The COVID-19 epidemic has been a human and economic crisis affecting thousands of people and businesses across the globe. The most affected countries represent almost 40% of the global economy and the global financial markets are reacting strongly to the epidemic. While the situation in China seems to have stabilized, there is evidence that the U.S. is currently experiencing community transmission that is growing.
Within this environment, we are witnessing a sharp shift in consumer demand along with a transformation of shopper habits. Consumers are turning to online grocery shopping and we’re seeing a surge in mobile ordering with Instacart, Walmart Grocery and Shipt Mobile apps, including an increase of online orders with perishable, edible groceries. With the Stay-at-Home Economy on the rise, more people are also seeking out contactless delivery options, shelf stable snacks that can sustain long periods in the home and at-home entertainment options.
With these shifts, marketers should be thinking about how they can pivot their marketing strategies in the short and midterm and adapt their retail environment to reflect consumer behavior in this new normal. The following are seven actions that can help your business:
- Short & mid-term stabilization of inventory: We recommend two actions that can be taken to mitigate the immediate impact of the crisis on supply chains. 1) Ensure your information source is reliable. Impact reports in times of crisis tend to be inaccurate, update your intelligence daily and rely on people in the field as a source of reliable information. 2) Running outage scenarios and planning for unseen impact on the business in order to assist in adapting to the evolution in retail and the rise of omni-channel. For example, you can reduce packaging needs for inventory sold on digital commerce for shipment speed and profitability.
- Beware of price gouging: As demand on some items goes up and supply drops, we are seeing many third-party sellers taking advantage of the crisis by gouging prices. Be sure to keep a very close eye on near-term pricing changes to avoid brand deprecation.
- Reassess your products’ primary benefits and consider playing in new consumption occasions: Keep track of consumer search behavior and social sentiment around your product and the category. Consider highlighting key benefits that help address a new consumer need, or play in a new usage occasion that drives your products’ consideration.
- Ensure consumer stabilization: Invest in your core customer segments that demonstrate a long term growth potential and/or high customer lifetime value. Be sure to anticipate their evolved behavior and need and address them using hyper-personalized messages. If they are subscribe-and-save members for example, messaging them within an earlier timeframe to offer a re-stock would be a further loyalty driving message.
- Examine digital commerce vs. national brick-and-mortar as part of your omni-channel strategy: People have dramatically shifted toward online shopping for all types of goods, including food and produce delivery. Ensure that the quality of goods sold online and your product description is accurate. Also consider your customers’ changing preferences may be unlikely to go back to pre-outbreak norms.
- Support epidemic efforts by demonstrating your brand’s purpose: Businesses are only as strong as the communities of which they are a part. Companies need to figure out how to support response efforts—for example, by providing money, equipment, or expertise. For example, a few companies have shifted production to create medical masks and clothing.
- Look forward and start planning for post crisis behaviors: All the shift in behaviors are here to stay: how we work, exercise, socialize, shop, manage our health, educate our kids, take care of family members. We need to start mitigating losses in the short to mid-term and continue to learn and optimize for the long-term