Chapter 7:
The Path Ahead for Reigniting Demand in the Post-Pandemic ‘Normal’
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“Perhaps the best way to understand what we’re facing is to recognize [it] as a [business] disruption. When we see it this way, we see that the future after the pandemic is not that all uncertain because we have been through disruption before. We know what the future holds.”
J. Walker Smith Analyst and Chief Knowledge Officer for Brand and Marketing at Kantar Consulting
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There are several ways the COVID-19 pandemic has accelerated ecommerce demand across a wide range of categories, and there are many best practices for brand manufacturers hoping to best position their brands amidst this “next normal.” Many businesses are alternatively facing a historic drop in demand — particularly those operating in “non-essential” categories. For those capable of weathering the hit, successful strategies remain focused on maintaining short-term viability while taking steps to reap the benefits of an expected future rebound in consumer confidence and demand. Even businesses that are well-positioned in the pandemic economy should be taking steps for a return to near normalcy. Several experts shared actionable insights at the Digital Shelf Virtual Summit, presented by The Digital Shelf Institute (DSI), for preparing for a post-pandemic economy.
J. Walker Smith
Chief Knowledge Officer - Kantar
Walker Smith was named one of America’s leading analysts on consumer trends by Fortune Magazine, and is chief knowledge officer at growth consultancy firm Kantar.
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Jamie Dooley
Partner in ecommerce practice - The Partnering Group
Dooley brings over 20 years of experience in ecommerce and merchandising leadership, including roles with multiple global Fortune 500 brands like Keurig, Target, Wayfair, Staples, and Dunkin’. He is a partner in the TPG digital commerce practice.
Peter Leech
Partner at the Partnering Group
Leech heads the digital commerce practice at The Partnering Group (TPG), a management consulting firm that’s advised retailers and suppliers through its digital commerce practice for over 25 years.
What Becomes ‘Non-Essential’ in a Pandemic?
They are among the categories hardest hit by the economic slowdown, and while there are some well-known examples like restaurants, travel, and formal wear — others might not be so obvious. Consider a product like high-end earbuds: A particular segment of customers might usually buy these products online, but only after visiting a retail location for a hands-on experience. If so, these shoppers may wait to buy until it's safe enough for an anxiety-free trip to their local electronics outlet. All kinds of factors might contribute to these category-wide drops in demand: whether related to our newly socially-distant culture, cost, or other factors. "The thing we're trying to do is help our clients understand: 'What do I do about that?'" Leech said. "'How do I break down or categorize the drivers of what's causing damage to my ... non-essential categories?'"
Determine the Drive in the Demand Drop
Both Leech and Dooley recommend businesses split their low-demand, non-essential products into two categories: those not expected to recover in the short-term and others that might see a return — or even increase in sales — as pandemic conditions shift. Those in the former category should remain a low priority for now. Those in the latter category represent a serious opportunity for your business. Take the time to determine which factors influence your would-be customer’s reluctance to buy and make plans to best position yourself to convert them when their pent-up demand finally comes roaring to market. “Having an understanding of what is keeping the end-user from buying can open up some new opportunities for growth,” Leech said.
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Essential Questions to Prioritize Tweaks and Adjustments to the Basics
The pandemic slowdown is also an opportune moment to reconsider some of the most fundamental aspects of your customer experience, especially as it relates to rapidly increasing shifts in ecommerce activity. Leech and Dooley raise a few questions brand manufacturers should ask themselves.
Which sites are seeing traffic spikes? Are your marketers effectively leveraging shifts in shopper behavior and converting them to sales?
Could your customers benefit from a new approach? In a time when “non-essential” items are a lower priority for giant online retailers like Amazon, would an expansion into direct-to-consumer (D2C) channels or marketplace sales make sense for your business?
Is your content right for this moment? Are your brands striking the right chord, and in the right digital channels, to stand out on the digital shelf? “Some of the suppliers that have been hit the hardest are absolutely doubling-down on ecommerce,” Dooley said. “They wish they could have six months or a year ago, and they understand they need to now.”
Are Your Products Optimized for Digital Success?
Companies used to focusing on the traditional, brick-and-mortar experience often overlook the unique ways an online marketplace can enhance their brand and products. Peter Leech briefly discusses some ways brands can use digital spaces to add value for their customers.
‘Signal’ to Your Customers When It’s Safe to Shop
Whether your business has found success or hardship during these challenging times, “hygiene signaling” will become an important consideration as we move into a post-pandemic economy. Businesses will need to take concrete steps to make customers feel safe enough to interact with their brand as consumers hesitantly return to normal — an effort to reverse COVID-related demand shock. “We can do everything else perfectly, but if we can’t signal to people [that] it’s safe to shop and buy again, then nothing else will work,” Walker Smith said. “What we need to do is get our economy re-activated.” Brands have more power to make that happen than they might think. In fact, Walker Smith said after large-scale, disruptive events like COVID-19, customers are desperate for reassuring messaging. Much like the Transportation Security Administration (TSA) was created to assuage passengers’ security concerns after 9/11, brands today need to consider steps they can take to reassure customers’ fears about hygiene. “Is [the TSA] perfect? No. Is it inconvenient? Sure. But that’s not the point: It’s effective,” he said. “All of the security measures — both those with teeth and those that are more about security theater — provide clear signals to travelers that the environment is secure and safe. They can have confidence in going back to business as normal. We know that now, we need a signal of hygiene.”
Public Safety Over Sports
Nearly 3 out of 4 Americans said they won’t attend a sports game until a COVID-19 vaccine is developed.
Source: Seton Hall Sports Poll
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Step 2: Reconsider Your Audience
COVID-19 changed not only buying behavior but the ways people view themselves and their lives moving forward. Old market fragmentation models may no longer make sense in a post-pandemic world. Walker Smith encourages businesses to consider the ways these new attitudes will shape their customers’ perception of the world, and by extension, their brand. For example, rural customers might need very different “hygiene signals” than those living in highly-populated urban areas. Those working from home might have very different attitudes about the pandemic risks than those working in person. Make sure you’re speaking to customers in their new language — and find the right place, time, and occasion when you do so.
Step 3: Innovate With Hygiene at the Core
“Hygiene has never been the starting point for innovation when trying to deliver new products and services,” Walker Smith observed. “Now we need propositions that build hygiene in from the very start.” Brands that can become leaders in safe, hygienic shopping — and can effectively demonstrate this to their customers — will stand out from competitors who do not, and build trust with hygiene-conscious shoppers in the future.
Step 4: Partner in Unexpected Ways
During this crisis, virtually every brand faces the same challenge at the same time: an unusual dynamic that Walker Smith calls “the perfect time to do the unexpected.” He believes that collective “hygiene signals” across categories, rather than just from individual brands, will resonate strongest with customers, and drive overall demand back into your collective category. Consider partnering with competitors to create industry-wide best practices and welcome customers back into your shopping experience. “If Google and Apple can launch a partnership, the opportunity for new and unexpected partnerships is real,” Walker Smith said.
Step 1: Protect the Space
Businesses should manage the places and spaces where people directly interact with your brand, and work to limit your customers’ anxieties about their risk of exposure to COVID-19. Walker Smith points to supermarkets as early innovators in this approach, incorporating measures like shields, one-way aisles, and floor markings that are six feet apart. “But that’s just the beginning [for consideration],” he added. “What spaces cause anxiety for people these days that a brand could step in to relieve? What are the physical touchpoints, spaces, and surfaces that matter most to your customers, and what level of assurance do people need to step back into your category?”
Move Forward into the ‘Next Normal’
The COVID-19 pandemic has left a cloud of uncertain chaos in our lives. And while it has been a troubling, frustrating, and upsetting time, it's important to remember that it won't last forever. Despite it all, we still have a future — and "next normal" — worth planning for. Don't miss an opportunity to lean into its growth potential.
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Walker Smith identifies four essential steps in the Kantar Signaling Framework for businesses to incorporate hygienic innovations.
The Kantar Signaling Framework
