The world is living in unprecedented times. States are reopening then closing again as COVID-19 cases increase. Hotels are vacant, malls are empty, and fewer consumers are venturing outside to shop. In Q2, the US recorded the steepest drop in economic output in recorded history.
The pandemic has made it difficult for businesses everywhere to remain afloat, much less grow. New challenges have risen, forcing brands to rethink their approach to advertising and marketing.
Read on to learn more about the effects of COVID-19 on marketing and how brands can rise above them.
The Current State of Affairs: Marketing in a Constantly Shifting Landscape
The world is several months into the pandemic, and its effects have already made themselves felt on businesses of all sizes across all industries.
The International Money Fund forecasts global growth at -4.9%, about 1.9% lower than what was projected in April 2020 by the World Economic Outlook (WEO) forecast. The pandemic’s effects have negatively impacted all sectors worldwide, but some felt the effects more intensely. These include the aviation, retail, and hospitality industries.
It’s an uncertain time for businesses worldwide. Not only has the pandemic forced changes in how they operate. It has also created a need to re-evaluate and refocus their marketing strategies.
Going digital
Due to pandemic restrictions and anxiety over their health, consumers are staying home. They have become reliant on online sources for their needs, obtaining everything from groceries to medical care online. The shift to digital has pushed brands to online marketing, with the primary goals of retaining existing customers and maintaining brand awareness.
With interactions moving to the digital space, businesses make significant changes to how they sustain and grow their brands. Many companies re-evaluate their marketing spend and how they’re utilized, seeking ways to generate continued consumer interest while protecting and even increasing their bottom line. At the same time, they’re beset with challenges unique to or exacerbated by the pandemic situation.
These challenges include increased competition, heightened attention from governmental agencies that regulate promotions, and a marked change in consumer sentiment and spending habits.
Conscious consumption
Consumers have become more selective when it comes to how they spend their money. As they try to adapt to the new normal, they’ve shifted their spending mostly to essential items, and as a result, sales of discretionary products have dropped. They’re also choosing to purchase from businesses that provide solutions to concerns involving health and community.
Brands are adapting their messaging and tone to align with the new needs and expectations of consumers. The challenge lies in creating innovative, mindful marketing strategies that promote the purchase of their products or services while maintaining customer loyalty and trust.
The Effects of COVID-19 on Marketing and Business
In a Bellwethr survey of small business owners in the US conducted in March, 55% of respondents reported that the pandemic harmed their business.
Half of the companies surveyed also reported having to change their marketing strategy, and 67% are increasing their efforts at customer retention.
The survey respondents also reported difficulties with other aspects of their operations. Of the 400 businesses surveyed, more than half had employees who were unable to work. Meanwhile, 42.8% experienced delays in supply chain processes.
However, despite decreased sales and revenue, businesses do not appear to be reducing their marketing spend. On the contrary, they realize the value of marketing in preventing further losses and supporting future gains. A CMO Survey conducted in June by Duke University’s Fuqua School of Business found that marketing spends as a percentage of US businesses’ budgets increased from 11.3% in January to 12.6% in May.
How Brands can Manage the Impact of COVID-19
The following are some marketing best practices for brands to help them mitigate the pandemic’s harmful effects.
Stay connected
With most of the world staying at home either due to shelter-at-home orders or their personal choice, it’s up to businesses to meet consumers where they’re at: online. Data from a Pew Research report shows that half of American adults find the internet essential during the pandemic.
Businesses should provide regular, consistent messaging to their customers on their website and social media accounts. A priority should be delivering useful information about pandemic-driven changes to business operations, such as new hours and updated services like curbside delivery and shipping.
According to research by McKinsey, consumers buy more from companies that demonstrate concern for their employees. Businesses can reassure their customers by telling them what measures they’ve put in place to ensure their safety and well-being and that of their workers.
Consumers are now, more than ever, looking for brands they can trust and whose values align with theirs. Brands must deliver on their values and be empathetic when communicating with customers. Many customers are looking for stability and comfort in these uncertain times, and the right messaging can provide them with just that.
Leverage high-quality content
Quality content is the workhorse of digital marketing—it allows brands to educate, entertain, and engage with consumers. It builds a brand’s online reputation and establishes it as a thought leader in its industry, which helps build brand awareness and trust.
Consistently producing and publishing high-quality content boosts traffic to a brand’s website and social media pages. Doing so helps generate leads and improve conversion rates.
The coronavirus is a very topical subject, and brands can up their visibility by posting content relevant to their business and the pandemic situation. COVID-19-related content is likely to get more shares, likes, and reposts than evergreen topics.
However, when creating pandemic-related content, it is essential to adopt the right tone. Brands must focus on being empathetic and providing real solutions. They must be careful not to be perceived as taking advantage of the situation; otherwise, their reputation may become damaged.
To streamline their content marketing efforts, brands should consider using CoSchedule, Contently, and SEMRush. These can prove useful to businesses who wish to optimize all stages of their content marketing workflow, from creating a strategy to distributing content.
Listen to customers and provide solutions
According to a report by Gladly, consumers are increasingly demanding the ability to communicate with businesses on their preferred channels. 30% of those polled stated that being able to choose channels helped make a great customer experience.
To ensure a positive customer service experience, businesses should let their customers know that they are ready to provide timely support. Companies should respond promptly through all of the communication channels, be it phone, email, or social media.
While bots and FAQs are helpful self-service options, they do not impart the warmth and empathy that consumers are looking for in these challenging times. Now more than ever, it’s vital for brands to show their customers that they care and are happy to provide solutions tailored to their needs.
The same Gladly report found that 77% of consumers would continue patronizing a business that provides excellent customer service. This data suggests that a caring and personalized approach can help boost customer loyalty. This, in turn, has a positive impact on profits. Research by Bain & Company shows that just a 5% increase in customer retention can boost ROI by 25% to 95%.
Tips on marketing during the pandemic
Brands must employ a balancing act when marketing during these uncertain times. Advertising and marketing strategies must take into account the current situation and changed customer attitudes and needs.
At the same time, brands must ensure that their materials comply with the Federal Trade Commission (FTC) and other organizations are cracking down on deceptive or abusive advertising and marketing practices and penalizing businesses that are taking advantage of the pandemic situation.
Here are some ways businesses can address these challenges and market effectively amidst the COVID-19 pandemic.
Cut through the noise with influencer marketing
At the beginning of the pandemic, industry experts’ prevailing view was that COVID-19 would make influencer marketing fall in popularity. Many articles discussed challenges such as reduced marketing budgets and a suddenly-crowded digital marketing environment.
Another concern was the ability of influencers to produce compelling content amidst shelter-in-place orders. Early forecasts echoed this sentiment, predicting that influencer marketing would drop as a result of the pandemic.
Contrary to expectations, influencers were able to adapt quickly. Unhampered by decreased mobility, influencers began producing creative content at home.
A consumer survey commissioned by Matter Communications shows that the year’s challenges have opened up influencer marketing opportunities. About 58% of consumers surveyed reported noticing more influencers, while 51% had positive attitudes to influencer content.
Businesses should consider allocating a portion of their marketing budget to influencer marketing. Meanwhile, they should also take steps to protect themselves from legal problems that could hamper their marketing efforts. These problems can arise from non-compliance with guidelines set by the FTC and other consumer protection organizations.
One way brands can ensure compliance is by creating clear disclosure statements and complying with endorsement guidelines. Incorporating disclosure language into promotional materials helps ensure that consumers know an influencer’s relationship with a brand.
The FTC released a comprehensive guide that describes the disclosure requirements that apply to endorsements made on social media. It includes tips for influencers and brands on creating disclosure messaging that is clear and effective.
Hold giveaways and sweepstakes
Online sweepstakes, giveaways, and similar promotional events are effective marketing tools. However, many businesses are understandably hesitant about launching contests amidst the pandemic, fearing that they may appear insensitive to the current situation. Also, these types of promotions are highly regulated.
However, sweepstakes and giveaways—when done correctly and in compliance with applicable laws—allow businesses to engage with their customers in meaningful ways. They increase brand visibility, boost social media engagement, and generate leads.
Collaborative promotional activities, such as photo contests and karaoke competitions, provide consumers with a much-needed distraction from the pandemic’s grim realities.
Meanwhile, sweepstakes and giveaways with a charitable element make customers feel good about supporting the business behind them, thus boosting brand loyalty.
Utilize gift card marketing
Gift cards have been a popular marketing tool for years, and businesses are finding new value in them during the pandemic.
With lockdown orders in many areas, fewer consumers are venturing outside their homes to visit retailers, restaurants, and other brick-and-mortar businesses. By selling gift cards, companies boost their cash flow at a time when business is slow.
At the same time, gift cards increase brand awareness. By selling gift cards for future use, businesses ensure that customers will remember and visit them when lockdown restrictions have been lifted.
Partner with a charity or support a cause
According to research by Edelman, 64% of consumers expect brands to take a larger role in society, while 67% agree that trust is a factor in their purchase decisions. A cause marketing campaign can help brands achieve their business goals while supporting causes that are important to their audience and contribute to society’s betterment. It allows them to meet a critical need in a time of crisis, and it empowers businesses to demonstrate their commitment to their communities, which builds customer trust.
Investing in cause marketing will benefit brands in the future. When the COVID-19 crisis is over, consumers are more likely to remember and prefer purchasing from businesses who took action to the pandemic over those that didn’t.
Conclusion
It is unlikely for the marketing landscape to “go back to normal” any time soon. As such, businesses should avoid a wait-and-see approach. For them to survive and even thrive in the pandemic, they must be proactive and agile. Companies must anticipate and respond to challenges quickly and recalibrate their marketing operations approach when needed. By doing so, they build and sustain their brand equity and attract and retain customers, thus improving their bottom line.
What strategies is your business implementing to stay on top of changes in the marketing environment?
