Top 10 ways the coronavirus will impact brands and marketing in 2021

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Here’s what will make the difference between success and failure in a world forever changed by COVID-19.

The coronavirus pandemic has changed and rechanneled the marketplace. As we look ahead, there are new things that brands and marketers must watch out for. Kantar has been keeping a finger on the pulse of the marketplace. We’ve taken what we’ve learned in 2020 and built on it, identifying the ten things we believe will make the difference between success and failure in 2021.

Top 10 ways the coronavirus will impact brands and marketing in 2021 Brandspurng

Culling of competition and concentration within categories will escalate.

Situation: Big companies with solid balance sheets and affordable access to capital investment will pick off the growing number of ailing mid-cap and small-cap companies. Assortment simplification will favour the biggest brands. Consumers will look for more stability in the form of familiarity, convenience and routine.

Opportunity: Winning companies will prioritize brand scale, not a span of the portfolio, and will dedicate resources behind established brands with umbrella appeal.

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Next step: Discover the new pillars of growth to ensure the best fit of the business with the post-pandemic marketplace. Research on where to play and how to win.

Overhaul of high fixed-cost business models will accelerate.

Situation: Cash will continue to be king. Capital-light companies will survive and thrive while capital-intensive companies will struggle with cash flow and many will fail as government support dries up. Cost reduction actions will pick up, as will innovations in asset management and monetization.

Opportunity: Winning companies will get to the lowest cost base ASAP and then shift assets to a new business or reconstruct business models to leverage outside assets.

Next step: Reinventing how assets are managed, especially people, and relentlessly testing new business models. Tune-up or eliminate points of weakness. Begin ROI modelling of assets. And organizational retraining of skills.

Recovery will be steady but volatile.

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Situation: Essential products companies will become more essential as discretionary products and services companies become more discretionary. Different counties and even regions within countries will fare differently. The virus and lockdowns will continue to surge in rolling waves until vaccine implementation is finally completed.

Opportunity: Winning companies will move to localized and adaptive planning in order to align business with vaccine implementation and with business models less likely to be disrupted by lockdowns.

Next step: Adopt real-time planning that enables rapid resource and operating redeployment in specific geographies relative to rapidly changing market situations. Invest in contingency plans for future scenarios.

Out-of-home shifts to at-home solutions will grow and become permanent.

Situation: The acceleration of digital and virtual will recenter life on distance, delivery and decentralization. Work-from-home will leapfrog. Virtual will get a lot better. Consumers will resist giving up newfound time and control. Cost-savings and productivity will drive corporate decisions. Second-order effects will ripple out.

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Opportunity: Winning companies will immediately develop a detailed understanding of home-based needs, occasions and media.

Next step: Identify and quantify the value of at-home needs-gaps and potential offerings. Research to remap the structure of demand.

Nothing will be more critical than locking down loyalty.

Situation: Consumers are in flux. Everything about lifestyles has been upended, and new solutions are needed. Retail tactics like assortment simplification have untethered consumers from brands. The online surge is disrupting shopping habits. Many brands face the happy but unexpected challenge of retaining new buyers.

Opportunity: Winning companies will make retention a top priority, while also aggressively targeting consumers lost by competitors.

Next step: Ramp up the relevance and value of brand positioning and brand experience. Invest behind greater visibility and salience. Begin benchmarking research to ensure ‘meaningful difference.’

Antimicrobial protection will be the cardinal operating requirement for every company.

Situation: Health has become hygiene. Masks, distancing and handwashing are here to stay. Letdowns that alarm consumers about exposure will punish brands. Over time, many sceptics will be swayed, adding to the demand for signalling a safe hygiene perimeter beyond which people can get back to normal.

Opportunity: Winning companies will incorporate hygiene into the basic brand value proposition as well as innovate around hygiene solutions.

Next step: Make hygiene obvious and unmistakable, then build category-specific differentiation on top of that foundation. Brainstorm and test innovative hygiene solutions.

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Virus reverberations will make health an essential benefit in every category.

Situation: Every category has been impacted by protocols put in place to protect against infection. The takeaway for consumers is that every category, not just traditional health care, can help or hurt health. So every category can now plausibly treat health as a benefit. Big Tech companies are moving in this direction already.

Opportunity: Winning companies will move beyond old category boundaries in order to monetize innovative ways of ensuring and enhancing health and wellbeing.

Next step: Figure out a credible fit between health and the category that offers near-term brand opportunities Now is the time to refresh market structure research that incorporates health.

The integrity of commitment to the public goodwill matter even more.

Situation: Consumers want even more corporate involvement in the public sphere. The delicate balance of politics will become a regular challenge for brands. The competition for talent will keep pushing companies toward greater social purpose. The vaccine rollout will shine a brighter spotlight on the public impact of companies.

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Opportunity: Winning companies will do more than just sympathetic communications and find ways to more tightly knit purpose and product together in performance, convenience and experience.

Next step: Build a richer understanding of the rapidly changing cultural contexts that are setting expectations for the public role of brands. Deepen insights into trends, culture and lifestyles.

Rebuilding in sustainable ways will be non-discretionary.

Situation: Climate issues now have inexorable momentum. Unprecedented natural events and a shift at the top in U.S. politics will combine with growing protests and a generational handoff to a cohort with greater concerns. Investors are demanding better pricing of risks while also seeking sustainable innovations in which to invest.

Opportunity: Winning companies will build competitive advantage from sustainable practices, particularly in logistics, production, materials and energy.

Next step: Formulate a long-term transformation plan to put the entire business on a sustainable footing. Develop and benchmark a sustainable transformation plan.

US-China relations will improve yet continue to be unsettling for business planning.

Situation: Concerns about single-threaded supply chains and job losses from offshoring will continue to motivate policy. Both countries will keep shoring up domestic production and consumption. Pressures related to technology and IP will grow. Regional political issues will continue. Tensions will abate but not go away.

Opportunity: Winning companies will shift to localized systems and solutions that provide insulation from the ongoing uncertainty as globalization continues to unwind.

Next step: Strengthen both business infrastructure and brand positioning with local elements and sources. Prepare an innovation plan that maximizes returns on ‘local.’

Bonus: Disruptions are the new normal.

Situation: The pandemic has destabilized much of the marketplace and those impacts are still playing out. Other macro shifts like climate, AI, an ageing population, political unrest and even other pandemics lie ahead, along with many good things like space exploration, biomedical advances and green energy breakthroughs. Across many fronts, the future will be a series of disruptive step changes.

Opportunity: Winning companies will supplement planning based on extrapolation-based systems that presume high levels of continuity with scenario-based systems built to provide stability and control even in the face of high levels of uncertainty.

Next step: Build a scenarios-based planning system to augment and contextualize existing brand and annual planning processes. Create futures and trends program tied to business performance metrics.

Take action

A brand-building program in light of this ten 2021 watch-outs:

Develop scenarios: Work out a complete set of possible futures. Resolve how to plan against each. Invest behind best-guess, but also work out contingency plans.

Establish tracking metrics: Specify key benchmarks that directly track new dynamics and trends. Create a dashboard. Set up frequent review meetings.

Recast business strategy: Thoroughly reexamine brand fit and retail channels in light of shifts in demand structure. A new strategy is probably needed; at the very least, the strategy must be updated.

Renovate organizational capabilities: Complete assessment of skills and functional proficiency, and upgrade relative to business strategy.

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Top 10 ways the coronavirus will impact brands and marketing in 2021 - Brand SpurTop 10 ways the coronavirus will impact brands and marketing in 2021 - Brand Spur

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