By Doug Brooks, EVP at Ipsos MMA
In order to navigate their way through this crisis, executives across brands and countries are leveraging data-driven analytics to get ahead of the virus and “war-game” business options and outcomes. The outcome of this will enable them to chart courses to best reach consumers with the right timing and strategies to get their businesses back on track now and moving through the crisis. With cures and vaccines well into development by multiple pharma companies, while we don’t know the exact timing COVID-19 will end, in the grand scheme of things in all probability it will end sooner than later. Before it does, companies that realize it takes years to build a brand, more than likely won’t have been waiting in the wings for the crisis to fully abate before they act. When it does end it will be too late. We are seeing it now. The race to catch-up, regain share, accelerate growth and profit, gain competitive advantages has begun at many companies. They have moved out of the bunker and are working to find every tactic and strategy to mitigate the financial impact of COVID-19, setting themselves up for a strong run in the coming months, and importantly, positioning themselves over other brands who are staying too long in their bunkers.
While this crisis has lent itself to an unprecedented level of market volatility, it is a time to proactively step outside the fear many have been feeling and think differently about business drivers, engaging with consumers who are in a reactionary mode, and providing them with relevant goods and services in the most flexible and accessible manner. In times of crisis when traditional trends are disrupted, being able to use data and predictive analytics are essential to finding the right path forward. As the situation rapidly evolves, executives across industries and around the world need to be able to respond quickly, in an agile manner so as to simulate and optimize potential business outcomes. In the past two weeks, executives I’ve spoken with have a dramatically increased sense-of-urgency to move from worrying about the virus, which they have done the best they can to address, to understanding what can be done for the business, their people and the brand – now, next week, next month, the back-half… the next 5-years. Forward-thinking and looking executives are mining data and analytics now to unlock the right advantaging answers for the near and long-term.
Real-time “War-gaming” scenarios focus on two phases:
- Phase 1: During the period of disruption
With a focus on speed-to-action, results and flexibility, we use the data that has already been collected, harmonized and organized across marketing, operations and external factors, along with our benchmark database to develop a series of scenarios that focus on the following:How to optimize current/planned investments to manage cost and profit during the period of disruption?
- How to adjust plans, investments and targeting to influence and engage with existing and new customers in a flexible manner?
- How to balance brand vs. promotion investments during this period?
- What should be done to drive consumer engagement through ecommerce or owned channels during this period?
- How to improve geographic and customer targeting to find opportunities?
- How to keep loyal customers close during this period and increase their loyalty and potentially the size of their purchase?
- Phase 2: Getting back to growing
With a focus on accelerating growth and profit during the next 9-months of the year to offset the impact of disruption from COVID-19, the predictive statistical models will be enhanced and informed by new data and algorithms from the crisis period and earlier. This updated data will be combined with historical data sets and updated with category and crisis benchmarks spanning a combination of relevant industries. Local and global data, benchmarks and metrics will be applied to develop a series of scenarios that focus on the following:
- How much to invest and where to invest to “catch-up to our objectives” and accelerate growth and profit during the back half of the year?
- How to identify historical marketing inefficiencies that can be tapped to maximize the impact and value of the existing or already reduced marketing budget?
- How to take advantage of market opportunities (outpace competitors, share of voice, local targeting, consumer targeting, channel shifting)?
- How to manage during significant shifts in SOV, media inventory and the U.S. Election cycle?
- How have market and consumer dynamics impacted changes in the effectiveness of marketing and pricing actions?
- What will be the expected impact of each scenario?
While building, prioritizing and implementing “war-gaming” scenarios, there are important considerations.
- Agility and speed-to-decision/optimization combined with creativity will define brands today and have a lasting impact
Brand marketers with investments in sponsorships and sports marketing are now dealing with canceled or delayed events and closed arenas. With sales calls no longer allowed with physicians, commercial officers at pharmaceutical brands are facing the need to find new ways to communicate with doctors. Financial Services marketers are looking for creative ways to engage with consumers as the use of financial advisors and tellers is now limited. Auto manufacturers are pivoting to find new ways to sell and deliver vehicles in a safe manner. Restaurant chains are leaning heavily into online ordering and delivery services to survive. Being able to pivot quickly while deploying creative messaging, shifting consumer targeting and developing new and innovative approaches to servicing clients is critical. Marketers are using data and predictive analytics to support these new and innovative scenarios by understanding the minimum levels of media activity to support the brand, then reallocating budgets to support the new and emerging consumer engagement model in an efficient and effective manner.
- Quickly identifying and having response scenarios ready to go will provide competitive advantages as well as speed up recapturing sales and share
Effective use of data-driven response scenarios enables speed while managing risk. Marketers must build scenarios with various start dates, investment levels, market conditions, media inventory, shifts in media costs and competitive response. Having these scenarios ready to go enables brands to gain organizational, financial and agency account team alignment, so as the situation evolves, they are ready to implement within days and not weeks. Doing so requires Commercial Effectiveness Models or Holistic Marketing Mix Models that include marketing, sales, promotion, pricing, financial, operations and external factors. The inclusion of these factors enables marketers to simulate the impact of marketing budget, allocation and execution changes within the context of changing operating models, economic factors, competition, business seasonality and weather.
- Creating a playbook for marketers as they recover will provide first-mover advantages while enabling companies and brands to continuously evolve with additional market examples
We will learn from markets as they recover. This learning will guide refinements to response curves, media effectiveness benchmarks and optimal response scenarios and plans based on the shape of the recovery curve driven by consumer demand and economic recovery.
- Avoiding “analysis paralysis” has never been more important
Those who will say they can’t use data, analytics and research because it doesn’t represent this specific time period will potentially pay a significant price. Data-informed analytics can simulate for crisis situations and can yield more accurately predictive outcomes than more traditional, “gut-instinct” decision-making. Unlike five or ten years ago when analytics informed outcomes with a few megabytes or maybe gigs of data, many of today’s leading companies and executives apply dozens of terabytes on a monthly basis to enable them to achieve measurably better results. Data informed decision-making relies considerably less on vast “white spaces” of missing data and subjective analysis. Pond-like pools of data have formed great lakes. Those lakes are providing an ocean of real, measurable and actionable insights. Times like these will find that the proverbial “ostrich with its head in the sand” may not have a body when it starts to think about coming out. Leaders are combining data-informed analytics and informed benchmarks with good judgement and experience to translate insights into relevant plans that achieve business objectives in the recovery.