How has COVID-19 Impacted Our View of Companies?

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What Did We Learn About Companies?

Brands are certainly being judged by consumers for the messages that their advertising conveys since the outbreak of the coronavirus was named a worldwide pandemic. The first thing consumers noticed was whether a company responded or not. 

Brands do play an important part in responding to a crisis. And consumers expect brands to help address challenges. According to a study done by advertising perceptions, almost 90% of companies surveyed took action with their ad budgets in response to COVID-19. From the same survey, 55% of people thought that companies responded more effectively and quickly than the government. The second thing consumers judged brands on was on how they responded. Consumers noted which companies seemed to indicate they value people over profit and vice versa based on their actions and messages.

7 out of 10 surveyed around the world in a study done by Edelman, stated if they perceived a company was putting profit over people, they would lose trust in that brand forever. Consumers want brands and companies to acknowledge what's going on in the world, and respond with how they can help, protect, and empathize. Next, we'll look at examples of how specific companies responded and whether it was well-received or not. 

What Made Brands Win or Fail? 

Which brands won and which brands failed with how they responded to the Coronavirus outbreak? Companies seemed to win or lose in four key areas:

• Shifting 
• Sensitivity 
• Selling 
• Sacrifice 

Breweries started making hand sanitizers. Clothing brands started making masks. Brands changed their logo. And automakers started producing ventilators. There are mixed feelings on whether a company's ability to shift in the crisis is seen as self-serving or a helpful hand. On one hand, iconic brands like Coca-Cola and McDonald's in Brazil redesigning their logo to promote social distancing received negative reactions and was viewed as insincere and making light of a serious situation. On the other hand, brands taking action by shifting production was seen as getting in the fight. Whether a brand reacted with sensitivity or not was a major factor in whether they won in the eyes of consumers. Bolden, a British clothing retailer sent a message to its customers essentially saying, we know selling you clothes for which you have no need right now may seem insensitive, but the catalog was done, and we're not stopping it.  Here’s a reaction of one consumer to airlines messages of "we're in this together": 

A good example of a brand showing sensitivity is Facebook adding a care reaction to show support in the face of COVID-19. A company trying to sell in the current environment has to tread carefully as a record number of people are out of work. People are hard-pressed financially and a brand turning a crisis into a selling opportunity will be remembered.  Companies that are selling solutions and selling with empathy are doing it right. 77% of respondents in the Edelman study said they wanted brands to only speak about products in a way that shows they acknowledge the crisis and the impact on people's lives.

For example, an ad for beer displaying people on a beach having the time of their lives misses the mark. But a beer brand repurposing the names of sports teams such as "warriors" to describe health-care workers and first responders is along the right lines. A company making a sacrificial move for the benefit of others right now is applauded. Many hotels like The Four Seasons in New York, are offering rooms to front line medical workers. Carnival is offering its ships as makeshift hospitals. If a brand is helping at a cost or risk to themselves, it's viewed as stepping up in a big way. 

The question is will COVID-19 response or lack of, define brands forever? Simply put, yes. This will go down as a time everyone remembers. People may forget what a company did or said, but much like the famous quote by Maya Angelo, people will never forget how brands made them feel during this time.

How Does Marketing & Sales Change as a Result of COVID-19?

As we start returning to work, consumers want brands to step up, lead, and act in the best interest of people. Consumers don't want a hard sell focused primarily on price and promotion. They don't want anything overly gimmicky. People are looking for empathic messages and they want to be sold products and services that will help them meet today's challenges. 

We should expect a shift in consumer buying behavior from the ripple effect of COVID-19. E-commerce which has been growing rapidly before this crisis occurred, will continue to accelerate, as consumers who preferred in-store to online had to adjust their habits during stay-at-home orders. 

Before COVID-19, some consumers had been experimenting with grocery pick-up and home delivery, but now it will be more commonplace. Younger people were also exposed to stocking up on items and buying in bulk with the raid on toilet paper and hand sanitizer. 

People spent more time on devices and engaging in digital games, activities, and social media.  

A third of internet users age 16-64, plan to spend more time streaming shows and spending longer on social media after the outbreak ends. Companies will turn to these digital platforms for more marketing and sales opportunities. 

Although there are positive trends in e-commerce and digital engagement, some marketers are wary. 68% of respondents in a marketing week study, said they are expecting consumers to delay large purchase decisions. 

Spotlight on Businesses 

What have we learned through all this? Brands can make a difference. They have a role in reacting quickly to world events and providing information to educate consumers. Consumers are looking to companies to lead, some even more than the government. 

Companies should test the mood of the nation and adjust marketing and sales accordingly. People want messages of compassion and connection right now. Brands have the opportunity to deliver this, strengthening bonds and creating trust with consumers. Need help with getting your brand ready to go during the re-opening of your state? Contact Creatives On Call.

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Check out our other resources:

• What You Can Do with Zoom: Backgrounds, Branding, & Business Meetings

• Hiring Through Crisis: Recruiting & Onboarding in Challenging Times

• CARES Act Part 1: Your Guide to the Paycheck Protection Program

• Digital Marketing: What Does it Mean to be ADA Compliant?

• Coronavirus Disaster Loans Available to Small Businesses, Including Freelancers

• New Federal Law Provides Paid Sick Leave for Employees, Tax Credit for Freelancers