I’ve spent a lot of time this week checking in on my clients and colleagues – hours spent in Zoom and on phone calls. Pretty much all anyone can talk about is COVID-19 and what it’s likely to mean for their company.
Naturally, the news isn’t great, and whatever you think of the various measures that have been put in place around the world, it’s clear that the economic impact of shutdowns and self-isolation will be significant. But that doesn’t have to mean that it’s all doom and gloom.
As I’ve talked to dozens of people over the last few days, I’ve identified several ways in which people are responding to the crisis.
Some companies that haven’t taken the COVID-19 threat seriously until this week, have only one or two revenue streams, and rely on public gatherings and events for turnover have been blindsided.
These folks are panicking as income drops sharply and fixed costs remain stable. They haven’t made preparations and don’t have strategies in place to replace revenue and reduce costs. Blindsided companies are not a happy place to be just now.
I’ve spoken to leaders this week, mainly in the FMCG and F&B sectors who are fearful. On the whole, their supplies haven’t yet been disrupted and customer demand is still strong, but they are worried about what’s coming next.
One thing that struck me about the The Fearful is that some have allowed their fear to cloud their thinking and paralyse their decision-making. Instead of trying to counter a drop-off in demand in the traditional channels, they’re just bunkering down, cutting costs and taking a ‘wait and see’ approach.
While I’m a big fan of cost control, there are real risks associated with going into survival mode. You lose momentum and that can make it hard to maintain rhythm within the team, which can affect profitablility, even in good times.
It’s a little like jungle warfare. When the enemy is after you, can either come up with a strategy to counter-attack, or you can dig a hole, cover yourself up and hope they don’t find you. Although it’s scarier, I personally prefer the counter-attack approach to the “run and hide” approach, because it gives you the opportunity to take back control of the situation.
Then there are The Prepared. These guys saw the crisis coming six weeks ago and they’ve been smart about it. I talked to the owner of a fashion house this morning who has requested rent holidays on retail premises, put aside savings from factories, pivoted his company’s online strategy and taken measures with his bank to ensure that he has enough funds to weather tough conditions for months to come. This company hasn’t yet seen a drop in retail sales, but they’re ready if it comes. They’ve also come up with thematic marketing campaigns, encouraging people to shop online, even if they aren’t going out and about.
The Strategists are my favourite category in this bunch. They acknowledge that there is a crisis on the way, but rather than let it freak them out, they approach it as an opportunity rather than a threat.
I ran a workshop for clients yesterday whose main form of marketing is trade shows. They’ve had to cancel all their plans to exhibit at shows across the globe … and to be frank, I was holding my breath hoping that they weren’t going to tell me that no shows spelt disaster for the brand.
But these guys have the right mindset. Together we identified the cancellation of trade shows as an opportunity to rework their entire marketing strategy and develop a targeted digital plan – something they’ve been meaning to tackle for a long time and have never gotten around to, because they’re always travelling. With six exhibitions off the table and $250,000 that would have been spent on exhibiting in the bank, this company has more than enough resources to put together a kick-ass digital strategy that, if done right will let them reach many more people than they could ever hope to reach at trade shows. They’ve also identified an opportunity to acquire a competitor, opening the door to increased market share and a big revenue jump over the next 12 months.
Another company I’m working with has an Internet of Things device that records temperature. To date it’s been used to track temperatures inside refrigerated units, but the founders have spotted an opportunity to pivot the application of the device so that it monitors the temperatures of human beings in public places – something that is hugely relevant just now.
Purveyors of wine online, masks, hand sanitiser and loo paper comprise some of The Jubilant – these companies are raking in it as people panic buy and stock up on essentials for a possible stint in self-isolation. While that’s going on, I’m hoping The Jubilant also remember to plan for the calm after the storm, when people realise that they bought waaaay to much toilet paper and won’t need to shop for it again until 2024.
Which type of company are you? How are you dealing with the global health crisis?