COVID-19 Business Trends & Implications

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With staying at home and social distancing the new normal, we sought to identify potential trends, many of which will ultimately shape how we conduct business. With such information, businesses can work to establish a roadmap for how to traverse the rocky terrain of the upcoming months.

The (Re-Emphasized) Importance of Digital

COVID-19’s direct digital implications are immediate. Now, and for the foreseeable future, people are at home. They are spending a considerable amount of time online – working, socializing, reading, watching, gaming, and shopping. For businesses that traditionally relied on physical store locations, the face of business has flipped overnight.

E-channels will see a surge of creative personality. The importance of a seamless, intuitive, online user journey equipped with flawless digital customer service has never been more important. Now is the time to rethink your customer loyalty loop, optimizing and reinforcing where, when, and how customer’s repeat purchases. And it’s not just traditional tech-savvy users that are spending more time online, but older populations as well. The broader implications surrounding older generations time online aren’t yet known, but the immediate business opportunity is clear: make digital content inclusive and easy navigate and double-down on digital customer service.

Lastly, today’s consumer has the luxury to compare cost, usability, and service in just a few clicks. This of course isn’t new information, but with more time on their hands than ever, consumers will be doing their digital due diligence. How you create and merchandise digital experiences, plus how they compare with your competitors will be a large brand differentiator now and, in the months, and years to come.

 

The Time and Creativity Burst

In the immediate short term as we deal with the shock:

Over the past few weeks we’ve seen restaurants pair food delivery with free rolls of toilet paper, yoga studios offering complementary online meditation and flow classes, and bars prepare specialty kits for cocktails-at-home. Businesses are thinking outside the box. They are offering creative and specialized products and services that both represent their brand and offer real, unexpected value to consumers. They are also rethinking the role that marketing and sales teams can play across various channels and distribution networks. For example, a large clothing retailer whose storefronts closed thought to utilize their now-at-home sales associates to digitally check-in with customers and offer personalized shopping experiences. This period of time represents a unique opportunity for businesses to reframe how they operate.

In the long-term as we deal with the after-shock and move towards a new equilibrium:

With a large portion of life and business on hold, there exists the opportunity to tinker with the aircraft when it’s not flying at 30,000 feet. Whilst this is going to be a period of difficult choices and restructure, it could also be a time to reset the go-to-market model and re-stage for the future.  Perhaps this takes the shape of organizing an employee relationship management training so that employees become more connected, firms become more socially responsible, and customers are better served. Or perhaps you always thought customer service could be improved, but you never had the bandwidth to formalize such a process. If a process ever seemed clunky to you, now is the time to reframe and think of a creative solve.

 

Greater Brands + Greater Service

We’ve nodded to the importance of customer service throughout difficult economies before, and now stress it again – caring for your customer and showing support at times like this will pay dividends for your business in the future. Business’s that faulter on delivering quality customer experiences at these times tend to be punished more by consumers because discretionary dollars are harder to come by.

When it comes to advertising, now is the time to shift communications from those that focus on acquisition, price and promotion to those that focus on brand value. One builds a brand not only in the course of selling and servicing a product, but in interacting with prospects and customers in non-sales transaction as well. Consider, for example, your current situation and mindset: you’re likely spending significantly more time with your family, you’re especially cognizant about finances given the uncertain economy, and possibly feeling quite anxious about the future. Brands must be sensitive to this and apply greater caution to their messaging. Seeing an ad that is only shameless selling and promotion is likely not going to win you business. On the flip side, ads that work to build community and ease a customer’s struggle at a time like this are going to work harder for you. Messaging and context are everything during times like this, and brand building activities are the best way to set the stage for the coming months.

 

Enhanced Corporate Social Responsibility

In the heat of the medical response to COVID-19 a handful of companies stepped forward and offered their support to help move the world forward. The examples of such companies are as plentiful as they are heartwarming. LVMH committed to produce and distribute 12 tonnes of hand sanitizer, Amazon granted $5m in cash grants to over 400 small businesses and collaborated with local a catering businesses to distribute 73,000 meals to elderly and medically-vulnerable residents in Seattle, Ford is aiming to produce 50,000 ventilators, and the list goes on.  More mid-to-long term CSR programs may look to address the potentially permanent work-from-home communities, as well as help all areas regain normalcy and restart their local economies. For a company like Loreal, for example, this could mean sponsoring beauty and hair salons in local neighborhoods. The pandemic also brings into sharp focus the weaknesses in our global healthcare systems and perspectives on environmentalism that will offer even more areas to focus CSR initiatives.

While such charitable acts are the human thing to do, there is also a short and long-term benefit to such generosity.  In the short-term, such companies will receive immediate positive word of mouth, ultimately growing their overall brand recognition and stature. In the longer-term this may translate to greater pricing power, customer loyalty and ultimately profitability.

 

Eye to the Future

Our world is changing before our eyes. But while some days it might feel hopeless, one thing we can say for certain is that this will end. How long it takes to get reliable treatments and vaccines in place for the novel virus remains to be seen, but whether it’s weeks or, more likely, several months, there will be an eventual return to normalcy. Of course, there will be effects: some industries may be smaller than they once were, and others may be larger. We also predict some pent-up demand as consumers relish certain opportunities to spend again. After all, didn’t the roaring 1920’s follow immediately after the 1918 influenza? The virus’ wake led to immense cultural liberations that fueled massive economic transformations. How will COVID quash recent issues that have been holding us back as a society? How will it act as a catalyst to vast changes that have been waiting to happen?

Being proactive as new trends unfold in front of us today, will help firms prepare and navigate the transitions through the initial recessionary cycle. By strengthening your first line of contact with customers – the digital one – and stitching together a more inclusive digital journey, getting creative with your customer service, brand building and marketing efforts, and giving back to the world, businesses can strengthen their bond with customers and lay the necessary groundwork for our future.

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