5 ways the Coronavirus is changing business (for the better)
The Coronavirus has changed things. A lot of things.
In fact, many news headlines are claiming it’s changed our lives/ business/ [fill the blank] forever.
We’re not so sure about that, but it’s certainly changed business for the time being. And not all in a bad way.
According to Maxwell Maltz, it takes 21 days to form a habit. On that basis, it’s safe to say consumer buying habits are different to before the pandemic hit. But only time will tell if they've changed forever or for now.
Here are 6 ways the Coronavirus is currently changing business as we know it.
1. Going digital-first
Being a digital-first brand isn’t a new concept, but it’s now a critically important one.
People are no longer able to pop to the shops for their every need. Instead, they’re going online. That automatically puts businesses with strong online offerings ahead of the competition.
Some brands are taking this a step further by creating immersive experiences, entirely online.
Budweiser, Carlsberg and Rémy Martin have partnered with ecommerce giant JD.com to provide online clubbing. The National Theatre is live streaming critically acclaimed performances. We’ve all heard about Joe Wicks’ – A.K.A. The Body Coach – PE workouts.
Now that in-person events are cancelled for the foreseeable, this digital-first approach is key to getting people talking, reaching new audiences, and continuing to grow.
2. Increased demand for direct-to-consumer brands
There’s been an explosion of DTC brands over the past few years. Cutting out the middleman (e.g. department stores or online marketplaces) has empowered businesses to build strong customer relationships, rooted in competitive prices and the ability to adapt.
It’s this power to adapt that has seen DTC businesses thrive in the current situation.
While many businesses are struggling to manage complex supply chains, DTC brands have rapidly modified theirs to continue running smoothly. Bloom & Wild, for example, is now sourcing flowers entirely from the UK, rather than rely on growers on the continent.
DTC brands ranging from beauty to biotech have gained prominence during the current crisis, and will continue to do so as more people discover the benefits of going direct. The brand loyalty these retailers tend to instil in customers means this demand is likely to continue once normality resumes.
This in turn may force retailers with extensive supply chains to review and refine their models in order to compete. But they should be cautious to do so for the right reasons.
As Cheryl Calverley, Chief Marketing Officer of ecommerce retailer Eve Sleep, told The Drum: “The reason we sell directly to consumers online is because it is the most efficient way, and it is never to be gimmicky. Brands that don’t do it properly will get found out.”
3. New ways of working
Many of us are working from home, on reduced pay or furloughed. That’s given us the opportunity to reflect on how we work.
It’s shown that those long days in the office and sweaty commutes weren’t as essential as we thought. 92% of workers believe they’re well equipped to work from home. Four in ten London buyers are already considering a move to the country.
It’s not just employees having a eureka moment. Agile businesses are also discovering the benefits of a workforce that can work anywhere, any time.
As offices begin to open again, businesses and employees alike will reassess how they work. From a recruitment perspective, flexible working will become a crucial factor in hiring and keeping top talent. From a revenue perspective, a flexible working culture means less office space and more money saved.
4. Focus on sustainable growth
With budgets slashed, many marketers have had to rethink their customer acquisition and retention strategies.
There’s more scrutiny than ever on marketing ROI – for many businesses, an expensive TV ad with no trackable impact is no longer an option. Instead, marketers are turning to less traditional but more measurably effective channels, such as referral programmes.
There’s been a flurry of brands discounting goods to shift stock, but this may do more harm than good long-term.
Prior to the pandemic, 44% of businesses focussed primarily on new customer acquisition, despite it being five times more expensive.
The current climate will prompt more marketers to realise the untapped value of their existing customers. Instead of reducing profit margins to acquire one-off customers, marketers should focus on brand-building and customer retention strategies that engage with happy customers for long-term results.
5. Living brand values
For too long, brands have got away with simply saying the right things. Not anymore.
Those helping during this crisis are being noticed, getting far more attention in the press and on social media than any clever marketing stunt could achieve.
The importance of brand values is reiterated by the heartened show of support for local businesses.
Small acts to #supportsmallbusiness, such as ordering food from a family-run restaurant, buying vouchers for a favourite hair salon, or following a Zoom workout from a local instructor have a lasting impact.
In April, spending at local off-licences, greengrocers and convenience stores increased by almost 40%.
This reiterates the importance of brand-building in the current climate. People are increasingly money-conscious and considerate of the brands they shop with. The businesses living values consumers identify with will prosper.
Preparing for the times ahead
Now's the time for businesses to review how they’ve adapted to the current situation – and which of these adaptations they want to build upon into the future.
The Coronavirus may not have changed things forever, but it has forced businesses to rethink their offerings and strategies. Given how competitive the landscape will be when we emerge from this pandemic, effective long-term strategies will be fundamental to brand success.
Most firms believe they could be ready to restart business as normal with just three weeks' notice. But being ready is just half the picture. To make sure consumers feel ready to return to them, businesses must reactivate their customer acquisition and retention strategies now.