It seems as though, almost overnight, the COVID-19 virus changed the world. In these unprecedented times of change and uncertainty we have seen the world come together to fight the virus by simply doing one thing. Staying at home.
We have seen repeatedly that brands who continue to advertise during a time of economic instability come out the other side far stronger than brands who don’t. The following will look at how brands have responded to the COVID-19 pandemic.
Let’s take a look at the facts
The situation at hand is unique and unprecedented, but there are historic reference points such as Kellogg’s in 1929 and Amazon US in 2009, that we can turn to that will help guide us through to the other side. We have seen consumer behaviour and spend habits change dramatically, according to Statistics NZ retail card spending across the country fell more than $2.6 billion in April. Westpac senior economist Satish Ranchhod said they “don’t expect a return to pre-COVID-19 for some time” with people already planning to spend significantly less on non-essential goods and services, on trend with past recessions. With this comes the potential for brand relationships to become fragile, consumers could be left feeling abandoned due to advertising cuts. They may associate a brand with lack of stability and drive customers to a more aggressive competitor. According to the Journal of Advertising Research, companies that chose to continue ad spend experience higher sales during the recession and years after.
Source: Journal of Advertising Research – April 2009
An example of a brand who had huge successes during a recession is Kellogg’s in 1929. In the 1920’s, Post was the leader in the US cereal category but during the Great Depression, Post cut back significantly on their advertising spend. This allowed Kellogg’s, who doubled its advertising spend, to grow its profits by 30% and became the category leader post-recession.
In 2009, Amazon US was innovating towards products that would help grow their market share. During the Great Recession of 2009, Amazon US continued to advertise and even released new, more affordable Kindle products. In the eyes of the consumer they became an innovative and ‘for the people’ brand by introducing a lower cost alternative for people going through economic hardship. By Christmas Day 2009, Amazon had sold more e-books than printed books, ultimately growing their sales by 28%.
How did brands react to COVID-19?
We have seen brands from across the globe come together with the same overarching message; stay at home, we are in this together. Here in NZ, AMI released their KindCast campaign, because “right now, kindness is more important than ever.” They handed their social media and TV ads to the New Zealand public to share their messages of kindness and thanks. It was as simple as going to the KindCast website and uploading a 10-second video saying whom you want to thank. This seemingly simple yet impactful campaign elevated the AMI brand and this message of kindness will stick in the minds of Kiwi’s for years to come.
Other local brands who adapted to match the changed consumer behaviours included Purina, where they launched a free online learning programme with weekly challenges for you and your pet to upskill together.
New World collaborated with the Christchurch Student Volunteer Army to help provide meals and groceries to those who were unable to shop for themselves or couldn’t afford to buy the groceries they needed.
2 Degrees launched their #Togetherwecam campaign, encouraging users to send screenshots of their Zoom, Skype, FaceTime catch-ups with friends and family to share the love. They also uploaded instructions on their website around how to set up a video call for people who may not know how to do this, such as the elderly.
Globally the trend is similar; some worthy mentions include AB InBev who redirected $5 million that would have usually be spent on sports and entertainment marketing to the American Red Cross to support the fight against coronavirus. TIME for kids offered free access to their digital library, complete with quizzes and worksheets, for the rest of the school year and Nike launched ‘Play Inside, Play for the World’ where they gave everyone free access to the premium features of the Nike Training Club.
Brands must adapt quicker than ever to avoid being left behind. A time of crisis is when it is most important to show empathy and fuel the connection between consumer and brand, yet some brands have chosen sympathy over empathy which is why some organisations feel more out of touch than others. Brene Brown said “Empathy fuels connection, sympathy drives disconnection.” It is important for brands to consider who they are speaking to and how they might be feeling.
Now that a sense of normality has set in, with New Zealanders back at work and allowed to go about their days as they did pre-COVID, it’s easy to forget the hard work that everyone put in to get us to this point. For now, it is too early to tell what the long-term implications COVID-19 will have on the industry locally and globally, let’s hope that the theme of togetherness and connection continues.
