How to ride the postCovid wave
Think of fish and pick one of the four pathways to the next normal, says marketing agency Head100
Covid-19 has transformed the world. As uncertainties multiply, brands and businesses must learn to navigate uncharted waters in rapid cycles. To inspire businesses to move forward, however daunting the outlook may seem, the Bangkok-based marketing agency Head100 offers perspectives on possible pathways to reimagining the “next normal” — be it old or now.
This pandemic has shifted consumer behaviours and societal values, giving rise to short-term winners and losers. Different sectors and businesses will recover at different speeds and require distinct approaches.
Using the analogy of different fish amid a Covid storm, the pathways outlined — Rescale, Rethink, Resilience and Reallocate — are how brands and businesses can outmanoeuvre this pandemic wave.
1. Rescale: Be a dolphin (yes, a dolphin is a mammal but bear with us) and play the wave like a pro. Covid19 has created a shift in consumer behaviour that has had a favourable impact on some businesses, especially healthcare and the technology firms that have experienced a flood of new users overnight.
For these companies, the pathway is to rescale the business model to handle the exponential surge in demand and transform these short-term peaks into a new and sustainable baseline.
An example of a dolphin company is Zoom, the video-conferencing platform that saw a jump from 10 million to 300 million daily users in just a few weeks as social distancing accelerated its adoption for business collaboration and social use.
Despite some stumbles on uptime and security, Zoom moved quickly to improve privacy and security capabilities, while scaling up its cloud infrastructure through a strategic partnership with Oracle to support the surge in new traffic. It is now set up to capture untapped opportunities in tailored video solutions and new use cases such as telehealth, education and consumer applications.
2. Rethink: Be a salmon, swim upstream and prosper in a new ocean. When current business models are losing relevance or threatened by Covid-19 impact, it is important to rethink the business model to come out stronger in the long run.
With Covid-19 disruption, what got you here might not get you there. Product, consumer and channel diversification including digital acceleration to serve new or existing demand in new ways are some of the most common approaches.
An example of a salmon brand that was able to rethink and prosper in the new arena is the newly launched Buckingham Palace Gin. As tourism revenue in the UK has been hard hit, the palace launched its very own royal gin label, made from 12 botanicals handpicked from Buckingham Palace grounds.
This initiative was created to raise funds for the conservation of the palace’s extensive art collection, known to be the largest private collection in the world. The gin so far has been a hit, selling out within 8 hours of its launch, and is expected to continue post-pandemic as an additional revenue stream.
3. Resilience: Be an eel, survive and thrive in any water. Most brands and businesses are working towards returning to a “normal” baseline. The impact today, high or low, is recognised as only momentary, and long-term consumer needs still exist, for restaurants, airlines and hotels for example. The focus is thus on tactical tweaking of the business model for survival before a full rebound can be expected.
An example of an eel company is the restaurant chain Yum! China, which branched out into cooking kits and catering to survive the lockdown. It has begun catering for its corporate clients, allowing employees to order food through KFC’s mobile app according to their budget.
Pizza Hut, also under the Yum! umbrella, is now delivering raw steaks complete with a recipe for home cooking as a way to boost revenue. It will be a long fight until full recovery but Yum! is hanging on tight and using this opportunity to explore new innovations.
4. Reallocate: Be a tuna, let go of your turf for the better. When the business model is stressed beyond repair, whether consumer demand has shifted forever or supply can no longer be viably fulfilled, it is time for a permanent overhaul, like a tuna that constantly moves in search for the most optimal water conditions.
A reprioritisation or, in the worst case, a complete shutdown of a product line or business unit to focus on a higher-performing priority can be expected. Reallocation, however, is not always negative. It is often seen as an opportunity to cut fat to come out leaner and fitter than ever before.
An example of a tuna company is Nok Air, with the shutdown of NokScoot, its long-haul low-cost affiliate that had been struggling long before the pandemic began due to intense market competition.
A joint venture between the Singapore Airlines subsidiary Scoot and Nok Air, NokScoot has not recorded a profit since it started flying in 2014. Unprecedented challenges arising from the pandemic further exacerbated the situation. The decision to liquidate will help Nok reduce debt and reprioritise its core domestic market.
Clearly this is no ordinary crisis. The four pathways outlined are potential routes to help brands and businesses reimagine the future and navigate the wave of Covid-19 into the next normal. The future will belong to the prepared.
So which fish are you?
Reallocation is not always negative. It is often seen as an opportunity to cut fat to come out leaner and fitter than ever before.