The first wave of the coronavirus storm has hit us all hard. These are deeply troubling times. Businesses all over the country are uneasy, concerned for their people and worried about their futures. Now is the time for us in Irish businesses to show leadership and harness the power of our brands to meet this latest economic challenge. To beat this quickly we must be united, together (whilst keeping a safe distance apart).
A week is a long time in a global pandemic.
Just like every other business and family in Ireland, all of us at Bradley has been forced to adjust rapidly to the reality that is the COVID-19 outbreak.
Within a very short space of time, new terms have filled our daily lexicon: coronavirus, social distancing, self-isolation, antivirals, underlying conditions, and lockdown, to name but a few. Yet, it’s often old terms, returning like a ghost, that can worry us the most. The word ‘recession’ is once again on economists lips as the inevitable consequence of this perceived black swan event in our lives.
Although recessions are seen as a market correction, it’s important to note that on this occasion it was triggered by a supply-led economic shock; a consequence of social-distancing that shuttered businesses, tourism and sporting events. Most businesses are now considering their options, with home working, job sharing, reduced hours, and short term contracts being forced upon the country’s workforce.
With self-isolating and social distancing initiatives, household consumption patterns and buying behaviour have shifted dramatically within a short timeframe. Nielsen Ireland is reporting a +5.6% increase in FMCG sales in the last 4 weeks to 8 March 2020, with Hand Sanitisers >+1,000%, Antiseptic +280%, and Soap +231%. Pantry stocking of perishable foods has risen sharply, with Ambient Pasta +58%, Canned Vegetables +44%, and Canned Fruit +43% the biggest category winners.
We’ve all witnessed or read about the panic buying actions of some in supermarkets around the country. As shoppers, we may never look at toilet paper in the same way again! But, can you remember what brand they were buying? Probably not. Why? Because in survival mode we are less concerned about brand choice and value-added, and more concerned about physical availability and satisfying our basic human needs.
This current market dynamic has tangible consequences for brands, with product samplings, experiential marketing and branded events being put on hold as part of the new social distancing rules. With less ‘dwell time’ in stores as shopper missions are more pronounced, the effectiveness of point of sale tools and promotional mechanics are diminished.
What now for brand owners and owner-operated businesses? At times like these, when a brand’s fundamentals of visibility, availability, value, relevance and trust are truly tested, we see it’s the brands that stand out from the crowd that will thrive.
One thing we have learnt about ‘the great recession’ of 10 years ago is that those businesses which started or continued to invest in advertising and marketing, to create strong healthy brands, grew and maintained their market share when the market returned. In fact, this market insight has withstood the test of time.
A case in point is from an article published by Forbes recently entitled “When A Recession Comes, Don’t Stop Advertising”, reinforcing how investing in advertising and brand building activities can have positive long term effects on your business. In one case study, Forbes cites the ready-to-eat cereal category leader in the USA at the time, Post, cutting back its advertising budget significantly during the Great Depression. It states, “their rival Kellogg’s doubled its advertising spend, investing heavily in radio and introducing a new cereal called Rice Krispies, featuring “Snap,” “Crackle” and “Pop.” Kellogg’s profits grew by 30% and the company became the category leader, a position it has maintained for decades.” The rest, as they say, is history.
Facing today’s challenges, the team here at Bradley are determined and dedicated to supporting all our clients in rising to the various challenges placed on their businesses and brands, in these uncertain times.
Over the course of the next few weeks, we will be sharing positive insights, branding ideas and innovative content that will support you and your brand to navigate these choppy waters.
Stay safe out there. We will get through this together.
The Bradley team