An interview with Tim Beveridge, Director of Strategic Consulting for APAC and former Sky News Melbourne Bureau Chief and TickerTV host Ahron Young.
COVID-19 has forced huge changes to how consumers and marketers behave. Consumer spend has shifted, marketers spend has shifted, some categories have been decimated, others have had unprecedented growth.
Silverbullet’s Director of Strategic Consulting for APAC, Tim Beveridge, speaks to former Sky News Melbourne Bureau Chief and TickerTV host Ahron Young about what marketers should do to navigate these uncharted waters and how can data help secure marketers’ future.
Transcript of the broadcast:
Ahron Young, TickerTV:
COVID has forced huge changes to how consumers and marketers behave. Consumers’ and marketers' spending has shifted and some categories have even been completely decimated, while others have had unprecedented growth. We talk about a two-speed economy, if ever there was one we’re seeing it now.
Everyone is feeling a bit nervous about it, markets don’t like all this uncertainty. So how do marketers navigate these uncharted waters and what can be done to try to secure the future? Joining us live to discuss this is Silverbullet’s Director of Strategic Consulting for APAC, Tim Beveridge.
Tim: G’day Ahron how are you?
Ahron: I’m doing really well. Let’s talk about consumers and what’s happening out there at the moment, because as I say, it’s very much a two-speed economy right now.
Tim: Yeah, it sure is. Look, what we’re seeing right now is just a whole lot of consumer confusion and uncertainty. And as humans when we face confusion and uncertainty we tend to go to ground, we have a fight or flight reflex, so we expect the worst, we shut down, we get over-defensive and we think this situation is going to last forever. Essentially, we overreact because of that.
What I’ve seen with marketers is they’ve pulled back spending, they let workforces go, and that’s meant their suppliers have also had to let workforces go. So really, the challenge becomes one around marketing and the supply chain, and when things return to normal, and they will possibly in a few weeks towards normal at least, marketers and business will have to face a real challenge of rebooting that marketing supply chain, re-establishing it and getting that supply chain working again.
So the return to form for some businesses could conceivably take a lot longer than the lockdown has been around. So, obviously on the consumer side of things, we’ve got consumption and spend patterns changing markedly. Everything within the home has effectively boomed, everything outside the home has effectively struggled. Some pretty small and unexpected categories have seen enormous gains, I’ve been looking through all the reports and the largest gain I’ve seen, of all things, is 650% for bread makers, while others have had a sharp decline, apart from restaurants and events which have obviously had a significant decline.
Ahron: How much do you think will be up to marketers on the other side right now, many of the marketing campaigns we’ve seen before just don’t work right now obviously. We’re being told things will change, on the other side, you’ve spoken about bars and clubs, if you’re stuck at home the first thing you are going to be doing as soon as the lockdown is lifted is go out somewhere and meet your mates, so they’re probably not going to need much marketing are they, because it’s like Coles and Woolies, why would they ever do any marketing at the moment when they’ve got lines out the door they are trying to manage themselves. So how will things change in the near term?
Tim: Well, it’s interesting. You say there’s not much need for marketing at the moment but there’s always a need to build your brand in the minds of consumers, and capture the hearts and minds of an audience base.
If you look back though at historical studies, it’s organisations that increased their marketing spend through a recession or an economic crisis, they actually emerged out of that crisis better off. One of the examples that has been discussed a lot is Kelloggs versus Post, both cereal companies. During the Great Depression, Kelloggs doubled their marketing spend and their profit margin rose 30% and Post went out of business, so that’s a double win for them.
In the GFC, Virgin Atlantic increased their advertising spend and they got 10 times the ROI from the advertising they put to air in that period.
I think of it like: If you invest and double down on your advertising now, and you’re relevant to your audience and the way they are feeling now, you can emerge from this crisis like Luke Skywalker from the death star.
I think the reason for that is this: There’s a two for benefit happening at the moment. The first benefit is a media efficiency benefit. A lot of marketers have pulled out of the market and what’s that meant is media rates have dropped, what that means for marketers who can be in market is they have great media reach, frequency, and efficiency.
Ahron: Sure. Let’s talk about messaging at the moment. I know you mentioned Virgin Atlantic, but there’s no point in Virgin advertising right now because they are probably struggling to survive from one side and also you can’t fly. Obviously they could have a branding message and I get that point. The branding messages going into this from the TV networks that I think of is ‘we’re all in this together’.
But right now if one more person that I don't know tells me we’re all in this together, they are not going to have a very good reaction. So what do you think consumers want to be hearing right now from organisations, when we talk about they haven’t got a product which is available to buy right now for a lot of people or they can’t get the access they are so used to.
I saw a great marketing campaign from Colgate the other day, it was just on the TV, it was a whole bunch of people smiling on a Zoom chat gathering around and keeping in touch with grandma, and at the end it said ‘Colgate promoting Australian smiles for 50 years’. And I thought that was great. But we have been told in the world of marketing for years up until this point, that these good promos, these big ‘who we are’ promos, no one wants to hear those anymore, they want to hear more about the day to day stuff. Is now the time we do want to hear about the brand, as opposed to the product?
Tim: Look, I think we do. Marketing always needs to make the messaging relevant to what their potential customers are thinking and feeling at that time. I agree with you, most people are sick of hearing about COVID they want to think about other things. They want to get through this well, they want to be optimistic, they want to plan for the future, they want to take care of their family and friends and they want to connect with people and take care of their health.
There’s all these fundamentals of consumer or human existence that consumers want to continue to be involved in. So, I think it’s about pivoting your message, it’s not about ignoring COVID, you can’t pretend like COVID hasn’t happened, but probably it is not a great place to build a brand. The brand messaging and the messaging you use in market needs to shift away to something consumers find more relevant.
Ahron: So short term what do marketers need to do to make sure businesses emerge stronger than they went into this crisis, do you think it’s at all possible for some brands to actually benefit from this, like companies that have been publicly known to have been assisting people.
You think of Telstra trying to help emergency workers, you think of Bunnings opening their stores to emergency workers for an hour before everyone else, you think those sorts of things are part of the soft marketing push rather than a full on marketing push.
Tim: Yeah, absolutely, I think those kinds of strategies are great and really empathetic with the experience people are going through. Assuming you’re a communications-focussed marketer, and some aren’t communications-focussed, but if you are, I'd say there’s three key things you should do. The first is shift channels.
There’s no point in communicating in channels where your consumers aren’t. We’ve seen huge increases in online activity and consumption of streaming services, which is obvious, so I’d say shift your investment there. The second thing I’d say is actually increase your investment for the reasons I have given. I think it’s a great opportunity because of those media efficiency benefits, and also because of the digital nature of human behaviour right now, it’s a really great opportunity to start to learn, to test and to trial, and build your knowledge of your consumer base, either to create sales now or to create sales in the future.
Ahron: I’m interested in what you were talking about just now in shifting to where people are, and I totally agree with you, if people aren’t watching or consuming ads in the way they used to or marketing campaigns in the way they used to, head to things, you mentioned streaming of course. The big streamer is Netflix, there’s no ads on there. Are you talking about advertising on YouTube? We hear a lot of people talk about shifting ad spend to digital but what does actually mean right now?
Where are the places you should be spending your money, because it can be quite confusing for a lot of people, there are so many options, trying to think about what is right for me, who is my target market, how to get to those people. I think anyone who’s tried to do Facebook ads and target people and you’re watching the number on the right hand side go up and down about your target, it is so confusing, what are some tips you can give for business owners at the moment?
Tim: The confusion side of that is, if you need help, reach out. There are plenty of experts out there who can help you target audiences. I’d say you need to be on TV if you can afford it, you need to be on streaming services, catch up TV, those kinds of services, YouTube is a great channel to get involved in if you can, digital media, programmatic media, native content, those kinds of things, they are all key ways of reaching people now who are using the web and using streaming services more they ever have before.
Ahron: It’s a good point, the streaming ideas and getting on there. What do you think of advertising on YouTube?
Tim: I think it's really good, actually. Like any advertising channel it can be misused, but the same principles apply on YouTube as they apply anywhere else. That is, try to be empathetic to the viewer or consumer watching your content, try and respond to what they need, try and make content that is in some way valuable, entertaining, informative those kinds of things, a lot of the rules that apply to free to air TV can be applied to YouTube, but in a lot more cost-effective way.
Ahron: Really interesting point, appreciate your views, thanks so much for joining us.