Happy Indian New Year! Let me hope it works out better than the one that started on January 1st 🙂
The virus continues to haunt us with its unpredictable and uncontrollable behaviour. But now have some clarity on what the economic impact of this lockdown is going to look like when we emerge from hibernation. So time to take a (figurative) look at the world outside. You won’t need sunglasses – it’s not too bright out there. While COVID is uncharted territory, a downturn is not and there are playbooks available. COVID adds some extra dimensions like social distancing and hygiene which may also have an impact on your marketing and product viability.
The first sets of research reports are coming out so you can check whether your hunches on consumer behaviour are right. In a recession people tend to trade downwards and avoid luxuries and that’s already happening. The difference is that due to COVID items like toilet cleaners or sanitizers which may not have been considered essentials are now high priorities. Take a look at the Kantar World Panel Report on Consumer Responses to COVID which has the data.
B2B will play out similarly except of course what an enterprise considers essential and what’s the business equivalent of the high net worth financially stable consumer will be different. To quote Tolstoy “Happy families are all alike; every unhappy family is unhappy in its own way.” In a downturn everyone is miserable, but in a different way and product selection and marketing programs have to recognize that. Laser sharp positioning and targeting will help you conserve marketing money. You can cut down on long term brand investments for the next 6 months as well as avoid marketing to those with less propensity to spend. This may involve switching off spends for regions or segments. Instead of waiting for the axe to fall on your marketing plan, you may wish to use this template to propose a new marketing plan at least for the next 6 months.
I’ve created an article which includes a checklist which will help you map your products on the dimensions of Covid Context and Recession Relevance, and then map your clients on financial situation and business outlook. This will tell you what services/products are most relevant in the new reality and also who would be most receptive to which set.
After resisting learning to cook for decades we have finally succumbed and dusted out the boxes of Shan masala and the Mealthy instant pot. We had biriyani and payesh for the Bengali new year which I’m inordinately proud of. Unlike when I first had to fend for myself there is a masala for every possible cuisine and in a format where zero knowledge is required. Similarly the videos are precise and the Mealthy cook times are standardized – no more “pinch” of or “simmer till bubbly”. Cooking education has been democratized and you can learn from the best, even if you can’t tell jeera apart from dhania. Same with home beauty care – way easier than 20 years ago.
Will our long term behaviour change is a question that is often asked. Penetration of certain products (dishwashers, instant pots, home beauty care) and behaviours (work from home, virtual meetings) has definitely been accelerated. And businesses that have found success with new offerings will try to continue these beyond the lockdown. But if you’re expecting that people are going to return to a simpler non-materialistic lifestyle that will be driven more by necessity than a change in heart.
Thanks for keeping me company as the days blur into each other. Thursdays help me stay on track!
If you’d like help plotting your Covid-Context or Recession Relevance charts feel free to comment on this artcle.