May 7, 2020: By: Michael Stone, Chairman and Co-founder of Beanstalk

Recent research reveals that how brands act today, during the pandemic, will have an effect on consumer loyalty and purchasing behavior when we are in a post-pandemic world.  Yet there is an opposing viewpoint:  the market has a short memory and actions by brands today won’t make a difference tomorrow.  But brands matter and the coronavirus pandemic is revealing just how strong brand equity really is.  Who ever thought that finding a 12-pack of Charmin or a six-pack of Bounty at the local supermarket would feel like winning the lottery?  Although one could also argue that consumers are learning that paper towels are just paper towels and, accordingly, brand equity has actually been eroded during the pandemic.  Although we won’t know the outcome of this debate for some time, marketers should pay attention -  what brands do today during the pandemic (and, indeed, post-pandemic), what they say and how they act, how they serve their stakeholders and the public good, could very well have consequences for them long after we are all vaccinated. 

Where we were.   Just as we thought we were getting a handle on the new marketing ecosystem, the coronavirus pandemic has thrown brand marketing into a new, confusing and uncertain landscape. Let me step slightly back before getting to where we are right now.  The marketing environment changed so radically in recent years that a school of thought evolved that brands were in decline.  Certainly, the internet and everything associated with it diminished the effectiveness of traditional advertising and complicated how brands engage with consumers and drive loyalty.  The purpose of brands has always been about assuring us of the quality of a product and to make our buying decisions easier.  Consumers want to feel safe in their buying decisions and they came to trust brands.  The Internet and technology, however, turned everything on its head and the monopoly that advertising had in delivering brand messages fell apart.  Now, with a click, consumers can obtain all of the information they could possibly want about any product from experts, influencers and from each other, among other sources.

Yet, a cultural paradox emerged.  Yes, information that we used to rely on advertising to give us about brands and products is now readily available on the internet (so we need brands less).  But also, yes, we want help making our buying decisions (brands give us that help), and we seem to have even less time to make those decisions than we used to.  We still want speed and ease for our buying decisions.  We need brands less (maybe) because we can research little known or unknown “brands”, and we need brands more (maybe) because we don’t have time, suffer from information overload, and want to be able to trust our purchase decisions. Ultimately, it depends on how brands choose to deliver their brand message to us. 

Where we are.  For many years. marketers have spoken about “engaging” consumers.  But that was always a one-way street:  the brand reaching out to the consumer in an effort to attach the consumer to the brand.  However, brand messaging is no longer a one-way street but a two-way street, brand to consumer and consumer to brand.  It’s about “entangling” brand and consumer, building a mutual, enduring, interrelated connection.  (See, “Release the Power of Entangled Marketing: Moving Beyond Engagement” by Stan Rapp and Sebastian Jespersen, The International Press, 2016).  Today, the coronavirus pandemic is reinforcing how entangled brand and consumer have become and it is revealing it in powerful ways.

As noted earlier, we trust brands.  But perhaps even more significantly, how brands are treating the pandemic is important to many consumers and may have a lasting impact on consumer loyalty and entanglement.  And this is where things get interesting.  For the past several years, it has become clear that consumers (Millennials and Gen Z, in particular) want brands to stand for something, have a purpose, take a position about social, environmental and political issues of the day and purpose-driven marketing strategies were, as a result, gaining in importance.  Consumers already had made it clear that they don’t want just a lot of talk and messaging, consumers expect brands to take action.  In response, brands have increasingly taken public positions on and actions related to sustainability, gun violence, and sexual harassment, among other important issues.  And now, in the midst of a pandemic, with our federal government seemingly not up to the health, social, political and existential challenges we are facing, consumers’ expectations that brands step up and play an active role in meeting those challenges has accelerated and gained a new importance.  Consumers are very sensitive right now and actions, as always, need to be aligned with a brand’s core values, but the health crisis allows companies to step into the breech and, in a way, redefine who they are.  Brands can serve not just consumers but society in general and even fill the gaps left by institutions.  Meeting this challenge, working in the public good, can have lasting consequences.  And let’s not be too cynical, although brands have their eye on the future (and consumers’ new expectations), altruistic motives flourish as well.  Although corporations are not people, as then-Presidential candidate Mitt Romney once remarked, they are run by people, people who care.

Brands respond.  Many companies have taken actions for the public good in multiple areas that deserve to be applauded.  Companies have switched their manufacturing to PPE and other medical and health equipment and supplies in this time of extreme shortages.  While getting PPE for its restaurant staff, McDonald’s was able to obtain more masks and donated one million N-95 masks to Chicago and the State of Illinois.  Leading toy manufacturers Mattel and Hasbro are manufacturing face masks for healthcare workers (in the case of Mattel, from fabric normally used for Barbie and Fisher-Price).  Over a dozen P&G locations around the world are producing face masks for donation. Unilever donated 200,000 masks in New Jersey as part of a larger global donation of $100 million in goods.  Ford, 3M, GE, Dyson and Rolls Royce have pivoted to making ventilators and Apple is designing face shields. Many designers, apparel manufacturers and retailers have also switched production to masks and gowns including Ralph Lauren, Gucci, Zara, H&M, Canada Goose, Brooks Brothers, Hanes, Fruit of the Loom and Under Armour, while Fanatics and MLB have partnered to produce masks and gowns from on-field jersey fabric.  Companies stepping up production of hand sanitizer or sanitizer ingredients include P&G, Anheuser-Busch, Diageo, Coty and LVMH (which is using its perfume production capacity).  Nordstrom, the largest employer of tailors in the country, is now using that workforce to make masks for its employees as well as healthcare providers. 

Many companies are striving to serve first responders with not only PPE but with food and other necessities.  Sweetgreens is delivering meals to healthcare workers and Domino’s, Chipotle and KFC have given away pizza, burritos and chicken, respectively, to hospitals, medical workers, and grocery workers.  Popeyes has a new menu item and merchandise with proceeds going to a local food bank in New Orleans.  Companies such as McDonald’s, Starbucks and Krispy Kreme are offering free food at their locations to first responders. Crocs is donating shoes to healthcare workers, Uber is offering free food deliveries for medical providers and Dollar General is offering discounts.  And hotels such as Marriott, Hilton and Red Roof Inn near hospitals are opening up rooms for healthcare workers.

With so many people out of work and children who rely on school for meals, the United States is witnessing a shocking display of citizens who can’t put food on the table, and companies are taking action.  KFC is donating money to help provide food for kids and many of its locations are donating food to local food banks.  WW (formerly Weight Watchers) is providing money for meals to organizations serving those in need (and allowing WW members to donate their points for the effort).  Other companies donating money for food or donating food include JanSport, Danone and Kraft Heinz.

Research also shows that how companies are treating their employees during this period impacts a brand’s favorability. A study by leading survey research firm Morning Consult, entitled “Weathering the Storm: Brand Management in the COVID-19 Era”, found that 90% of respondents say it’s important to them how brands treat their employees during difficult times.  And, indeed, many companies are providing extra hourly pay, special paid sick leave for at risk employees, child care, outright grants or bonuses for employees facing extreme hardship, and continuing compensation although the business is closed (e.g., Target, Walmart, Starbucks, Lululemon, Kroger, Dollar General and Camping World, among others).

And the list goes on with companies and brands supporting bartenders (e.g., Diageo, Jameson), the availability of grocery items (e.g., Panera, Patagonia), community shopping assistance (e.g., Walmart), social distancing (e.g., P&G), free services for struggling small businesses (e.g., EBay, Google, Facebook, Neighborhood Goods) and free services for those in need (e.g., free Zoom for schools K-12 and easier access through AT&T), pandemic-specific content for children (e.g., Sesame Workshop, Nickelodeon, Cartoon Network and LEGO), redirecting marketing budgets to relief efforts (e.g., The Coca-Cola Company) and, of course, contributions of large sums of money and relevant products for organizations focused on the consequences of the pandemic (e.g., Amazon, the NFL, Nike, Mattel, among many others).  And Zappos, famous for its customer service, now has a Help line open 24/7 for people to call with questions about anything, without a purchase.

The data.  Let’s look at some of the recent data which is coming out in real time. The recent 2020 Edelman Trust Barometer, based on interviews with 12,000 people in several countries, conclded that consumers believe that brands have an important role to play with respect to the pandemic.  (See, Trust Barometer Special Report: Brand Trust and the Coronavirus Pandemic, Edelman, March 2020).  The Edelman Report found that consumers expect brands to protect the financial security of employees and suppliers, provide reliable information about COVID-19, and be creative and compassionate in the way that they take action with respect to COVID-19.  Seventy-one percent said that if during this time “they perceive a brand is putting profit over people, they will lose trust in that brand forever.”  In particular, the Edelman study found that 61% of U.S. respondents noted that how a brand acts during this time will affect whether or not they continue to purchase that brand in the future.  That means that brands have an opportunity to further entangle with consumers during this time, but it also means that consumers can easily move to another brand that they see is doing more. 

Some similar conclusions have been noted by the Morning Consult study:,  “As we face a new world order where trust, community support, societal contributions, and even potentially painful sacrifices take greater precedence in driving consumer choices, the balance is shifting to stronger, more human relationships founded on brands showing up in new ways for new consumer needs during unprecedented times.”

In the midst of this crises, the intersection of brand trust and consumer expectations is where companies today can make a difference.  The Morning Consult study supports the notion that brands that act “…in service of a broader set of stakeholders stand to gain more than affinity when consumers return to full spending potential - - they will have earned invaluable trust and in turn, purchase preference.”  The Report concludes that the “pains brands are experiencing and sacrifices they’re making are not going unnoticed - - quite the contrary, in fact.” 

The Edelman report notes that 65% of respondents said that the way a company acted during the crises would have an impact on the likelihood of them buying its product in the future.  And 37% claimed to have switched brands or used a new brand as a result of the way it responded to the pandemic.  It’s also clear that some consumer behaviors/expectations have likely changed for the long term.  Hotel chains are already planning for the post-pandemic period when consumers will be more attuned to sanitary conditions in hotel rooms.  Hilton, for example, has teamed up with the Mayo Clinic and Reckitt Benckiser Group, maker of household cleaning products, to pursue new cleaning protocols in its rooms.  Marriott International and Airbnb are also moving in that direction. 

The future.  And, yet, the question remains:  Will consumers remember how brands acted during the pandemic or will they forget and simply return to their pre-pandemic purchasing habits and loyalties?   Some brand experts are saying just that: 

“The fact is that people have a lot more to worry about in their lives than what brands and companies are up to.  If you ask them, then of course they will say it matters.  But are they really thinking about that right now when they’re worried about their own jobs and whether they can feed their families?”  Craig Mawdsley, joint chief strategy officer at AMV BBDO.

“…how long is the collective consumer memory and will the consumer attitudes we’re seeing towards certain brands right now have any bearing at all on the success of those businesses when we get back to something resembling the previous social and economic conditions we were enjoying before the virus hit us?  I think it’s a case-by-case basis, but on the whole, I honestly think that the market has short memories.”  Rob Sellers, chief growth officer at Grey London.

It’s a fair debate.  Nevertheless, it’s clear that consumers want to know how brands are helping to protect them and society at large and what kind of solutions they are offering in this time of crises.  It’s too soon to know if there will be lasting value for brands that take meaningful action today or rise to the challenge and demonstrate continued relevance post-pandemic. Undoubtedly, now is a unique time for brands to communicate their values, offer compassion and leadership, and take practical and meaningful actions for the public good.  It’s a time, indeed an opportunity, for brands to engage and entangle with consumers on an entirely different playing field. I suspect that some consumers will, indeed, forget, but some will remember.  Brands matter.