ADVERTISERS’ REACTION TO THE COVID-19 CRISIS

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Here is a small example of how we are living from Spain the situation of COVID 19, how it has affected consumers, the media, and agencies. We also offer some recommendations for advertisers and our perspective on what can await us once this global crisis has passed.

CONSUMER BEHAVIOUR

Governments try to contain the virus and this has undoubtedly affected significantly in the way consumers behave, passing quarantine in self-isolation..

As a result, people spend more time alone or in the company of their family members and housemates.

WHAT PEOPLE ARE DOING TO GET ON WITH THEIR DAILY LIVES

  • According to telecommuting figures worldwide, in Spain only 3% of companies apply telecommuting as company policy. The situation with COVID19 has caused this to change and many companies have an obligation to adapt to continue the work activity and do not stop production. For employees with children at home, companies provide facilities and become more flexible. Many companies have had to speed up their “digitization” process and test the capabilities of their tools to carry out this type of activity.
  • Homeschooling: Due to the closure of schools and educational institutions, many of these have made changes to their academic programs in order to teach classes virtually. This has been a remarkably interesting opportunity for online schools to boost their sales and growth.

ENTERTAINMENT ADJUSTS TO CHANGE

  • Digital media is the source of information: in these times of crisis the search for information and contact with our loved ones is an absolute priority for the vast majority. Real-time information sources, RRSS (mainly Twitter) keep the population up to date on what is happening in the country and the world. In Spain, the time of use of the mobile has been increased by 35% and 141% of notifications received.
  • OOTs are indispensable: platforms such as Netflix, HBO, Amazon Prime Video are central to people’s current entertainment. Reading and podcasts also help leisure within the home.
  • GAMES: in Spain there has been 4 billion games downloaded in February. According to a study by Sensor Tower (a company that analyzes app downloads), in February game downloads increased by 39% globally.

LEARNING OF THE H1N1 EPIDEMIC IN MEXICO 2009

What happened in 2009 with the Influenza pandemic can be replicated in 2020 with COVID 19

  • Certain industries such as cleaning and “pharma” grew exponentially during the crisis and even 10 years later continue to increase.
  • GDP fell by almost 1% (57 trillion pesos) due to business closure; mainly shopping malls, restaurants, cinemas, stadiums, etc.
  • According to Televisa, in 2009 with the emergence of the H1N1 virus there was an increase in audiences during the contingency period vs the regular period, for example on Channel 2 it was between 9% and 46% in various general programs for the adult target, and between 30% and 80% for newscasts on the same target.

WHAT BRANDS CAN DO

  • Avoid being seen as opportunistic: it’s an opportunity to live up to it. It is a time to demonstrate the values and responsibility of services with society.
  • Give support and encouragement: focus on messages where the human sense of the brand prevails
  • It helps to pass the time: be helpful and help people pass the time in a more fun, pleasant and bearable way.
  • Short-term, medium-term and long-term vision: Marketing plans are undergoing short-term changes, but it’s very important not to lose sight of the vision and goals we have in the long run.

HOW THE ADVERTISER POOL IS BEHAVING

Advertisers after seeing the impact of Coronavirus destabilize the work done and its Marketing plan, are preparing and readjusting their media strategy.

  • Open TV: at first there were cancellations, but campaigns and messages are currently being readjusted to reactivate. Although we have customers who are maintaining the activity, a significant investment reduction is expected this quarter
  • Pay TV: Some customers have decided to delay the guideline for the 2nd semester others directly cancel it. This medium will suffer consequences over time, even though its consumption during the crisis is booming.
  • Digital: together with open TV will be the least affected medium. This medium is enhanced due to its high consumption, most clients maintain the investment or even increase it.
  • OOH: out of home presence is one of the drastic decisions for all advertisers, many have slowed the presence in this medium or significantly decreased.
  • Radio: Customers who maintain investments in general also do so for this medium, although resetting communication and messages according to the current situation.
  • Magazine and Press: cancellations are taking place and commitments are barely being maintained.

BEHAVIOR BY CATEGORY

Consumption

Increased purchases in supermarkets and online stores due to provisioning, followed by products of indulgence after the first days: chocolates, sweets, sugary soft drinks, alcoholic beverages, olives, etc. With this in mind, here are the first reactions of our clients in the Consumer category:

  • So far, the investment in Open TV remains. Digital is increasing after deflecting budget from other media where cancellations are occurring (OOH, Cinema and Pay TV)
  • Message adjustments: Communication strategies are rethought by canceling some promotional campaigns and replacing them with others with consumer support/brand positioning messages.
ONLINE SALE

An increase in online shopping is expected by provisioning and leisure, consumers feel safer obtaining the products electronically and avoiding personal contact.

  • Investment in Open TV remains. Digital increases investment due to increased channel utilization by users and budget movement in other media.
  • Message adjustments, brand strategies are rethought by replacing campaigns that demonstrate support for citizens during the crisis period.

BEAUTY

  • So far, the investment in Open TV remains. Digital is increasing activity and traffic in applications, but not investment.
  • Cancellations are taking place in OOH, Cinema and Pay TV. The cuts also affect the Media Magazines where only commitments are maintained.
  • Promotion campaigns have been cancelled, replacing communication with messages of solidarity, while diverting production lines from some brands to manufacture personal hygiene items, such as hand sanitizer.
AUTOMOTIVE

The automotive sector will be one of the most affected in the short term. It is advisable to think ahead, and it is recommended to continue in the consumer’s mind without necessarily focusing on conversion into immediate sales. The behavior of the Advertiser Pool of this category is having the following reactions to the crisis:

  • Investment in open TV has declined in this category, others have canceled the guidelines this week in response to the situation.
  • Cancellation of film, press, and OOH guidelines. Communication focuses on Digital, which has declined investment, but remains a media with participation for the industry.
  • Message adjustments, focusing communication on messages of encouragement and emergency compression. Stay in the consumer’s mind, but not with the focus on sales.
CLEANING HYGIENE AND HEALTH
  • So far, the investment remains in Open TV, increased activity in Digital and deferral in print media and OOH.
  • Re-adjusting marketing strategies to products based on the current situation and rising sales of some products.
  • Cancellation of several promotional campaigns and others replacing messages with consumer support and branding.
  • This is one of the least affected categories, due to a massive consumer supply. Still, a reduction in ad spend is expected in the second quarter of the year.
FINANCE
  • So far, the investment in Open TV is maintained with an increase in activity in
  • Contractual commitments are maintained in other media, with cancellations in the film and OOH media.
  • Adjustment in communication strategies, going in two ways:
    • Support customers by deferring monthly payments, offering hospital insurance and even payroll advancement.
    • Reinforcement to online banking performing any operation without having to go to branches.
RETAIL

The category has been forced to implement drastic measures focusing its efforts on E-commerce channels. They have also implemented health protection measures for its workers and customers in physical stores that remain open.

  • Investment in open TV is maintained, while in Digital some advertisers increase it due to the budget movement of other media and the increase in online use.
  • They estimate budget cuts in out of home, print and film media, as well as an impact in the total 2020 investment.
  • Adaptation of campaigns with messages focused on promoting self-care and staying at home, fulfilling social responsibility
TRANSPORTATION AND DELIVERY

The Transportation sector, including home shipments, is estimated to be affected in the short term, although people will continue to order food at home during the crisis as long as it is allowed. It is advisable to think ahead and it is recommended to remain in the mind of the consumer during the crisis. The behavior of the category is having the following media reactions:

  • Investment in open TV has declined in this category, others have canceled the guidelines this week in response to the situation.
  • Cancellation of film, press and OOH guidelines. Communication focuses on Digital, which has declined investment, but remains a media with participation for the industry.
Technology
  • So far, the investment remains in Open TV, increased activity in Digital and deferral in print media and OOH.
  • Maintenance of several promotional campaigns and others replacing messages with consumer support and branding.
  • Keep in mind that customer contact is on all channels (web, networks, phones) is where there are short-term promotions and deliveries.

 

Crédito de Imagen: «Designed by Freepik»

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