Model modifications that had been already in movement a yr in the past won’t speed up till 2021
There are many words that could be used to describe 2020 – one is “unprecedented”; "Pandemic" is an obvious choice. However, if you're a brand, the word that best sums up the year is "Pivot."
Pivoting is exactly what brands big and small had to do as of March. The marketing community agreed on the need for quick adjustments and overhauls. It was an impressive accomplishment because the world of brands is huge and includes companies that make the products we desperately need in times of crisis – ahem, toilet paper – and those we definitely don't, as much as we like them (See you at, $ 1,000 handbags).
All brands seemed to recognize that the steadily emerging trends on the horizon were much closer than expected. CMOs started the year with a consumer focus – creating more personalized experiences for them, giving them a variety of ways to access their brands, and advocating for causes and issues they believe in. The events of 2020 did not change these priorities, but made them priority.
"A lot of brands talked about being incredibly customer-centric," says Jared Fink, Group Director, Siegel + Gale Experience. "(In 2020) that was put to the test."
Where we are now
Brands offer services we barely used before the pandemic – how many weddings were held on Zoom before 2020? – as well as those that feel like something from another life. (It hasn't been a great year for transatlantic sales.)
The events of 2020 brought to the fore how different the positioning of these different sectors actually is – and what pivots they therefore had to set. Companies like Lysol and Clorox soared in 2020 thanks to unprecedented demand for their products, forcing them to ramp up production. This, in turn, allowed them to increase the ad budget, which Clorox did three times in 2020, including a 30% increase in the final quarter of the year.
Other 2020 success stories, like Zoom, which saw its mobile app downloads increase 728% from March to April, also made more money in advertising. Zoom made $ 100.9 million available in the fourth quarter of 2020, up $ 45 million year over year.
But the chaos of the pandemic resulted in more unhappiness than positivity. Travel brands are the best-known example as demand and sales are falling off a cliff. This affected their ad spend: very few airlines ran TV ads in 2020, with the exception of Southwest, which was often the only airline advert on TV. Retail outside of giants like Amazon, Target and Walmart was also hit hard. 38 retailers and restaurants filed for bankruptcy, including J.Crew, Neiman Marcus and JCPenney, compared to just 19 in 2019.
Where do we go
In 2021, brands will double their bets in 2020 and introduce new loyalty programs like Walmart +. Introducing new methods of getting goods into the hands of consumers, such as roadside collection or the introduction of new direct-to-consumer channels; and new advertising platforms such as TikTok or TV for some brands (1,200 DTC brands switched to TV advertising for the first time in 2020, according to iSpot.tv).
And even in a future world where we meet more face-to-face, the move to digital will continue. IBM's U.S. Retail Index reports that the pandemic sped the transition from physical stores to e-commerce by five years. This shift is set to continue in 2021 as brands pursue tactics like live streaming in stores, which has already made waves in China, and shopping on social media platforms thanks to the 2020 debut of Instagram and Facebook stores.