Despite our collective experience from previous disruptions to the Building Product and Financing Channels, the panic and economic events associated with the coronavirus (COVID-19) is unlike anything we’ve witnessed. The International Air Transport Association says the virus outbreak that began in China could cost airlines as much as $113 billion in lost revenue due to the cancelation of international flights. And in Japan — which has been planning the 2020 Summer Olympics for nearly a decade — has already lost millions as a result of canceling some events and stands to risk more than $14 billion if the games are postponed. Certain cities in China and Italy, among the countries hardest hit by the virus, are under a complete lockdown.
Building Products rely on complex supply chains that often require international travel along with overseas transit of goods and materials. In addition to threatening supply, widespread fears like an epidemic can stymie demand… as cautious end-users simply can choose to keep their hands (and wallets) in their pockets. What’s more, social media can make it all too easy for negative or misleading information to spread like a virus and remain “contagious” for extended news cycles.
Learn Best Practice Marketing themes to help your Building Products Brands stay ahead of a wave of fear and negative sentiment by developing proactive, helpful and authoritative messaging:
Remind consumers that your products are safe
American psychologist Abraham Maslow’s hierarchy of needs is a universally accepted theory that prioritizes the most pressing human needs in a pyramid-shaped model. While this theory can be applied to interpersonal relationships and employment, the science is particularly relevant to Building Product purchases and business interactions.
At the very bottom of the pyramid are the most pressing human needs – the physiological. This includes important necessities like air, water, food and shelter. If your customer isn’t secure with these items… they won’t be in the state of mind to make other traditional purchases. Right above physiological needs, and before all others (e.g. does this product work, does it better the lives of myself and those around me), is the need for safety. If your branding hasn’t convinced end-users that your products are safe and/or environmentally friendly — all other messaging about how great they work, how fast they perform and how convenient they are — will fall on less-motivated ears. Especially for important, emerging target audience members… who will represent your future.
Strengthening your products’ sustainability messaging is a proactive way to combat negative viral messaging. Talking about your company’s commitment to reducing its carbon footprint, recycling the water used during manufacturing processes, minimizing your reliance on non-renewables, and decreasing the weight of packaging are all important ways to market your existing products, organically.
Demonstrating your commitment to sustainability is even better. Giving employees the day off to participate in a local park cleanup on Earth Day — and sharing the experience on social media — or highlighting a landmark made using recycled company byproducts are good ways to make your sustainability messaging tangible. Publishing life cycle assessments (LCAs), which monitor the environmental impact of products over their useful life, as well as health product declarations (HPDs) that offer detailed information on the makeup of products… are ways to transparently demonstrate a company’s commitment to human health and the environment.
Be the voice of reason
Companies who establish themselves as thought-leaders in times of crisis are often at the top of consumers’ minds when it comes time to make purchases. Every helpful piece of information demonstrating leadership on a topic or subject matter is a valuable deposit into the “Bank of Trust.” When the markets panic and consumer dollars are scarce, companies with large amounts of trust capital can make withdrawals… steering consumers in their direction and away from competitors. Examples include large manufacturers with long histories of safety practices that proactively share those best practices with the distributors and contractors who use their products. When distributors know that their supplier cares deeply about their crews making it home to their families every evening, they will be passionate advocates for your Building Products. Offering leadership commentary to trade publications to help not only your distributors and retailers – but also competitors – navigate their way through an industry-wide crisis is another way to raise all channel “boats” while also raising your company profile.
Crisis can be a highly motivational tool in helping companies rethink the way they do things. Before COVID-19 was affecting commerce worldwide, the 2003 SARS epidemic caused a similar panic throughout Asia. In China, nearly 800 people died and more than 8,000 people were infected by SARS. As with COVID-19, schools, factories, and shops were closed and some of China’s busiest cities turned into ghost towns.
SARS, however, contributed to the birth of e-commerce in China. At the time of the SARS outbreak, Richard Liu’s JD.com was a just a chain of a dozen small, offline electronics shops in the greater Beijing area. Due to SARS, many JD employees were forced to work from home. Richard Liu resorted to selling electronics on Internet forums and chat groups to keep his business afloat during the crisis. He later devoted the bulk of his resources to his online business, growing it to become China’s largest online retailer of electronic products.
Similarly, at the time of the SARS outbreak, Jack Ma’s Alibaba was primarily a business-to-business platform, connecting U.S. buyers with Chinese suppliers. A number of countries issued warnings for travel to China and, in response, many businesses started turning to Alibaba’s online business to secure Chinese goods. After shifting its focus to e-commerce in March 2003, Alibaba nearly quintupled its business compared to pre-SARS rates. Jack Ma turned tragedy into triumph and is now the richest man in China, valued at $42.4 billion.
Given the impact of COVID-19, what is your business doing to anticipate crisis or innovate around it?
Building Product Brands should look at this as an opportunity to explore different marketing approaches, evaluate supply chains and promote their company stories in better and more novel ways. Sometimes, crisis can be just the motivation a marketing-driven organziation needs to evolve.