Pandemics accelerate change for brands
by Louise Burgers. Pandemics act like a “pressure cooker”, amplifying and accelerating change for brand strategy, as consumer behaviour radically alters to focus on what they most treasure: safety and security.Wednesday, 20 May 2020
by Louise Burgers. Pandemics act like a “pressure cooker”, amplifying and accelerating change for brand strategy, as consumer behaviour radically alters to focus on what they most treasure: safety and security. Brands need to rethink how they will show up and be effective to capture consumer attention. For example, brands cannot just be present online; ecommerce is not just another channel but requires fundamental new brand strategies.
IAB SA is Zooming free weekly Wednesday insights for the broader media, marketing and advertising industry, based on consumer research from Kantar and insights from various brands. The focus is on how the pandemic has impacted advertising spend, marketing strategies and business operations across our industry. This morning, Wednesday, 20 May 2020, Lynne Gordon, managing partner of the Kantar insights division in South Africa, highlighted five key shifts to help marketers navigate recovery in this COVID-19 world.
The last two months have been the toughest for business globally; as never before in history, have brands faced such disruption all at once and at the same time, says Kantar’s Gordon. “We are entering a new chapter and as marketers, we need to know what will happen next. Life as we know it has changed. We can’t minimise the effect. All our attitudes to life are being challenged.”
Many brands have been paralysed, uncertain of what action to take; others adopted a wait-and-see attitude; others were able to grow as consumer behaviour shifted radically into new categories of health and hygiene. Understanding these shifts and preparing for growth in these uncertain times is where brands and business are looking for strategies now. Most of us have accepted that lockdown will be with us for the next six months as South Africa and Africa reach peak infection over our Winter months in some parts; as well as the fact that we could be facing waves of infection for the next couple of years as this virus ravages our planet and every economy. This means consumer behaviour will not return to any kind of ‘normal’, whatever that means in the current context, for the next 12-24 months.
South Africans are among most stressed in the world
It is not surprising that South Africans are deeply concerned about their financial security and in world worry rankings, feature near the top: 80% are hugely concerned; 69% report that the coronavirus has already impacted their household income. Not surprising when we have already had a tanking economy for several years now, which is being annihilated further by current events. “Concern in South Africa is amongst the highest in the world, rooted primarily in fears about financial security – fueled by Government’s stringent measures and a media exploding with the debate around the economic impact of lockdown. We are in a highly stressed situation overall and that is impacting hugely on consumers and their attitudes to life,” Gordon explains.
What hasn’t helped matters is that many brands have acted like “deer caught in headlights” in the face of the pandemic, when they should have been reassuring customers and working with them to find solutions to what everyone is going through. Gordon said difficult choices need to be made by brands and advertisers: “Should I advertise? How much money can I afford to spend in a very volatile economic situation? Will these changes persist? How should my brand adapt? This is a very difficult and stressful time for brands too.” The reality is that it is now time for decisive action, as we move out of the ‘shock’ phase and into the ‘recovery’ phase of this pandemic; and action and agility are essential, reports Kantar.
Is your brand ready for the emerging new world?
Gordon explains that a successful brand response to COVID-19 considers the holistic impact of the virus – it creates action plans not just for today; but a plan for recovery and recurrence; and the future. Brands need to know what is happening with their consumers; what is happening in their industry category as a whole; and what is happening with our organisations. Everyone has to work quite differently in order to be effective. This is the model Kantar is working on for brands to advise where to start:
- Immediate action – what do you need to do today?
- Plans for recovery and recurrence – recognise that there will be waves of the pandemic in future years to come and how that will affect consumers.
- Preparedness for the future – it is important to think about the future; as well as the opportunities in the future horizon in how brands respond now.
These are the five practical and essential opportunities that Gordon and Kantar focused on today to help brands move to the next phase of action and recovery:
- Omnichannel accelerated
- New signals of safety
- Value equation reimagined
- An era of shared humanity
- Purpose in the pandemic
ONE: The acceleration of omnichannel
Pandemics don’t create behaviours, but they do amplify and accelerate behaviours that were present before. “The pandemic acts like a pressure cooker,” says Gordon, and the current rapid acceleration of consumer behaviour, like onboarding digital grocery shopping, remote working and home schooling, will stick. She said 85% of consumers who started to buy online during the crisis, say they will continue to do so. Africa would not be digitised overnight, but more people are buying online to reduce shopping trips and working from home, accelerating the adoption of a new omnichannel, digital world. This accelerated trial of digital channels does create new customer expectations; and consumers are also accessing brands in new ways, meaning brands need to change their strategy to effectively interact with consumers in these new spaces.
Gordon says a lot of brands are not getting it right. “Brands are treating ecommerce as an availability game. It is not just about availability and distribution and partnering. Online requires fundamentally new strategies for everything and brands need to think about this as a completely new channel; and how they will show up to be effective. They also need to assess whether their organisations are digitally geared for this new world?”
Knorr was referenced as a brand that was doing it right: on the OneCart online shopping site, Knorr products include recipes for consumers which also provide all the other ingredients they need to add to their cart to make a meal featuring Knorr products. As Gordon explains: “This is not about Knorr just listing, but about operating effectively in an ecommerce environment. It is also about inclusive ecommerce in the unique African context. What can your brands do to reach consumers in more informal areas – what is happening more in informal areas, is that consumers are ordering on WhatsApp and runners deliver the food locally; or there are vegetable boxes being delivered. It is happening at a very local level and delivery is in a very different way to normal ecommerce to reach consumers. But brands do also need to think about inclusive ecommerce.”
TWO: Signals of safety
Right now, for brands, it is all about consumer needs – now and in the future. Referencing Maslow’s Hierarchy of Needs, it is obvious where most of us are sitting: Safety and Security. “At this time, sustenance and safety are threatened. The need for survival is very important for consumers. These basic needs have become treasures to consumers,” Gordon outlined. To restore confidence, brands need to move consumers from fear and fragility; to comfort and safety. Consumers fear for their own safety; they are concerned about surfaces, like packaging, on which the virus can survive; and the spaces in which they might be exposed to infection.
What is very positive, is that source matters more and products from South Africa are being favoured – from a safety aspect and due to strong community bonds being forged, which is turning consumer sentiment to support of the local economy and suppliers with a “we are stronger together” mentality. Gordon says 60% of South Africans say brands must have plans in place to protect the supply of services or products to consumers; and 53% need to pay more attention to the origin of products. “Consumers want to know what is safe – this is an opportunity for brands. AirBnB is fighting back with a ‘clean seal’ campaign. Icons and signage are important. The in-store environment is very important. There is an ‘immunity premium’ benefit for brands that offer hygiene benefits. New categories will emerge and thrive during this time.”
THREE: Value equation reimagined
Brands will need to be innovative and agile to meet consumers at their point of affordability. In a fragile economy, the value equation is more important than ever before and consumers are behaving in more price sensitive ways, going for more affordable products from a price point and value perspective. Kantar points to three types of behaviours that will emerge in this move to more affordable categories and cheaper brands:
- SWITCH: There is a huge increase in the private label category as consumers switch to more affordable brands across product categories.
- SWOP: Consumers are swapping to more affordable pack sizes or going for bulk buys that offer greater value for their money.
- SQUEEZE: Rationalising quantity and frequency of consumption of certain brands.
FOUR: An era of shared humanity
Will the post-corona world be a place you’d rather be? “COVID does shake our world views; but what is heavily debated is whether it will be a watershed movement for humanity. Humans are questioning what really matters. It will have an impact on amplifying values that have been there the whole time. As we experience hardship, these things do change how we think about the world. They emphasise community and connectedness.” That has been one of the biggest shifts Kantar is tracking since lockdown began – this shift away from the “me” phase articulated by consumers as the pandemic started to bite. People moved from attitudes of boldly taking this on (13%); to the present attitude of “being in this together” (a jump to 23%). This is what brands can do, says Gordon:
- Be a connector – a brand that brings people together.
- Be generous – compassionate in the face of adversity and hardship.
- Be resourceful – help consumers find solutions with your brand at the centre.
- Bring joy – remind consumers to be happy.
- Share knowledge – keep consumers informed.
FIVE: Purpose post-pandemic
Faced by a world in crisis, consumers expect brands to impact broader society by taking action to build a better world, says Gordon. Corporate Social Responsibility (CSR) will bring goodwill and build corporate reputation; but alone, it cannot change brand preference. Societal impact goes deeper into innovation. Kantar reports that some brands are offering new solutions that create potential for long-term incremental growth; and meeting new needs and creating new business models, resolving tension in the market. “Purpose sits at the intersection of brand truth, human truth and culture. It is not just about speaking to culture. Purpose is rooted in culture and allows brands to have more meaningful, relevant and authentic discussions and connections with consumers. Being authentic unlocks opportunities for meaningful growth. Brands are facing all the same challenge – perhaps for the first time in marketing history. This creates unusual opportunities to partner to ignite demand.”
In fact, 90% of consumers in South Africa say brands need to be helpful. Kantar’s message to all brands out there is, ready or not, step up. Gear towards action, move to recovery. “We are encouraging brands to step up into that opportunity,” concluded Gordon.
Louise Burgers (previously Marsland) is the Publisher and Editor and Co-Founder of RetailingAfrica.com. She has spent over 20 years writing about the FMCG retailing, marketing, media and advertising industry in South Africa and on the African continent. She has specialised in local and Africa consumer trends and is a passionate Afro-optimist who believes it is Africa’s time to rise again and that the Africa Continental Free Trade Agreement (AfCFTA) will be a global gamechanger in the next decade.
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