Short-term, the COVID-19 pandemic altered consumer behavior. In McKinsey & Company’s consumer sentiment pandemic tracking surveys, 2/3’s of consumers indicated they are uncertain of their future; 50% are going to be careful and cut back on their spending. Consequently, marketers are proceeding with caution, while strategizing for economic recovery.
Online marketing gurus (a.k.a. consultants) are posting a plethora of advice on how best to adapt to the new marketing challenges in a coronavirus world. In this post, I chose to simplify the best of their clutter.
- Online sales increased significantly, especially grocery sales during the shelter-in-place phase of the COVID-19 pandemic. Note: Total online U.S. sales increased 25% on average mid-March compared to early March; grocery 100% (source: Adobe Analytics). The spike in online sales was primarily driven by two demographic groups: Millennials and higher-income consumers. This will not be a temporary shift in consumer buying habits as more consumers continue to reduce their in-person activities and further adapt to digital technologies to shop for household essentials, food-away-from-home delivery, etc.
- Online sales represent a plethora of data points about consumers’ purchase journeys. Marketers will benefit from the utilization of AI to mine the new treasure trove of pandemic online data.
- Brands are utilizing social media platforms to communicate their empathy for the stress consumers are enduring during difficult times. They are also finding new ways to support communities and front-line workers (e.g., virtual streaming events). Some fashion and apparel brands are still relying heavily on influence marketing (a.k.a. brand ambassadors). However, moving forward it would behoove smart marketers to solicit UGC (User Generated Content) to best communicate brand authenticity.
Are you prepared to adapt to the new marketing challenges?
I was talking to my brother who lives in Maine. He shared with me the state’s four-stage gradual reopening plan, specifically the impact it will have on tourism and the state’s economy. Reminded me of what is happening here in Cannes without the film festival, a total COVID-19 Domino Collapse!
By the numbers:
- An estimated 28 million tourist visited Maine last summer. Note: State population 1.338 million.
- Total expenditures for tourism, $6.2 billion at last count (2018).
- Tourism supports approximately 110,000 jobs; 16% of the state’s employment.
- Average stay 3 to 4 nights.
Governor Janet Mills announced as part of the state’s recovery plan, a 14-day quarantine for all out-of-state visitors. Obviously 2020 is not going to be a banner year for Maine’s summer tourism. All I can think about is the COVID-19 Domino Collapse that will result. Below are a few potential economic blows:
- The hospitality industry – Lodging revenue, businesses that supply hotel & motels with linens, cleaning materials, etc.
- The restaurant industry – Lost F&B sales, businesses that support restaurants like equipment, cleaning materials, waste removal, etc.
- Local food supply chain – The decline in primary and secondary distributor sales, local signature specialties like produce (e.g., Maine russet potatoes, blueberries), lobster, seafood, etc.
- A reduction in the discretionary income spent on necessities (e.g., groceries, personal care, etc.) by all the unemployed or furloughed workers due to the decline of the three industries mentioned above.
- Recreational rental revenue – Boats, canoes, kayaks, bicycles, etc.
- Tours – Cruise ships, buses, fishing, New England Clam Bakes, etc.
- Camping related revenue – Campsite fees, camping paraphernalia and supplies, etc.
- Reduced outlet sales (e.g., L.I. Bean) in Freeport.
I could go on and on and on. Do you have any Maine tourism dominoes to add to the list?
Moving forward, whenever anyone talks about the macroeconomic crash of a business sector impacted by our current health crisis, like Maine tourism, I will continue to analyze the microeconomics resulting in total COVID-19 Domino Collapse.
Lockdown ends today here in France. Every nanosecond crept by. I ate and drank well, basked in the Mediterranean sun on my balcony, worked, read and wrote. During my lockdown, I was able to regularly engage via technology with family, friends and business peers.
- As the pandemic began to unfold, everyone would share their concern about getting sick, the COVID-19 statistics, social distancing and how the outbreak would impact their personal life. Perspectives about a post-pandemic world were myopic.
- The #1 overused cliché: “It is, what it is” meaning we all have to deal with the COVID-19 outbreak, a challenging, frustrating situation that cannot be changed. Most people indicated we just have to deal with it.
- As the curve began to flatten and details emerged about re-opening the world, people were buzzing about a vaccine being the solution without recognizing the geo-politics, time line and dollars associated with global vaccines.
- Everyone understands we are going to witness major global transformation (social, economic and political) and experience the “New Normal.”
“New Normal?” The definition of normal – conforming to a standard, usual, typical, or expected. A standard day? A typical week? I do not accept the concept of the “New Normal.” Instead, I believe we now live in a “New World,” a world where one size does not fit all. Example: The different ways three countries handled the outbreak – Sweden with herd immunization, France with strict lockdown rules and the United States with mixed messaging resulting in chaos.
Over the past few weeks, I have published numerous posts advocating “to build a better world, start in your community.” As I get ready to leave my apartment later this morning, I am prepared to face the unknown challenges of the “New World” where one size does not fit all.
Recently I posted an article on LinkedIn titled Where is the Silver Lining Ahead? I advocated how the power of community initiatives will lead global transformation post-pandemic. Below are two great transformation tales.
- A Food Waste Tale – Needless to say, being a veteran of the food-away-from-home business, I was appalled when I first learned about the pandemic food waste problem – farmers dumping milk, smashing eggs, letting produce rot in their fields. The reason being their primary market, foodservice shutdown and evaporated overnight. Consequently, they did not have compatible retail size packaging or the proper “go-to-market” logistics in place. Quickly, southeastern grocery leader Publix step up to the plate with a solution. They announced at the end of April they will be purchasing milk and produce in their region to donate to Feeding America food banks. A total win-win: food banks can help families in need of food while farmers receive some financial support during the Covid-19 pandemic.
- A Toymaker Tale – In mid-April, global toymaker Lego based in Denmark, announced that they were going to join humanitarian forces with frontline healthcare workers fighting the Covid-19 outbreak in Denmark. They committed to producing 13,000 face visors a day. In addition, they will be donating half a million Lego sets to children. Community, community, community.
“To build a better world, start in your community.”
Mark your calendar, 3/17/2020 was a significant day in French history. It was the date the country locked down and observed confinement to level the curve of COVID-19. More importantly, it was the day France’s cultural etiquette morphed.
Below, a quote from Thomas Friedman’s New York Times op-ed “Our New Historical Divide: B.C. and A.C. – the World Before Corona and the World After”:
“So, a virus-laden bat bites another mammal in China, that mammal is sold in a Wuhan wildlife market, it infects a Chinese diner with a new coronavirus and in a few weeks all my public schools are closed and I’m edging six feet away from everyone in Bethesda.”
Edging six feet away from everyone in his hometown Bethesda, MD is known as the practice of social distancing. The etiquette of social distancing will vary around the world. However, here in France, 3/17/2020 was the day “Faire La Bise” better known as cheek kissing became extinct.
What will be the significant cultural etiquette change in North America?
Recently I read in the culture section of The International New York Times an article about the release of books being published geared toward 6-to-11-year-olds explaining the pandemic. Then I had an objective reflection.
What would be the result of a whole generation growing up deprived of playgrounds thanks to social distancing?
In my last post of 2019 titled Playground Lessons, I wrote about how playgrounds enable children to learn and connect with other people (peers, family) to build trust and friendship. In addition, playgrounds are blank canvases for their imaginations to flourish and grow.
How do we keep our playgrounds socially open?
Over the weekend I reviewed in depth McKinsey & Company’s global consumer survey in the midst of COVID-19. The results regarding economic recovery varied greatly. Then I thought about my home city, luxurious Cannes and the potential unprecedented cancellation of the 73rd annual Cannes Film Festival.
Before analyzing the economic impact on the film industry, detailed below is a list I drafted of businesses and individuals (a.k.a. festival ecosystem) that would suffer a staggering financial hit:
- Transportation to and from the festival – airlines, taxis, limo services, Uber, etc.
- Lodging – premium hotels, luxurious villa rentals equipped with staff and swimming pools, Airbnb and budget hotels.
- Furloughed hotel staff (e.g., front desk guest assistants, bellman, room service, etc.) and housekeeping, as well as all the supporting sustainable housekeeping businesses – cleaning equipment/materials like laundry detergents, toiletries, etc.
- Restaurants and bars in Cannes plus surrounding areas; La Napoule, Mougins and Juan les Pins.
- Local transportation to and from events – taxis, Uber, limousines, luxury car rentals, mopeds, bicycle rentals, etc.
- Maintenance staff, carpenters and electricians at Palais des Festivals et des Congrès where the films are screened.
- Tourism related jobs – hostesses at Office of Tourism, tour guides, etc.
- Yacht rentals.
- The event companies responsible for setting up film billboards and banners along the Boulevard Croisette.
- Beach businesses – chair rentals, towels, etc.
- Independent beach vendors selling sunglasses, hats, visors, candied nuts, etc.
- Sun tan lotion.
- Hairdressers, makeup artists and all the businesses that supply them with products.
- Luxury retail shops.
- City of Cannes and film festival souvenirs/mementos.
- Landscaping/gardening services that prune the palm trees and plant flower beds along the Boulevard Croisette.
- Illegal substances, sex workers.
- Service gratuities!
I hope I witness first-hand the 73rd annual Cannes Film Festival.
Last week, I posted about premium mangoes. Today I want to post another fruit story. The Migaki Ichigo premium strawberry brand. Individually wrapped, they can be purchased at select Japanese department stores and online for approximately $10 per berry. The brand is the master mind of tech savvy Hiroki Iwasa.
Hiroki Iwasa’s guiding principle? “Action Creates Value!” If you have a strong idea, take action immediately. People will begin to show interest in your intentions and support you. By doing something without delay, you inevitably will make mistakes, but learn how to take corrective action until you get it right.
Hiroki Iwasa’s story dates back to March 2011 when he returned to his hometown Yamamto as a volunteer to clean up the rubble from the earthquake and tsunami. The town’s people challenged him to start a business and create jobs. After learning the area was best known for its cultivation of strawberries, later that year, he worked with one of the local farmers to acquire the knowledge of what it takes to be a successful strawberry farmer – tabulating all the quantitative information about ideal growing conditions. That is when he decided to leverage his technology experience and founded the agriculture company GRA Inc. He wanted to perfect strawberry farming by creating farming jobs to strengthen the regional economy and utilize greenhouse sensors to monitor crops 24/7. The end result was the Migaki Ichigo brand where one out of 100 strawberries grown are graded platinum for their color, sweetness, tartness and aroma yielding a price of 1,000 yen (approximately $10). However, after several successful harvests, rather than expand his own company, Hiroki set up a school on his farm to share his knowledge. GRA’s vision: Create employment for 10,000 people, for 100 companies and for 10 years.
Two premium fruit stories. One about the patience and fortitude of mango farmers over three plus decades of hard work. The second about a tech savvy entrepreneur utilizing Artificial Intelligence (AI) to enhance his strawberry production within three years. Both have a common connection. Agriculture is a collective, collaborative process that grows regional economies.
Are you ready to take action and create value?
Have you ever been gifted a piece of fruit? In Japan it is common practice, especially as a token of gratitude. One popular fruit for gifting is Taiyo no Tamago (Egg of Sun), a premium variety of mango, a great story about the virtue of patience and fortitud
Back in 1985, a group of farmers (8) in the Miyazaki prefecture located in southeastern Japan were seeking another crop to supplement their cucumber and green pepper harvests. They decided to give mangoes a try given the warm, sunny climate of their area. After six years of trial and error, experiencing numerous diseases, they finally produced a successful harvest. However, they had to go to local farmers market to sample their product and build awareness. Mangoes did not become a popular fruit in Japan until ten years ago.
Why am posting about mangoes as a great story about the virtue of patience and fortitude? Every April a mango auction is conducted at the Miyazaki City Central Wholesale Market. Mangoes are judged/graded by size, shape, color and their brix level of candy-like sweetness. You can now find the Miyazaki premium mangoes specially packaged at select retail stores for $100 to $200 for one. Last year at the auction a pair sold for $5,000. Imagine, mangoes, priced comparably to a big bottle of red wine from a select French vineyard. Their hefty price tags reflect years of experimentation, the labor of love dating back to the time Miyazaki farmers started cultivating mangoes in the 1980s. Patience and fortitude! Therefore, the next time you are thinking of getting someone close to you a unique gift, think about gifting them a Taiyo no Tamago (Egg of Sun) mango. Better yet, buy them a vacation package tour so they can explore the mango farms of Miyazaki.
Key learning: Successful long-term business initiatives are the byproduct of patience and fortitude.
Marketing continues to morph. In my last post I addressed the importance for smart marketers to utilize a combination of tools (a.k.a. omnichannel marketing) including influence marketing to reach their target audience. Thanks to existing consumer data, get ready for an innovative wave of personalization marketing.
I first addressed the expansion of data captured at numerous consumer technology touch points in a 2018 post titled Psychographic Profiling as a means to enhance identifying/targeting consumers. Fast forward to 2020. A new survey (source: Merkle) revealed a large majority (88%) of data driven smart marketers are planning to implement omnichannel strategies, including the expansion of personalization, to make their customers’ digital journey seamless. However, only one-quarter of the survey’s respondents currently focus on real-time digital tactics. Moving forward, the key for brands will be to invest in marketing technology and measurement analytics.
The upsurge in digital channels over the past few years has enabled marketers to collect mountains of data they can personalize. One simple tool is an app. A great example is how Starbucks engages each of its guests based on their in-store purchases and location. Some marketers like Spotify utilize algorithms to crunch data to predict user behavior. With the advent of AI-powered tools, personalization will become even more sophisticated and deliver marketing communications in real-time (seconds) across multiple channels. However, the utilization of personal data will always be a pending issue with consumers. Nevertheless, research indicates as long as consumers believe they are receiving value in return for personal data, personalization is key to winning their loyalty/business.
2020 Personalization Marketer of the Year – Big Brother!