The Marketing World during a Pandemic
Now that the COVID-19 outbreak has turned into a global pandemic, individuals, businesses, and governments around the world are striving to determine the best ways to protect their citizens and economies. The result is a dramatic change in human behaviour and our prosperity.
This article is intended to help business leaders quickly understand some of the key trends at play in consumer behaviour and the media landscape, and how brands are responding. This reflects the changes we at Dentsu Aegis Network have observed in the markets where we operate.
In affected areas, we see that consumer behaviour has changed in several ways:
- Increased consumption of news.
Companies like Comcast and T-Mobile in the United States have announced they will temporarily suspend Internet data limits to ensure that as many people as possible can stay connected.
2. Media becomes a way to enrich everyday life.
In China, young people use virtual gathering apps to combat boredom. For example, the WanBa (玩吧app) offers various multiplayer games for people to play on mobile devices, such as Draw & Guess and Online Roleplay.
3. The isolation makes life more digital.
In the United States, the gym industry is rethinking its model, moving to live online streaming and short video platforms to reach people at home. Companies like Peloton were revalued on the stock market while other brands have fallen dramatically.
As people turn to isolation, our interactions are now online, changing the way we engage with the physical and virtual world:
There is an increase in search and traffic on e-commerce sites.
This is especially the case for protective equipment, drugs and food. As online demand increases, pressure on supply chains increases, especially for products typically made in China. Retailers have been responding in many ways.
Traffic is declining for the travel, catering, sports, entertainment and offline retail categories.
OpenTable data shows how traffic to restaurants has dropped dramatically in recent days. Traffic is likely to come to a complete halt as more governments demand closings and adopt new containment measures. Brands like Apple have already closed most of their retail stores. Although Apple has reopened its operations in China now that the country has more control of the pandemic.
Brands that have never thought about joining the world of e-commerce or migrated their operations to the virtual world are at a greater risk of disappearing
Both traditional brands and small and medium entrepreneurs are improvising to move their businesses online. Advertisers feel a new urgency to enter the world of e-commerce.
Similarly to the way commerce is changing, uncertainty, confinement, and working-from-home are changing the ways people consume media.
People consume more media throughout the day and not just during primetime.
In the United States, transmission volume could increase by 60% depending on Nielsen, who base their analysis on data from previous containment situations. Open TV consumption in Italy increased by 15% when comparing February 2019 vs February 2020.
There is an increase in the digital consumption of news content.
Many news editors removed their paid subscriptions in all articles related to COVID-19. This was done as a public service and to avoid misinformation about the pandemic. Also, platforms such as Google have launched initiatives to lure users to trusted sources and block any ads that take advantage of the situation.
Traditional media will see a decline in their prices due to an increase in unused inventory.
Media that do not base their purchase on the immediate performance of the audience, for example, print media or digital spaces with premium purchasing models, will grow their audiences, but not their costs. This is an immediate action to capitalize on.
Advertising in public spaces is decreasing and losing relevance, primarily affecting OOH, cinema and live events.
While some production houses have chosen to postpone the release of their films, others have decided to release them, but on digital channels. In China, the movie Lost in Russia moved to ByteDance and other online video platforms, attracting 180 million viewers in the first three days! On the other hand, major sporting events such as the NBA and Copa América have already announced their cancellations, and the 2020 Japan Olympics have been postponed.
VOD (video on demand) and gaming (including streaming) subscriptions are increasing.
This reality leads us to evaluate the possibility of advertising in virtual events, IG concerts and online tournaments, which will have a growing audience in the following weeks.
Increased risk of fake news and content not suitable for brands.
While there is a growing opportunity in the digital ecosystem, brands must take all purchasing regulations more seriously than ever before so not to risk being linked to negative news. In this scenario, having a negative word and blacklist strategy is critical in digital purchasing strategies.
The importance of Empathetic creativity
Finally, the tone and content of our communications must show empathy with the current events. From the perspective of advertisers, agencies and media owners, we have a responsibility to continue communicating and entertaining, now more than before, and being relevant to the new reality of our lives. Although we must isolate ourselves socially, this is a time to create virtual experiences that build closeness and commitment to those brands that stay connected to their consumers.
Here are some key points in preparation for COVID-19’s impact on our industry
