The Winds of Change

Rob Levine

by Rob Levine

Partner / VP of Account Strategy

Former Chicago Mayor Rahm Emanuel famously quipped, “Never let a good crisis go to waste.” Many industry experts have echoed this refrain in the wake of COVID-19. As marketers, we like the predictability of a strong case study to guide our thinking; however, this situation is so unique, we are left to piece together our best guesses.

Post-9/11 business and industry came together to spur the economy forward and create a semblance of normalcy. The federal government urged us to travel again and General Motors famously gave us the opportunity to “keep America rolling” with their first broad-based 0% financing offer across all brands. As dutiful New Yorkers, just a month after the tragic event, with Mayor Giuliani declaring New York back “open for business,” my wife and I ventured out for dinner at Blue Ribbon Bakery, traveling only five blocks away from Ground Zero.

Because of the protracted period of disruption, today’s situation feels markedly different – it is less about when we return to normal and more about defining the new normal and the role of brands. In the short term, brands are best served by maintaining an empathetic presence in the hearts and minds of their targets. Go dark and run the risk of fading from memory; ignore or aggressively sell, and appear tone-deaf.

We will all experience at a minimum four to six weeks of significant behavior change. The real opportunity for us to ponder is which of these behavior shifts will stick, and how well positioned are our brands to capitalize on those changes? Rate reductions in 2001 not only put more Americans in new cars, but also spurred the housing boom, which powered the economy and accelerated the rise of the HGTV lifestyle, which persisted through the housing crash. Conversely, after Hurricane Andrew, divorce rates in Dade County spiked by 30%. Major unexpected lifestyle disruptors cause consumers to take stock in what is important and often result in behavior changes – large and small.

As quarantine orders lift in the coming months and we are left to face our new reality, home haircuts and Zoom cocktail parties are likely to fade. But as we look across the food and hospitality industry, there are signs that many shifts will stick. Consider this:

  • Vacationing: as Spring break trips are scrapped and summer plans are up in the air, expect leisure travelers to stay and play closer to home. Not only is there security in the familiarity of vacationing nearby, but driving trips provide more flexibility and control. Would DMOs be wise to refocus on targeting their home audience and markets that are in close proximity?
  • Business Travel: a friend shared that he had to cancel a trip to see a major retailer in Arkansas. Instead, he presented his fall line via Zoom. He still walked away with the order and saved almost $5,000 in travel and entertainment. Before we hit book, will we pause to ask ourselves, “Could this meeting be a Zoom?”
  • Online Grocery Ordering: The quarantine has caused panic buying and put tremendous operating pressure on the grocery channel. This has caused a significant increase in adoption of online grocery ordering, both for click and collect and at-home delivery. Will these consumers return to their old brick and mortar behavior? Surely a cohort will emerge that will stick with the new model post-crisis, creating another group that marketers will struggle to reach with traditional in-store tactics.
  • New Products: Panic buying has created scarcity at shelf and has forced the consumer to make substitutions. We’ve seen an increase in adoption of private label across all categories. The fresh meat case has seen weekly sales increases of upwards of 70% three weeks in a row. During the week of March 22, three fresh proteins more than doubled sales versus the comparable week in 2019: fresh turkey (+126%); fresh exotic meats, such as duck and bison (+123%); and pork (+101%).* Is there a chance that post-crisis, these are upgraded to everyday proteins in some span?
  • Contactless Transactions: Commercial foodservice has been hit significantly hard. Operators with a strong takeout/delivery business and infrastructure are best positioned for survival. Even so, increased safety concerns have consumers zeroing in on the minimization of human contact in both pick-up and delivery. How will this manifest itself when dining rooms reopen? Will silverware be packaged in a plastic wrap? Will servers wear rubber gloves? Will there be more kiosk and tablet-based ordering? How will this impact front-of-house and back-of house sanitation practices and products for all restaurants?

It is important to respond to the crisis in the short term in a way that is measured and relevant to both the brand and target. It is equally important that brands stop and take stock of the potential long-term impacts of this unprecedented event. But let us be certain of one thing—there is only one direction, and that is forward. As brand owners, we must manage the business for today and do the strategic roadwork to ensure we meet the needs of tomorrow’s consumer.

To discuss how the new realities of marketing could positively impact your business, contact David Melnick, VP of Strategic Partnerships.

*Sources: IRI and 210 Analytics

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