During these uncertain times, leaders are playing a critical role. Setting priorities and making decisions quickly with incomplete and rapidly evolving information. Sales and Marketing leaders, therefore, need to act decisively and take a collaborative approach to stabilize the business. It is essential to minimize the downturn and get the highest return from spend, while proactively responding to customer demand.
Equally important, as efficient business management today, is to start looking ahead, plan for the recovery, envision the future, and devise a plan to get there.
Marketing as a connection between the company and its customers will play a major role in economic recovery. It is time for marketers to step-up, collect key customer insights, understand new consumer behaviors, leverage the learnings to identify new opportunities, and start shaping the new normal.
What have we learned from consumer sentiment and behavior?
Needs have changed. Recent satisfaction metrics show a shift from what customers want to what they need.
Consumption decisions are made differently. We used to search for products online, found the best retailer, and often made a purchase in brick-and-mortar shops. Now E-commerce is blurring the line between marketing and sales. Operating models are being transformed with higher attention to supply and delivery, both connected with secure IT, and all managing sometimes enormous spikes in demand.
Media gained higher attention. According to the Global Web Index report Boomers and Gen X are watching more TV (+45%) and have increased their online video viewing. Millennials and Gen Z are also more engaged with the media right now and are leaning hard into gaming (+30%).
The contact-free economy is “in”. Customers have altered their buying habits. E-commerce was persistently gaining the penetration even before the crisis. Corona virus has only accelerated the transition to online. This trend will likely continue when the worst is behind us and we enter the recovery period.
The distance is back. For several weeks we were prisoners of lock-downs, following strict rules of limited physical contact and overusing hygienic disinfectants. Yet, the real heroes were the professions on the front lines - people working in retail, banks, healthcare, logistics, etc., working hard to maintain our normal. Thank you all.
Higher demand for local products and services. Country lock-downs and cross-border restrictions have weakened the supply between countries. The need for resilience across supply chains is driving sourcing closer to end markets, and a preference for local over global products and services.
The crisis has accelerated digital transformation. Many businesses have realized they are not as digital as they thought. It is well understood how important digitalization is for the prompt response and cooperation with customers. And there is more to come. Future customer demand will show and dictate the next steps in digital evolution.
Efficiently managing the entirely new situation
Marketing and sales teams are juggling several scenarios, putting the fires down and already considering how to steer their company's success toward the new normal. There are many questions on their mind. How to address the customers? How to best optimize investments and stabilize the business situation, mitigate downturn, and stimulate sales? How to cooperate with other departments while working remotely, and still be efficient and add value to customer response? How to stay relevant? What is needed to stay relevant also in the future?
All these questions and more while taking care of the family, kids, being socially responsible, …
We are nevertheless witnessing a major cultural disruption that is changing how we will function in our private and professional lives.
Current consumption intelligence is not yet indicating the immediate signs of recession behavior, though much depends on how long the current uncertainty will last. Everyone understands that cutting the spend is a reality right now. It is fully reasonable to be worried, but now is not the time for marketing to go dark. The key is to execute budget optimizations smartly, so companies don’t threaten their long-term potential for growth. The following imperatives can add value:
Savings without sacrificing customer experience. Good customer experience creates substantial long-lasting value for the business. The sooner that companies can fulfill new customer needs and accelerate time to market, the better the return.
Building agility across functions, to handle changing customer circumstances, is necessary. The introduction of a test-and-scale approach leads to the creation of new experiences with a quick release to the market. Prioritize innovations that fit with remote, digital, or home delivery trends that are likely to accelerate and continue to differentiate in our new reality.
Technology and digitalization shape engagement with customers. There is a good recent healthcare example when family doctors have simply used available online conference solutions to speak with their patients in their ambition to help in the first response. It was a new approach for this very traditional segment. Companies that are not there yet, are starting to realize how technology can help add better value to their customers and the power they can gain by its adoption.
Uncertainty dictates flexible business models and adaptation. Retail is strongly influenced by buying dynamics nowadays. Customers are accustomed to staying at home and shopping online.
After the situation calms down, retailers will need to rethink how to attract customers back to traditional brick-and-mortar stores; how to incentivize them? Retailers must, therefore, gain a deep and up-to-date understanding of customer preferences to respond correctly. Think about potential omnichannel integration and consider how to add new value, shape a seamless and pleasant experience while managing these new expectations.
Planning for the recovery
Marketers need to be ready to capture mindshare and demand from customer insights and professional knowledge. Experience dictates that forward-thinking leaders will release the long-term spend after short-term budget cuts. In doing so, they will rethink how to best use the tools and capabilities while connecting with their customers.
Much was learned from the existing situation. Businesses that have not embraced digital yet, are bound to give marketing the green light to invest in digital tools and capabilities, to upgrade the analytics engines. Investment in data and analytics can significantly improve the ability to better personalize offers to customers, prioritize sales pipeline, and improve sales activities.
Capture early demand. Marketing needs to be ready for demand when it picks up. Develop clear strategies based on customers' expectations and information about what they value. The point is to develop modular scenarios for multiple versions of the future. Define actions and tactics robust enough to enable adaptation and proper scaling.
Sometimes there will be a need to unbundle your current offer, make a shift of your pricing model to recurring revenue or subscription model, or simply to lower up-front fees to attract new customers. The added value should be considered as a key differentiator. Don't forget to closely monitor customer reactions with the offering, so you can adapt.
Win in the next normal
No one can predict the next normal. To succeed marketing will need to think about new capabilities to be effective. New ways of working, new processes to be efficient in their effort. Remain flexible and agile in decision making to be able to adapt. Forward-looking and open to new trends. Bold in innovation based on insights.
Rethink marketing ecosystems. Partnerships and agency cooperation are beneficial for knowledge sharing and efficient management of customer journeys. The improved and resilient ecosystem will need to be flexible enough to identify new customer behaviors and robust enough to enable adaptations on the go with no disturbance to the customer.
Virtualization is becoming a reality. Customers are becoming more comfortable with virtual platforms and open to new options like "visit" and "trial". We have witnessed beautiful examples of virtual museum tours during lock-downs. The virtual experience is also raising attention in other economy segments like the smart mirror in the apparel industry and virtual hair-styling. Soon we can expect new experiences - virtual real estate visits, virtual schools, virtual shopping, etc. Further development supported by AI and smart homes is expected to simplify these experiences, making them seamless and convenient to use for customers, all with a strong impact on business models of the future.
It sounds like a Black Mirror episode, but we can adapt and shape the new reality supported by:
Start-up mindset. A test-learn-adapt operational approach that allows greater flexibility in current uncertainty and thus empowers the business to evolve through innovation.
Investment in new skills and capabilities. Companies should quickly find new talent and up-skill front-line teams working in a remote operational capacity. This way similar situations will be handled with higher efficiency. The future agency, partnership relations will be managed with greater confidence and effectiveness in mind.
Digital, technology, and analytics adoption. An accelerated shift to digital demands a tech-based response. Efficient analytics will help understand customers better, improve decision making, enable a relevant response, and identify new opportunities. A tech stack will empower teams to accelerate execution and scale their impact, drive business innovation, and automate channel roll-out.
Trust is paramount. The power of the brand in uncertain times is a tremendous asset, but the playbook has changed. Marketing leaders will need to rethink the value propositions and build purpose-driven customer journeys, guiding their decisions wherever they might be.
There are many unknowns. We are living in a time when many future practices will emerge. Marketing plays an important role in shaping this future.