Impact of COVID-19 on Marketing Industry
This research provides insight into how the current pandemic will affect marketing and advertising in the future. Beyond the crisis, brands will pivot from traditional to digital marketing channels; consumers will demand more commitment and authenticity from brands. Also, marketers would have to offer convenience, as well as meaningful and human experiences.
Pivot From Traditional to Digital Marketing
- What will change: According to Artefact, traditional marketing is expected to continue declining long after the COVID-19 pandemic. On the other hand, spending on digital channels will continue to grow. The current public health crisis has impacted numerous countries at an incredible speed, disrupting the lives of consumers as well as the marketing activities of advertisers, seemingly overnight. Events were scrapped, campaigns were canceled, and launches have been postponed.
- Why it will change: While companies have been "able to adapt their digital campaigns in real time, cumbersome traditional campaigns could not be saved." Pre-booked out-of-home (OOH) advertising, print, and television (TV) ads kept rolling out as if nothing had changed; however, this has been a waste of money and time.
- MGM Studios, for instance, decided to push back the release of its latest James Bond movie — ‘No Time to Die’. This move is expected to cost the company about "$30-50 million in wasted media dollars — including a $4.5 million Super Bowl TV spot that was already paid for."
- Traditional marketing experts often talk about how crucial traditional marketing is for brand building; however, the response to the COVID-19 crisis has proven that digital channels can now play that role faster, cheaper, and better.
- How it will change: While traditional marketing efforts suffered during the pandemic, online companies have been able to move with agility and keep in touch with their customers by leveraging live streams, webinars, podcasts, and virtual reality (VR) experiences.
- After the public health crisis, "brands will increasingly switch their budgets to digital marketing." A lot of these brands will improve their digital presence. Also, new digital business models will emerge, tailored for specific target audiences online.
Commitment and Authenticity
- What will change: After the pandemic, brands will need to show more commitment and authenticity in their messaging and actions. According to Claire Beale, the global editor-in-chief of Campaign Magazine, consumers will be asking a lot more from brands. Consumers will "expect brands to offer greater value to society and the planet than ever before."
- Why it will change: The current pandemic has made consumers more conscious of brands' efforts in addressing society's needs. According to research conducted by Hall & Partners, "56% of UK consumers agree that they have [realized] that local community is important".
- In the United States, 72% of consumers are currently "not impressed with how brands have supported communities." These are clear indications that the pressure is mounting for brands to do more in helping communities.
- IAB data reveals that 73% of advertisers have developed new assets or modified their current assets since the pandemic began. Of these advertisers, "53% are increasing messaging that emphasizes the mission of the company."
- How it will change: For a significant period after the public health crisis is over, brands "will need to show authentic and long-term commitment to being brands that care." In their messaging and actions, companies will need to prove that they are on the side of communities.
- The pandemic will ensure that purpose becomes an integral part of brand strategies in the future. However, it will not be enough to simply make promises and try to appear empathetic; brands will have to show authenticity "and go far beyond what is expected of them."
- What will change: The advent of COVID-19 has reemphasized the need to correctly interpret data in order to understand customers. During a crisis, behavioral shifts occur very fast, and brands have had to continuously leverage data in keeping up with these changes. This practice is expected to continue beyond the pandemic.
- Why it will change: According to Brian Wieser, the global president of business intelligence at GroupM, the current crisis has changed consumer behavior; therefore, a lot of the data that brands had gathered regarding their consumers would become redundant after the pandemic.
- Wieser stated: "One could argue that many elements of human [behavior] are going to change permanently. The products we want could be radically different in the future — so data that was used previously to inform advertising and marketing spend is not necessarily going to be useful."
- Also, data is helping — and will continue to help — marketers to develop a detailed understanding of their existing and future customers. It also gives them a substantial competitive advantage.
- How it will change: Marketers are becoming more aware of the need to quickly respond to external situations in order to optimize their spending. After the pandemic, these marketers will continue to leverage data to achieve their short term and long term goals.
- After the crisis, marketers will need to know their customers' "comfort levels with all shopping experiences." For instance, the in-store shopping preferences of consumers have changed. Once the pandemic is over, shoppers might be less willing to try on makeup from a shared sample of products without a vaccine.
- Shoppers might also "want clothes to be disinfected between try-ons, or need to be reassured that touch screens are cleaned frequently." These preferences can only be discovered or validated by actively gathering data.
Increased Collaboration With Marketing Agencies
- What will change: In-house marketing has been a major trend in the last few years. Many brands have been turning to consultancies for help in building teams successfully. However, this is expected to change after the pandemic. In the years to come, there will be increased collaboration with agency partners.
- Why it will change: According to Hannes Weißensteiner, managing partner at Artefact, while brands will still need in-house marketing experts as well as consultancies, a major lesson that has been learned during the pandemic is the fact "that advertisers are more flexible in reacting to economic change when working with agencies."
- It is a lot easier to stop activities that are being run by agency partners than to shut down customized in-house agencies.
- How it will change: Weißensteiner predicts that after the pandemic, in-housing will remain relevant and continue to grow; however, companies will start cooperating more with agencies. He stated: "The hybrid model (experts in-house that coordinate and cooperate with service providers) will rise and evolve."
- What will change: In crafting their value propositions, taglines, and campaign messaging, brands will need to continue marketing flexible solutions in order to keep up with behaviors that were learned during social distancing. To achieve this, service brands, restaurants, and retailers would need to embrace technology in delivering seamless customer experiences.
- Why it will change: During the pandemic, consumers have been adjusting to mandatory stay-at-home guidelines. As a result, they are now "relying on services once thought to be indulgent amenities." The current lock down is making consumers more accustomed to elevated services; therefore, their expectations will also "shift from novel to anticipated, and brands will be expected to maintain this new range of offerings."
- How it will change: Beyond the COVID-19 crisis, several conveniences will be highly demanded. Notable examples include virtual doctor visits, curbside pick-up, same-day grocery delivery, live streaming fitness offerings, and direct-to-consumer movie screenings.
- Consumers would expect every touchpoint of a dining or shopping journey to be frictionless. Technology will be vital in delivering this expected convenience. Among other services, brands would have to leverage technology to provide virtual consulting, contactless payments, and grocery order replication.
- What will change: After the pandemic, agile marketing will become the new normal. Competing brands will continue to "acquire more responsive and real-time marketing stacks where data-driven dynamic creative technology enables rapid and immediate changes to creative and content to be pushed out to all marketing channels."
- Why it will change: During the pandemic, it took weeks for many brands to change their advertising messaging. Their creative and content production teams spent significant time and money to manually re-create campaigns such as display ads and TV commercials.
- The response needed for the coronavirus pandemic "was also unusual in that messaging had to be differential depending on where in the world (or even within a country) the brand was advertising." As a result, adopting a one-size-fits-all messaging was very risky.
- A brand could be talking about empathy in areas where people had moved past the crisis; some were trying to direct people to stores that were already closed or located at places where infections were peaking. These errors, which were caused by a lack of agility, would have to be corrected by leveraging efficient marketing stacks.
- How it will change: In the post-COVID-19 era, marketers "will have to rethink what technologies they really need, which ones can help them save money, and which ones can help them transform their businesses that have been altered by this crisis."
- Therefore, any marketing technology that helps address a brand's business needs after the crisis will be considered “essential”. The rest may end up being discarded.
Demand for Meaningful and Human Experiences
- What will change: When the pandemic ends, consumers will continue to value experiential marketing campaigns. However, the focus will shift to activations that are driven by meaning, a human connection, and authenticity.
- Why it will change: After experiencing the current health and economic crisis, brands will need to help their customers to get back on their feet. Many customers have been financially impacted by the pandemic. These circumstances have created major lasting changes in the minds of consumers and they are beginning to expect the human touch from brands.
- According to Edelman Trust Barometer: 71% of consumers in the United States "say if they perceive that a brand is putting profit over people, they will lose trust in that brand forever." Therefore, it has become very important for brands to add the human touch to their marketing efforts and create experiences that resonate with their customers' emotions.
- How it will change: Currently, and after the pandemic, campaigns that are simply looking for public relations buzz or social media traffic will feel empty and imposed. Instead, experiences that are driven by true human connections and emotions will gain more loyal fans.
- Beyond the crisis, consumers will be searching for companies to rally around. They will seek companies that uplift, support and lead social causes, or simply make them laugh. People will also look forward to opportunities that allow them to reconnect with family and friends, celebrate the heroes on the frontline, or experience a mental health boost.