Hi. How is everyone doing? First of all, I hope you are keeping healthy, washing your hands frequently, and social distancing. This is a difficult and isolating time in many ways (personal, social, professional) and l hope to make it a little bit easier with a few tips for your marketing strategy from some things we’ve learned just over the last while.
Consumer Behavior Changes
First, good news. If you are a retailer, either online or with storefronts, that sells health products, paper products, or food, you are most likely seeing an increase in consumer purchases of those products.
There are stories all over the news about stores selling out of toilet paper, hand sanitizer, and other products that people are stocking up on in the event of a lockdown. That is good news for many retailers. Unfortunately, some retailers are also seeing disruption in their supply chain, since many goods come out of China, who has mostly shut down manufacturing in affected areas.
Now, the not-so-good news. The stock market is tumbling. In many areas, governments are recommending or requiring that people do not leave their house or congregate in large numbers. This means that conferences, concerts, events, theatre, church, and attractions are being canceled both in the US and Internationally.
Businesses are sending employees when possible, schools are putting their classes online and sending students home, and people are being asked to stay home and socially distance themselves from one another.
Restaurants and brick-and-mortar stores that don’t sell essential supplies are empty, even if they are still open. Many businesses are closed for an unknown amount of time. Associations that rely on national or international conferences to make money are delaying or canceling events.
And, even if your industry is not directly influenced by the outbreak, consumers, in general, are uncertain about the future and unlikely to commit to anything that involves travel or leaving the house in the next few months. They are canceling future plans and asking for refunds on travel purchases like airline tickets, cruises, and event tickets. The outbreak could have a long-reaching impact on many businesses for the rest of the year. It could even end up causing companies to go out of business or go bankrupt.
On the marketing front, agencies and marketing departments are seeing the impacts in both national and international campaigns. Search volume is not following normal seasonality patterns, rising in some industries like health, news, consumer goods, and at-home entertainment, and decreasing in other industries like business products/services, travel, and events. With our PSM education clients, we are also seeing a decrease in search volume around education plans and applications. People seem to be uncertain about the future at this time.
First, good news: (for advertisers, not Google and Facebook), many businesses are decreasing their advertising spend or not advertising altogether, especially if they are in industries that are hard-hit by the outbreak, like travel and events.
This means that many advertisers are seeing their costs-per-click decrease on Facebook, Google, and Microsoft ads. This could allow them to reach a larger audience at a similar or lower budget than before. And, since folks are being encouraged to stay home and also work at home, consumers are spending more time on the internet than ever. There is a large advertising opportunity for companies that are able to be flexible and pivot with the trends that they are seeing in their industry.
While consumers may be spending more time online and seeing more online ads, they are hesitant to make decisions about the future. If your product or service requires commitment or future planning, you can expect your conversion rate to be lower than normal during the outbreak.
This can also be an opportunity to increase your brand awareness and engage with consumers before purchase. And then, after the outbreak lessens and restrictions are lifted, you can remarket to that audience and get the purchases.
How can marketers adapt to these changes in behavior and marketing strategy?
In some verticals, it may make sense to decrease or even pause advertising for now. For example, for event marketers, if you don’t know when your next event will take place, it may make sense to wait.
For verticals that may feel the effects of caution for a longer time, like cruise ships, it may make sense to hold on advertising for now. But for many businesses, there are advertising opportunities now to connect with new customers that are at home and spending more time online.
While conversion rate may be lower in your industry right now, you can focus your spend on the awareness and consideration portions of the sales funnel. Later, when consumers are ready to purchase again, they will be familiar with your brand and a part of your remarketing audiences.
You should consider creating a conversion that is easier than a purchase to gain people’s information for use in later email marketing. For example, an association that had to postpone its national conference can consider a Facebook Lead Generation campaign using the same target audience as their registration ads but instead collecting emails so they can send updates when registration re-opens.
Or a school can collect potential student information in a contact form and start an email drip communicating with them while programs are paused. Then they will be able to send an email when travel restrictions are lifted and classes resume.
While CPCs are lower, you may want to spend more budget on non-brand searches for your products. Social Media, Display, and YouTube campaigns have low costs per click and are a good way to show your ads to many viewers at a cheap budget. This is an opportunity to get creative and really engage your audience with great content and eye-catching visuals!
Finally, you want to make sure that you are closely watching your data and following trends that you are seeing in your accounts and audiences. Every industry, vertical, and brand will have unique challenges and opportunities.
If you have a business that advertises in different cities, states, regions, and countries, each location could have different trends and timelines, depending on the severity of the lockdown and when it occurs there. Marketers should be pulling location reports at least weekly at this point to make sure that they are optimizing budget to different locations and staying on top of trends. Decision-makers in businesses need to be flexible and able to quickly adapt, make decisions, and shift budget and priorities as consumer confidence changes.
When the lockdown eases and purchase behavior starts to increase again, businesses and marketers should be prepared for a surge in conversions and search volume. After staying at home, people may be eager to travel and attend events. Consider having an extra budget saved for that time.
It may not happen at the same time for each location but may be more spread out. Be ready with remarketing campaigns to reconnect with the people that visited your business before and during the outbreak. Remind them about your brand and product and urge them to visit again and make that purchase. It may be a great time to have a special promotion. If you had to postpone an event, offer your early registration pricing at that time. Get those consumers excited at the chance to purchase with you.
This is an uncertain time for consumers, businesses, and marketers. But, with uncertainty, also comes opportunities that can be found by taking a deep dive into your data and finding what is working and what is not working in your vertical. With the help of an agency, you can develop a detailed, flexible strategy for as long as this situation continues.