22 July 2020
The 5R strategy to getting your business back on track
The current situation has disrupted business operations worldwide, leaving many companies scrambling to implement an effective response. In the wake of the crisis, we’ve been hit with an avalanche of fatalistic information and fear-inducing content. For businesses to remain effective and competitive, the focus must be shifted instead towards being proactive.
The five-step approach crafted by management consulting firm McKinsey & Company, can be applied to the “new normals” in marketing and advertising to help businesses prepare for the future.
Companies looking to not just survive, but thrive must begin by addressing any immediate challenges they are facing. Plans must be escalated to facilitate the continuity of business operations while ensuring the health and safety of employees and customers. There must be a common sense of resolve to realign the business with its goals and remain front-of-mind among consumers.
Many retailers have ensured their success through new business collaborations, new ways of servicing customers, new product offerings and more. For example, Airbnb – a company whose business is based in travel – has been offering virtual visits with dogs in Chernobyl, cooking with a Moroccan family and meditations with Buddhist monks in Japan.
Resilience is no longer an option – it’s a necessity for persevering through trying times. How resilient are you? How resilient is your business? Now is the time to address any immediate resiliency issues.
Resilience is no longer an option – it’s a necessity for persevering through trying times.
Recent research by the IAB found that most companies surveyed reported they had already begun to make changes in their ad spending. Many companies are focusing on decreasing ad spend across the board – specifically the billboard. OOH, digital OOH and terrestrial radio spending has been substantially cut due to the current climate, but it becomes less about halting all ad spend and more about making necessary adjustments, such as advertising at locations that have essential businesses where foot traffic may be higher. While there have been large cuts in advertising dollars, a recent survey found that consumers don’t think brands should stop adverting.
“It’s less about being very commercial and promotional in our messaging and a lot more about how do we really express the heart of this brand,” says Marisa Thalberg, Lowe’s VP and Chief Brand and Marketing Officer.
It’s evident that brand purpose will be a strong component of messaging during this time.
Now is the time to craft a detailed strategy to return business to scale. Businesses looking for a concrete approach should focus on the following actions:
Information/Education: Keep employees and customers well-informed and regularly updated on the most recent news about the status of your operations and any potential changes that may affect them.
Reassurance: Reassure employees and customers that they can trust you during the hard times. Give them confidence in your brand and detail the steps your company is taking to ensure they receive the same level of care they are used to.
Entertainment: Consider the current climate and context. Focus on messaging related to being homebound and find interesting ways to engage your customers and provide them with novel experiences online. Think of new ways to inform, educate and interact. For instance, now is the time to start experimenting with new forms of content, such as videos, livestreams or podcasts.
Loyalty: Now is the perfect time to shift your focus towards cultivating loyalty and long-term relationships. Consumers will continue to seek deals with the threat of a recession, throwing brand loyalty to the wind at times, so concentrating on your current customer base and finding ways to make your customers feel special and cared for is extremely important.
This also lends an opportunity to engage new audiences. For instance, several fitness companies are offering certain classes for free to entice new customers to sign up at a later stage. Others have been offering Instagram Live classes while promoting additional subscription models for access to more online classes.
Understanding location will be more important than ever before
As restrictions begin to relax, there are many strategies brands can take to rebuild market-share. Neighbourhood shops and other local establishments may want to target particular customers with personalised offers based on their past visitation behaviours and current whereabouts. By analysing visitation patterns, restaurants can target their most loyal customers with targeted messaging such as having “first-dibs” on reservations.
By analysing visitation patterns, restaurants can target their most loyal customers with targeted messaging.
Similarly, retailers can offer loyal customers early access to their stores or be the first to book an appointment-only visit. Using geofence technology, sales associates could be alerted that customers are nearby the store and prepare to meet them once they arrive. Once in the store, the customer could be notified that the sales associate will be with them shortly. Or maybe retailers want to send limited time offers to those who haven’t visited a store recently, but have frequented competitor locations.
It comes down to creating compelling, differentiated offers, by taking a customer-centric approach and developing a deep understanding of each shopper as an individual, and location can help.
Brands will need to begin reimagining the “next normal” and take the appropriate steps to prepare for the future and, possibly, reinvention. While some companies have been confronted with their new found vulnerabilities, this can be used as an opportunity to adapt and thrive in the future. Perhaps your business operations could benefit from a greater degree of flexibility or efficiency, i.e. BOPIS, curbside pickup or other contactless solutions. The result will be an increase in strength, resiliency and productivity.
What will the store experience look like? What will the live event experience look like? The fitness experience, and so on? Nike has already begun reinventing the in-store experience with “scan-to-learn," allowing customers to scan a mannequin to learn more about the product. Models like this will become even more important as retailers adopt more contactless solutions.
Companies should begin thinking about and preparing for the future and how both the regulatory and competitive environments may change. Strategies will vary greatly between businesses and industries, but the goal should be to ensure that your company emerges better prepared for potential obstacles than it was before.
The goal should be to ensure that your company emerges better prepared for potential obstacles than it was before.
Brands across all verticals should be prepared for the ways consumers have adapted to the new normal and as such, new channels of communication and shifts in marketing strategies should not be discarded.
What lies ahead
It’s important to take this time as an opportunity to be proactive, increase your ability to adapt under pressure and get creative. The current situation has not brought an end to brick-and-mortar, but the way stores operate will change. Local businesses that have historically relied on foot traffic for their main source of income will need to develop alternative revenue streams. Digital and physical channels will be even more closely connected as the adoption rate for an omnichannel presence becomes greater.
If ever a silver lining, the way brands have developed innovative solutions to unforeseen challenges and built more authentic connections with consumers is a new normal we can get behind.