• Victoria Searl

Ready or Not?

It’s been 4 weeks since the rug was pulled from beneath an industry, already standing on very shaky ground.

I won’t add to the commentary around how restrictions might be lifted, but it’s clear that the businesses who make it through these next few weeks face a cocktail of challenges.

With homeworking likely to be the norm until a vaccine becomes widely available, meaning fewer people travelling into city centres; many brands will see their flagship sites under-punching for months or even years to come.

Habits have been changed and the reset button has been hit. A £4 coffee each morning might seem like an unnecessary luxury again as the financial implications of lockdown hit. And as people have reengaged with home and family, eating & drinking occasions which were previously automatically conducted in restaurants and pubs, might well have found their way home again.

And many consumers will question their choices. Whether that’s as a continued shift to shopping locally again, or being more conscious of the true value of their dining out experiences. People with less money, and a renewed view of what’s important, will be mindful how they spend their cash too.

But amidst these changing circumstances, when restrictions lift, recovery and even growth is possible. But the size and as yet unknown nature of the challenge ahead means we need to forget much of what went before. Here are 5 things you need to be doing now.

1. Be visible. Even some of the big brands have pulled the plug on their social media presumably to (understandably) save money, but it’s absolutely essential your brand stays front of mind. We’ve somehow forgotten this in our obsession with ‘like for likes’, but marketing is as much about long-term emotional connection and influencing future behaviour as it is about driving people through the door today. You may have nothing physical to sell at the moment, but use your brand’s unique tone of voice to maintain engagement.

The brands who are finding authentically creative ways to stay part of the conversation now, will be the first places on people’s minds to seek out when restrictions start to lift. The quietest brands may well not get on the list.

And don’t just rely on social, focus on your local SEO strategy NOW, because SEO can take weeks and months to translate customer interest into covers. As Matt Goodfield, CEO at SideDish Media says; “With the cost of SEO being at an all-time low, now is the perfect time to invest and plan, to make sure you reap the rewards and hit the ground running once the market starts to re-open”.

2. Start taking marketing seriously. I’ve frequently spoken of marketing’s frustrating lack of credibility within hospitality. Consistently poorly understood and utilised, it’s not surprising it’s the function most likely to be driven by stakeholder subjectivity, rather than hard fact.

From the very largest businesses to the very smallest, marketing is driven by gut instinct and subjectivity more than any other function. But the time for non-marketers ‘dipping their toe in’ or having a go at marketing as light relief after a hard day of whatever the day job is has to be behind us now.

Your marketing team must be given clarity of your business’s immediate commercial goals, the space to plan their response to that challenge, and then to be held accountable for delivering or evolving it. That is simply not possible when marketers are not given complete and consistent ownership of their function.

3. Get some strategic advice. Mark Ritson (Professor of Marketing and regular columnist in Marketing Week) stated last week that the best marketers will be upping spend not cutting it.

Now, while we might feel that’s all very well for sectors which rely less heavily on physical footfall, like retail; spending the right amount of money in the right places now could ensure we in hospitality bounce back faster and stronger than had we not.

However, investing increasingly precious cash, can only be done confidently by those with the experience, vision and insight to navigate and mitigate the risks.

In their 2010 article in the Harvard Business Review, Roaring Out of the Recession, Ranjay Gulati, Nitin Nohria and Franz Wohlgezogen noted that only 9% of the 4,700 companies they analysed managed to emerge from a recession in better shape than when they entered it. And one of the key hallmarks of these successful firms was a “Janus-faced” ability to cut budgets in some areas while continuing to invest in marketing and advertising.

If you don’t have a deeply skilled senior marketer with a strong understanding of digital and data-led marketing, it’s not sensible, or fair, to expect them to confidently and decisively come up with the recovery strategy which could make or break your business.

Even 1 day a month from a qualified consultant will make a massive difference to your team’s effectiveness and your ability to drive the acquisition of new or lapsed customers, convert the ones you have to spend or visit more, and retain them long-term.

Ines Llerena, director of Pearson Ham the sector pricing specialists argues; “pricing and promotional activities, will be more important post Covid-19 than ever before. Lower disposable income combined with pent-up demand will require brands to re-think the pricing strategy. This is not the time to increase discount activity nor the time to aggressively increase prices to offset costs. Brands will need to identify optimal price points and promotional activity that boost demand whilst protecting brand’s profitability. It is essential to understand customers changing behaviours, how the brand can meet those new behaviours and how it impacts the brand’s value equation. In previous crisis, like the dot com bust and 2008 financial crisis, brands that re-visited their pricing strategy and focused on price & promotion optimisation had a successful recovery post crisis.”

There is money to be made, and share to be stolen, but you and your investors must have the confidence in the marketing decisions your business is making.

4. Get your data in order – and use it. It’s fair to say many hospitality brands were in a precarious position way before the shattering blow of Covid-19. Whether forced there by changes in customer dining habits, disappointing operational delivery, unsustainable rent, rates & general operating expenses, the boom in delivery, indistinguishable brand & marketing or simple market saturation; the sector was becoming increasingly unviable.

We know pre-corona, the government had a huge part to play in creating a viable trading environment; but if we’re honest, many of us have consistently ignored some of the answers to the fundamental question of how to drive sales and profit.

We’ve bought sophisticated systems and platforms, then chosen to disregard the intelligence they bring to decision making.

CRM systems, some of which, when used well, can identify your most valuable customers in terms of frequency, recency and even spend, and tell you how to engage with these golden prospects with the least amount of promotional spend, have been used to indiscriminately blast messaging, however irrelevant or unwanted. Often because at board level we prize bold actions and big numbers ahead of targeted marketing - which won’t impress anyone with the size of it’s reach, but would deliver significantly higher returns both in the short and long term.

Much of this ‘volume’ marketing, which actually serves to erode customer engagement, and destroy conversion, could easily be replaced, or at the very least, enhanced, by data-led marketing which hits the target and consistently delivers its objective. And in many cases, you already have the data and tools to action it with your own businesses.

40% of leaders in the coffee sector told a recent Allegra World Coffee Portal study, that consumer data was the greatest benefit of coffee shop’s loyalty apps, with it being cited as one of the reasons the outlook for UK coffee shops remain bright, despite the current health and impending financial crisis. But data and technology is useless, unless you’re prepared to understand and action it.

Organise and use your data wisely to increase your reach and chances of conversion on social, or test new (to hospitality anyway) technologies like programmatic advertising, which has shown some incredible returns in other physical footfall dependant sectors; like furniture retailers.

And data doesn’t only (only!) translate to sales, profit and loyalty. By using the data found in some of your WIFI and CRM systems, you can get a clear picture of your performance in the context of reduced, changed, or inconsistent footfall too.

5. Be flexible. We’ve often got a very strong perception of our brands and how people interact with them. But given that few of us have much in common with many of our target audience, and even the newest brands like Dishoom were born before the dawn of Instagram, it’s likely we’re not as close to our audiences as we’d like to think; and that was before the nation went through the biggest behavioral and emotional shift for a generation.

As an industry we may still be in our relative infancy, but the brands with longevity, who triumph through war, major cultural change and recession, like Twinings (founded in 1706), Lloyds Banking Group (founded 1765) and Boots (1849), survive in part, because of their ability and commitment to adapting to significant change.

While many of the things we say we’ll do now (I’m going to spend less time on packed tubes and more time working from home and drinking tea from a teapot), will fade, this experience in some ways, has changed us forever.

Use your data, insight and external expertise, to give you clarity; and the available technology to allow you to respond to whatever the ‘new normal’ is at any given point; as fast as you can.

My very best wishes to you all.




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