COVID-19 has already taught us about delayed consequences—a lesson brands will learn a second time as markets bounce back more robustly for some than for others.
Ryan Sproull | May 22, 2020
In health and well-being, there have been multiple lessons from the pandemic and the resulting lockdowns. Hygiene has become front and centre for the whole world, along with increased interest in preventative health and mental health under isolation.
In the world of marketing, things feel pretty urgent. In the world of sales, a great many things have changed very quickly in the last few months. Some key factors include:
Consumer demand curves have radically shifted in some categories. Vitamins, minerals and supplements have seen increased demand, while demand for some other categories has collapsed.
Consumer demand is down across the board as households tighten belts in the face of either reduced income or uncertain future employment.
Consumer buying channels have been radically altered by lockdowns. Pharmacies and supermarkets have enjoyed being the only games in town, while other channels have become newly emphasised or adopted (delivery and e-commerce). And some channels have been blocked entirely. And these are huge changes. Some will last only as long as the lockdown levels of a given market, while others will remain until a viable COVID-19 vaccine is developed and distributed.
Where has all of this change left brand marketing? Let’s start by looking at the range of ways that companies have responded.
Some health brands have stopped brand marketing because sales are soaring, so why bother?
Some companies have stopped brand marketing because sales are either down or nearly stopped completely, so why bother?
Some companies have asked themselves, what does our brand mean in the world of COVID-19? And their agencies have eagerly supplied a 60-second video of heart-warming content about…probably hugging?
And some companies have carried on as normal or even increased their spend broadcasting existing brand-building assets.
Before evaluating the relative merits of these reactions, let’s consider the role that brands play in driving business results. Brands have two important jobs:
Association with the category. Make it more likely that the brand will come to mind when a customer’s need for the category arises (compared to competing brands).
Brand salience. Make the brand more familiar to the customer at consideration and selection stages of their purchase journey (compared to competing brands).
Important to note is that both of these impacts on business are long-term. Those associations and that salience builds up in the minds of a market through repeated consistent exposure, over and over, for years. In fact, the impacts of brand building on sales are typically felt around six months after the activity begins.
Thinking back to the delayed impacts of lockdowns on COVID-19 cases, marketers face a similar situation with their brand marketing. Just as today’s COVID-19 cases are caused by infections two weeks ago, today’s shifts in relative brand equity are caused by brand marketing decisions six months ago. And today’s brand marketing decisions will be felt in six months’ time.
What does that mean for the various decisions of marketers listed above? Well, firstly, those who have stopped investing in their brands because of sales being up or stopped today may not understand that brand building was never for today’s sales in the first place. Six months later, they’ll find they have to work harder for sales, and ROI on sales spend will drop—no matter how well or poorly sales are going today.
For companies who have produced feel-good pandemic-specific creative work, results will vary. If their feel-good comms reinforced brand associations to the category and built on previous brand-building work, then at best they’ve produced a good asset with a short shelf life. But most of this work seems to be more about warming hearts than building brands. Either way, there is an opportunity cost in spending resources on brand assets that only make sense for a few months.
And finally, there are those companies who have carried on as usual or even increased their brand marketing spend. As they enjoy the relative advantage of competitors going silent or astray from effective brand building, combined with increased efficiency of channels like TVC at a reduced cost, six months later they’ll be reaping the rewards—sales budget will work harder and they’ll enjoy a disproportionate share of the market.
Act now with tomorrow in mind and be patient. This is the lesson that COVID-19 has already taught us about delayed consequences—a lesson brands will learn a second time as markets bounce back more robustly for some than for others. And a lesson that will continue to be valuable for those who learned it.
Tips for being on the right side of those long-term consequences:
Measure your brand’s success in relative market share, not absolute sales volume. The impacts on your category of external factors like recessions and pandemics are outside of your control, but your position relative to competitors is not.
Evaluate today’s brand decisions by their projected impact six months from now. Even if you can’t predict with total accuracy, this will prevent you from making knee-jerk decisions in immediate circumstances.
If your sales are soaring regardless of your sales spend, redirect some budget to brand maintenance. Keep in mind that the ROI in your sales spend is the difference between what your sales would be without retail messaging and what they are with retail messaging. If they’re going to be high either way, your ROI is actually lowered and that budget might be better spent investing in brand.
If your sales are artificially depressed regardless of your sales spend, redirect some budget to brand maintenance. It’s the same logic as above—whether the dial is low or high, if your dollars aren’t shifting it for now, spend them elsewhere.
Sense-check your messaging for sensitivity, but don’t overthink it and freeze up. It’s true that some communications could now be offensive or hurtful in a way they weren’t before COVID-19. If you’re concerned about potential blowback, get a PR consultant (not a creative director) to review your comms for watch-outs.
Fill gaps left by short-sighted competitors. Are your competitors going quiet or straying from their brand to be ‘relevant’ to pandemics and lockdowns? Seize the opportunity to remind your audiences of who you are and how you offer value in the category,
The 6AM Agency is Australia’s leading health & wellbeing communications agency offering a fully integrated service including strategy, creative, content, digital, social, PR and reputation management.