The coronavirus crisis is marketing’s ultimate A/B test

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This is the latest of a weekly column about the big changes and challenges facing media and marketing leaders. Be sure to join Digiday+, our membership program, to get access to this column and all Digiday articles, research and more.

Much of advertising is based on rules and assumptions that, for the most part, haven’t been challenged in years, sometimes decades. 

The TV upfronts. The stick-your-finger-in-the-air “2x multiplier” rule that whatever short-term effect advertising creates, you should expect twice as much benefit over the next two to three years. And for all the snark about the over-exuberance of Cannes, everyone still returned each year to expense countless jeroboams of rosé to their corporate credit cards anyway.

The rules of thumb go out the window if your company is in survival mode. The insistence that brands should keep advertising during a recession won’t pass muster with the CFO when your sales have shrunk to zero and there’s no clear indication of when they will return.

The current conditions set up a fascinating future case study into which of the foundations of marketing remained solid during the global crisis, and which cracked under pressure.

Take the principle of brand building. The received wisdom is that brands are largely built on traditional channels — primarily TV — while digital is more of a direct-response accompaniment. 

Rishad Tobaccowala, Publicis Groupe adviser Rishad Tobaccowala, anticipates we’ll learn two things after the crisis, which could challenge the advertising industry’s prior assumptions.

The first, is “the impact of digital versus analog media, since most folks have retained digital or even increased as they look for outcomes and focus,” he said.

The second revolves around the importance of content, he said. He noted the current blur of “these uncertain times” and “we’re here for you” advertising messages that are so samey they became the subject of a parody compilation video that’s been viewed more than 1.5 million times.

“Few [advertisers are] standing out to solve real issues with great authenticity,” Tobaccowala said. 

Another big question: Will people remember those advertisers that did? And what, if any, impact that marketing had on those companies’ bottom line.

Speaking of bottom lines, the beginning of the crisis saw CFOs forensically scrutinize their company’s outgoings and ask marketers to rip up their annual budgeting plans. Could zero-based budgeting become the norm versus the annual “spend it, or lose it next year” media plans in the long-run?

“It has to,” said Ryan Kangisser, managing partner for strategy at marketing advisory firm MediaSense. “Brands forecasting for 2021 say it’s going to take two to three years to get back to the level they were.”

Zero-based budgeting is a good mindset to retain, Kangisser said. Directionally, he added, more marketers and agencies were already moving to being incentivized on client business performance, versus being bonused on metrics like brand health or on how cheap they can provide media.

“It will force more questions around impact, efficacy, channel allocation and KPIs,” Kangisser said.

Like so many other coronavirus-forced shifts in consumer and business behavior, the question now is which of these disruptive marketing trends will linger and which will dissipate once the adrenalin rush fades and the virtual war room is packed away.

Finally and most fundamentally, what will the role of the CMO look like in the new normal? Was their position within the c-suite strengthened or weakened during the crisis?

“Organizations have had to become more consumer centric through lockdown and if they persist with that strategy they’re likely to lean towards success,” said Martin Lawson, an independent marketing science consultant.

“It’s incumbent on marketers to be the voices for the consumer [within an organization],” he added. “At a time when they’re being squeezed by the CFO and CTO, they’re not always guaranteed a top seat at that table. This is perhaps giving them renewed impetus and vigor and a rightful claim … to guaranteeing a seat.”

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