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Trends Article May 2020

How and Where Brands can Advertise during Covid-19

Charlotte Malbasa, Client Development Manager, at Threefold comments on the latest news and trends within the world of retail.

Charlotte Malbasa Written by Charlotte Malbasa on 21 Feb, 2020

The impacts of Covid-19 are being felt in local communities and organisations around the world. And, there’s no doubt that its impacts will stick with us all in different ways in the future.

Faced with budget cuts, swift strategic development, a realignment on organisational priorities, and a new attitude, brand marketers are being pulled in a number of directions and are having to adjust any previous forecasts made at the beginning of the financial year. It’s stressful, it’s full-on and in some ways, it’s disheartening.

But, for brand marketers concerned about how to deliver their new targets, while delivering ROI on the remaining budget they do have, retaining or increasing strong investment levels in the right advertising can provide some answers.

Here’s what we know, in the U.K.:

  • -6.1% of companies reduced their total marketing budgets, swinging from a net balance of +4% in Q4 2019[1]. With less noise from brands, comes an opportunity to increase share of voice.
  • 45% of consumers are cutting back on spend and 47% have said they now have to be very careful of how they spend[2]. Brands need to stay top of mind and relevant for shoppers.
  • Social distancing has caused entertainment to boom with 49% of UK consumers watching more TV in March[3]. TV still presents an important media channel through which to reach shoppers.
  • Digital media is forecast to see the largest increase in time spent, with time spent up by 9.3%[4]. Like TV, digital media channels are proving to be a key way through which to reach shoppers.
  • Radio listening and streaming is significantly up with Global, owner of Capital FM and LBC noting that online radio listening has risen by 15%[5]. Sometimes overlooked in the media mix, radio is presenting a fresh alternative for brands.
  • 22.3% of all U.K. retail sales have been made online as delivery operations have continued[6]. Shoppers are purchasing via ecommerce more.
  • All UK supermarkets have experienced significant growth in sales in the four weeks leading to w/e 21st March, but Iceland saw the biggest growth (32.7%), subsequently followed by Waitrose (28.3%)[7]. Shoppers are actively engaging across all grocers.
  • Online grocery sales were up by 14%[8] during March, with two in ten households shopping online. This equates to 600,000 new households shopping online vs. last year, with an additional 1.2m online grocery orders placed. Retailers have a bigger online audience than they ever have done.
  • Alcohol focused stores saw a 31.4%[9] surge in sales volumes. The boom felt by some retailers isn’t bound to traditional grocery.
  • Email open rates have increased by 25% on average since the UK went into lockdown and have continued to increase each week[10]. Shoppers are still regularly engaging with brand and retailer communications.

Understanding that brand marketers are battling with budget cuts highlights that they are having to make bigger choices now, more than ever, about how to spend what they do have. With -6.1% of companies reducing their total marketing budgets, the value in media investment for those that don’t reduce their investment, becomes even more valuable.

While it may appear that the world has stopped amidst Covid-19…it hasn’t. The world and its many shoppers have just moved inside. Brand marketers now have an opportunity to utilise smarter communication methods with the information available to them. And, those who lead their planning by establishing where shoppers are and the channels their shoppers are consuming have an opportunity to be winners come the end of the crisis. Because, it will end. But those brands that utilise the opportunity we’ve found ourselves in to gain extra share of voice will only be better placed for future growth when the crisis eventually does end.

[1] Source: IPA Bellwether report Q1 2020

[2] Source: McKinsey & Company

[3] Source: Midia Research

[4] Source: eMarketer

[5] Source: Global

[6] Source: ONS

[7] Source: Nielson

[8] Source: Nielson

[9] Source: ONS

[10] Source: BounceX