202005.03
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Potential mistakes by brands during and post the pandemic

Aravind Thippanaik

As countries and companies limp back to normalcy, consumer companies will go into overdrive to gain back lost ground. Instinctively, brands will try to latch on to the “flavors of the season” – Health (Immunity), Safety (Protection/Hygiene), Hope (Better tomorrow). Brands may stretch across some of these dimensions irrespective of whether they have a right to play or not, pressured by top line and bottom line deliverable. In the long term, this may erode years of brand building and consumer loyalty.

Brand managers will need to keep a check and watch out for the Six Sins in Marketing that their brands may be subjected to:

  1. Sin of the Herd: Instinctively, brands may be tempted to stretch their portfolio across themes of immunity, hygiene and protection to create new brands or stretch existing ones into new categories. Brands should evaluate right-to-win based on relevance, believability and synergy with their existing business. Hasty moves may risk existing brands to lose distinctiveness and new brands to fail.

Taking the example of a leading paint brand that recently launched hand-sanitizers, it would be important that they access the “right to win” given that this new business would require a different route to market and channels to sell (chemists, modern retail, HORECA, etc.).

2) Sin of Over-Promise: The temptation to overstretch the brand promise may be higher than ever. For example, believability for existing brands who play in categories such as chocolates, snacks and noodles claiming immunity benefits may be far-fetched in comparison to brands with health and wellness credentials.

3) Sin of Slumber: The pandemic has resulted in consumers having to replace some of their regular brands with a different one. Newer and smaller brands have had an opportunity to get into the consumer’s baskets. Consequently, consumers may reevaluate their brand choices. It would be unwise to assume that consumer perception of popular brands has not changed. Brands should track the shifts in consumer perception to know where they stand today.

4) Sin of Myopia: Given the impending economic downturn consumers will be more value-conscious than before. It is important to understand the consumer’s perceived value for a brand across ingredients, packaging and quantity before driving cost improvements. Personal care, food and beverage companies will need to be cautious about gm/ml reduction given that brand loyalty may be fickle.

5) Sin of Sorrow: Consumers are looking to get back to a sense of normalcy. Communication leaning heavily on fear marketing may impact brand choices. In the new normal, consumers may perceive fear advertising akin to “opening up old wounds”. Positivity in messaging will continue to build brand love.

6) Sin of Illusion: The pandemic has brought about many knee-jerk consumption behaviors. There will be a temptation for companies to latch-on to these trends, some of which will be short-lived. Brands should evaluate the possible consumption behavior in the new normal, the “real size of the prize” and clearly define the area of play. For example, the demand for products like hand-sanitizers, veggie-washes may not be sustainable in the long term, considering easy access to soap and water at home.

While business agility is important, the fundamentals of understanding consumer behavior through research is more important now than ever. Although, this a trying time for the FMCG industry, it is also a great time for innovation. Consumption and behavior shifts will always create new opportunities and hence new businesses.

In my view (and these are not exhaustive), some interesting themes to explore could be:

  • Immunity (e.g. Vitamins and Supplements for senior-citizens, lung health, etc.)
  • Hygiene & Protection (e.g. “On-the-go” hygiene -products such as soap strips, sanitizer sprays, travel-minis, institutional hygiene solutions, etc.)
  • Home Convenience (e.g. home- hygiene solutions; Ready-to-cook products, cooking-aid solutions, etc.)

For small brands, big barriers such as – access to consumers, trust, brand loyalty, are breaking down fast in some of the categories. Small brands that survive the economic turbulence may well emerge as the strong challengers to the Goliath brands in the new world.

Aravind Thippanaik is an independent Marketing & Sales consultant, a senior expert on the panel of McKinsey & Company & a part-time Ceramic Sculptor.