The COVID-19 pandemic has had a tremendous impact on retail brands. Changes in consumer behaviour during this period will carry on for the rest of 2020 as online shopping and cloud services become trendier. For brand owners, adjustments of their e-commerce business models and transformations from offline to online are crucial.
From an AmCham webinar, Christine Wang (CEO of eCommerce & Performance Marketing at Publicis Groupe in China) shares the following action points for brands involved in e-commerce while still mired in pandemic anxiety.
Marketing in the COVID-19 crisis
This article is part of a special WARC Snapshot focused on enabling brand marketers to re-strategise amid the unprecedented disruption caused by the novel coronavirus outbreak.
1. Meet online demand for the major essentials and prep ahead for small quick-growth subsegments. Hygiene items, facial masks, detergent, handwash, infant formula, diapers, packaged foods and beverages, healthcare, insurance products, and education are the major categories. There are also quick-growth subsegments, which may not in the mainstream yet, for example, anti-ageing for youths, or vitamin E products. Even though these are smaller segments, they fulfil some consumers‘ unique needs. For new entrants from foreign players into such categories, this strategy will help to streamline market-entry budgets. Wang's recommendation is not to look for categories that guarantee sharp increases in usage, but those subsegments with niche audiences.
2. Consider more co-branding with multiple partners with similar target groups, as Centrum and Nescafe did in China. This not only gains web traffic for both brands, but also gains favour from consumers, as they are more practical during crises. Previous quantitative findings from Publicis proved consumers will weigh between what is necessary versus what is nice to have, especially the most vulnerable group of senior citizens. Centrum and Nescafe specifically designed a bundle for such senior citizens in China (see below). Needless to say, multi-vitamins and dairy products form basic nutrition to help boost the immune system to a certain extent. By joining efforts, both brands can communicate meaningfully to their existing consumers and also enlarge their target audiences in a mutually-beneficial way. In the same vein, shorten the number of clicks from e-commerce content to call to action during the pandemic.
3. Test different activation formats and meta-information to refine ads, as Mead Johnson did in China. The infant formula brand took this opportunity to test its target audience by segmenting it into different pools and analyse their reactions to different activations and ad formats on Toutiao. One was a message of protection because Chinese moms are concerned about the babies' safety; another was a practical message about not needing to go out of the home and yet have free delivery and an endless supply of milk powder. Its Toutiao campaign reached over 100 million impressions that led to 1.4 million clicks on Mead Johnson's e-commerce websites. This is a direct ROI (return on investment) of 3.9. Mead Johnson was bold to allocate a significant chunk of its budget to try Toutiao, a channel that was new for the brand, stated Wang, who recommended to also try increasing the interactivity of e-commerce ads to create post-pandemic demand scenarios and offline redemptions in the future.
4. Convert instantly with new customer recruitment offers and incorporate them immediately into the brand's CRM program, as Friso did in China. There are indications that most Chinese moms are worried about their babies running out of nutrition products, and new customer recruitment offers will increase the probability of direct conversions, particularly those moms who have switched from offline to online purchase channels out of necessity. Friso China registered new customers into its CRM program through e-commerce incentives (discount coupons). "This is very effective for the infant formula category, because if you have the consumer's information at the get go, you are able to remarket to them," she said.
5. Take advantage of the 'shopper-wanderers'. Before COVID-19, consumer behaviour on e-commerce platforms were more search-based; 40% of shoppers search for what they already want to buy and then check out information on available discounts. During the pandemic, consumers spend less energy on searching, and spend more time looking at what is new, what other consumers are buying, what are the recommendations from Alibaba's algorithms, what are the ratings and reviews of those related products, etc. They are who Publicis described as 'wandering around online shopping channels'.
6. Cultivate propensity to buy by 'hijacking' different touchpoints, including e-commerce search. Lenovo's offline stores had been greatly impacted during COVID-19 in China. In the meantime, the work-from-home (WFH) requirements meant many consumers are brand new who have never purchased office equipment, like laptops and printers, on e-commerce platforms before. Publicis needed to do a lot of lookalike modelling to determine which factors consumers are keener on. Speedy delivery in certain areas was more important to some, while technical specifications mattered more to others. Consumers are already searching for certain keywords, so in addition to the homescreen 'hijack' on JD (Lenovo's chosen e-commerce platform), the agency also 'hijacked' the search results to guide shoppers towards Lenovo's promotion pages. As a result, Lenovo successfully increased new user recruitment by 47%, ROI improved by 127% — more than doubled versus last year. The campaign (see below) contributed to 40% of Lenovo's GMV on its JD flagship store which, in Wang's words, was "extraordinarily high" as the average was around 20% to 25%. From JD's perspective, internal data shared with Publicis showed this campaign exceeded the benchmark by 24%.