Following Lockdown, we are dealing with distracted, doubtful but savvy consumers surrounded by uncertainty. This uncertainty can result in unintended consequences that can cause over-reaction on the part of consumers in areas that should not distract them. Moreover, it is obvious that ignoring their concerns can pose further problems.
For instance, see Tesco’s new Christmas advert. A 90-second commercial that contains an eight-second segment showing Santa using a Covid Passport to facilitate access to the UK has resulted in a 1,500-consumer backlash, where viewers took exception to the fact that Tesco seemed to be endorsing the use of Covid passports. Tesco’s response was problem-denial, making it inevitable that the advert would be referred to the Advertising Standards Authority. This represents a major distraction when the retailer might be better served managing one of the most demanding Christmas seasons in years. Especially when cutting the eight-second passport segment would eliminate the problem and still leave a very powerful Christmas advert…
It is also worth keeping in mind that, despite politicians’ claims to the contrary, the business and economic damage emerging from the pipeline has been caused by an 18-month Lockdown of the economy, rather than Covid… In addition, consumers are being subjected to a succession of ‘scares’ re Covid, climate- change and terrorism. As a result, we have super-savvy consumers coping with rapidly rising inflation, constant threats of a return to lockdown disruption, uncertainty re product availability, and job uncertainty.
Added to this is supplier and retailer uncertainty regarding where the attractions of online are heading. For instance, online’s current 12% share of grocery sales is possibly capable of reaching the 50% already achieved in other categories, with much of the online business in the hands of one supplier. All uncharted territory…
Added to this, NAMs are attempting to do the job in a fake-news environment, not knowing what to believe.
Others will eventually work out causes and purpose, we are here to explore the effects on business and means of solution in unprecedented times. In highly uncertain circumstances, the key for effective account management is to leave the search for probable causes to others, and focus on the results of lockdown and its impact on your job. Acceptance of this basic approach allows us to treat our issues as severe and unprecedented business problems, in need of treatment with our basic and favourite business tools as a means of optimising our brand certainties…
In fact, the key to stabilising a business in uncertain times is effective management of its brands and optimising its routes to the consumer. A well-managed brand can be a source of certainty in uncertain times. Keep in mind that during Lockdown we have seen consumers continuously turning to tried and true iconic brands in a search for stability and a basis for trust.
If our brand is going to successfully provide certainty amongst all the uncertainties, then it has to meet key criteria. Think back to why and how brands evolved. Before the advent of brands, people had to buy household basics with little guidance other than personal in-use experience of the category. Eventually, people began to realise that a reliable maker’s name could be a ‘guarantee’ of consistency, quality and value. This worked because the key to the brand model was repeat purchase. In other words, given the high cost of gaining initial purchase by a new user, the first sale is inevitably at a loss. If that customer is more than satisfied in terms of needs being met, there is a possibility they will return a second time, resulting in a breakeven sale with the third purchase by that consumer, and hopefully even providing a profit…
The ‘tell a friend’ mechanism then kicks in, and is in effect the best form of advertising and building trust in the brand. In other words, ‘please me and I tell one friend, disappoint me and ten friends will hear of my displeasure’. It is only by maintaining that trust with the regular user, always delivering more than it says on the tin, better than alternative providers, that brands became iconic…
Incidentally, in terms of pricing, while rivals may choose to risk alienating regular users by pretending to absorb ingredient cost increases via shrinkflation, we need to have the courage of our convictions and price our brand for what it is proven to be worth to regular users in terms of need satisfaction. Constant in-use monitoring of consumer satisfaction via repeat purchase is the only certainty that our business model is working.
All else is uncertain…
