Marketing post COVID-19: Have you developed your recovery strategy yet?
Prof Anuj Kapoor, IIM Ahmedabad, opines that even if business has slowed down or halted, companies need to be able to plan a way to market themselves through the COVID-19 pandemic and recovery period. This will bring sustenance as well as the ability to capitalise on new opportunities.
Recessionary times like the one precipitated by the present COVID-19 pandemic are expected to shift management focus towards survival over growth. We do not have a precedent that comes anywhere close to the present crisis. But based on past economic calamities, one thing is clear: Firms that have refocused their spending during recessions have emerged stronger and in a more advantageous position compared to firms that made deep spending cuts. Firms that have outperformed their rivals and emerged victorious after the recession also share a more progressive focus over their rivals.
So conventional wisdom suggests that even if companies need to put their business operations on hold during the lockdown period, they should be able to plan a way to market themselves through the pandemic and recovery period. Some critical strategies that firms can follow for marketing communication amidst and post COVID-19 are as follows:
1. Maintaining a consistent and dominant online presence: Since people are restricted in their homes due to lockdown, a lot of them are expected to be online. A dominant and consistent online presence of the firm would help in building a strong impression of the firm.
2. Bring the image of a warm and caring brand: Firms should convey an image of a more humorous, caring and warm brand in the minds of the consumers, especially
during these tough times.
3. Focus on content: Advertising content can be classified into: Informative and emotional content. Informative content focuses on the core attributes, whereas the emotional content focuses more on the hearty side of marketing. During this time of negativity and uncertainty, firms should focus more on the emotional aspect of the advertising message as there’s already deluge of information (and especially, misinformation) around.
In the era for social distancing norms and limits on demand and supply, firms should optimize their supply-chain by opting for lean and transparent structure, use analytics and accurate forecasting to precisely estimate the availability and demand for inventory, predict customer demand for essential items (during lock down) and other items (post-lockdown).
Further, it’s time to incorporate novel and innovative supply-chain initiatives that may be extended after the lockdown and COVID pandemic ends. For example, Zomato has introduced the concept of contact-less delivery and they plan to make it a permanent feature of their delivery process.
NEW PATHWAYS OF GROWTH
Marketers may have to tackle quite discernible changes in consumer behaviour post the lockdown. Understanding these changes will be key to both sustaining your business and capitalising on new opportunities that emerge.
1. Risk-averse consumers: Consumers are expected to be more risk-averse post lock-down and therefore, I expect a surge in demand for durability and reliability in products and services. In fact, demand for extended warranties on products is expected to increase.
2. Need for structure: Consumers must be feeling a lack of control due to the uncertain situations around them. In such situations, they are expected to look for services that are structured and planned.
3. Demand for private label products: COVID pandemic has created financial crunch and economic hardships. Therefore, a lot of consumers are expected to opt for low cost alternatives of well-known brands i.e. products and services that sell ‘value for money’.
4. Lifestyle products:
A lot of consumers have expressed and explored their other interests (like cooking, painting etc.) during the lockdown. Therefore, demand for life-style and holistic (organic/eco-friendly) products and services is expected to increase.
There is a need to make investments in ensuring customers feel safe with your product and trust your brand. Following are some measures that companies can take to ensure this:
• Provide extended warranties.
• Be easy on refunds i.e. if a consumer feels unsure or is not convinced about the quality of the product, firms can offer a complete refund or initiate a hassle-free replacement process.
• Build communication channels i.e. offer a helpline or dedicated professional service person to handle queries of the persons.
• Consistent pricing: Times are uncertain and consumers are expected to be more price-sensitive. Offering them a consistent price during their complete shopping experience should be the key (with little or no chance of bargaining).
• Recommendations: In these uncertain times, consumers are more likely to rely on recommendations from experts (over fellow consumers) and therefore, recommendations based on experts should become a norm and a consistent part of a firm’s interactions with consumers.
Normally seen as hygiene factors, these measures will help you build invaluable brand equity for the long term, which will more than compensate for the short term investments they entail.
CROSSING THE DIGITAL DIVIDE
There is little debate on the possibility of rising e-commerce traction as the economy emerges from the lockdown. However, it remains relatively unexplored territory for most companies in India that are used to the traditional supply chains. Therefore adapting to the online mode of business requires careful planning. In fact, even those who are already online need to recalibrate their strategy for the recovery period. I will therefore address the strategic priorities for both separately.
1. Strengthening online presence while maintaining offline presence
Brands that are completely offline and have minimal digital presence need to go online. There’s rigorous research behind this. Prior research has documented that a firm’s online actions drive offine sales and offline stores presence drives online sales.
2. Build your presence on reviews website (e.g. Yelp)
As stated before, consumers are expected to be more cautious and risk-averse in the coming few days. Therefore, consumers are more likely to be present online checking for brand’s trust-worthiness and absence of firms on these crowd sourced review aggregators would be detrimental.
1. Product bundling: Consumers have become accustomed to hoarding and purchasing items in bulk. It would be great to use predictive power based on the past purchase data of the customers to see what products can be offered in bundles and clubbed together.
2. Refunds, Handling fees and Shipping Times: Request for refunds, longer shipping times and handling fees are expected to be norms in the next few days. Firms need to keep into account differential pricing strategies as well as personalized marketing communications to deal with this.
This may be a time when business gets excruciatingly slow, but it is not a time to sit still and lie in wait for sunnier days. You have to proactively think of ways to bring those ‘sunnier days’ back when business returns to ‘a new normal’. The ability to do so will separate the wheat from the chaff in the post-COVID period.
Anuj Kapoor is an Assistant Professor (Marketing) at IIM-Ahmedabad. His research interests include computational social science, marketing analytics, digital platforms, machine learning and causal inference. He has worked closely with companies and city governments to suggest more ways to become data driven. He has ongoing collaborations with various tech-startups in various industries.