck
Fewer advertisers means lower media rates for those left in the market. The IAB reports 70% of media buyers have already paused or downgraded their spend, and media are feeling the pinch. As a consequence, current budgets can stretch further and marketers can capture a greater share of online audiences and increase share of voice and brand equity.
Many marketers now understand those brands who advertise during a recession increased both sales and share of market during the recession and beyond it. A study by Biel and King in 2003 found companies increasing ad spend by up to 20% saw an average gain in market share of 0.5%, and those who increased beyond 20% showed market share gains of 0.9%. It’s clear, marketers who press forward now will see sales will flow strongly in more certain times.
Essentially, fill the void left by competitors. Those brands who have contracted spending have left a space for those who are brave enough to market through this challenging time. It is worth getting in there and competing for their hearts and minds when others are absent.
Innovation as the Backbone for Success
Finally, forced innovation is innovation nonetheless, and this leads to long term economic advantage. In some studies, innovation can lead to an 11% increase in revenue YOY, when done well. The fact is, all businesses must evolve, sooner or later.
Now is the time to become aware of brand and consider opportunities to cross-sell. For example, gin companies are now making hand sanitiser, Tesla and Dyson are making ventilators, restaurants are pivoting to home delivery, and fashion chains are introducing a video call concierge service. It’s time for marketers to again ask how they can better serve customers and fill a need currently being created with a new offering.
A thorough price point analysis is also recommended at this time, not only to stay in business, but to benchmark against competitors’ offerings and positioning. It’s worth lowering prices in the short term to garner customer loyalty and market share. After all, increasing customer retention by just 5% boosts profits by 25% to 95%.
These are all examples of businesses innovating and using data for the short or possibly long term driven by the need to survive. However, far from being negative, this pivot can lead to gains for years to come.