Advertising in Covid-19: The Power of Media Ecosystems is Palpable
The impact of Covid-19 is being felt across the world and we are set to fall into a global recession. The latest report from WARC states that: “The last financial crisis removed $60.5bn from the advertising market, with all media apart from online search recording declines in investment. The market took eight years to recover from this shock after accounting for inflation and currency fluctuations.”
But history does not need to repeat itself. In fact, recessionary periods can actually provide marketers with an opportunity to grow their market share - if they are prepared to think long-term. What’s more, at-home media consumption is spiking as a result of everyone spending more time indoors.
According to the World Economic Forum, new research shows between 80% and 90% of people consume news and entertainment for an average of almost 24 hours during a typical week. In an article published earlier this month, they state that “while the cause of the current crisis is different, the effect is similar to that which we saw during the financial crisis of 2007-2008.”
Studies demonstrate that brands that continue to spend recover faster and remain stronger after a recession - though it does depend on what category advertisers are in, as Simon Orpin, CEO at Electric Glue, explains: ”Some advertisers have had no choice but to withdraw from the market completely, such as travel companies, flight companies and cruises. For others it is a massively relevant time to be running comms. Especially if you’re in the in-house entertainment, grocery or healthcare markets, for example.”
Electric Glue is the agency behind a pioneering approach to media partnerships introduced through a revolutionary broadcaster deal for Yeo Valley and ITV. With the backing of former BBH global head of engagement planning, Kevin Brown and BBH global head of brand planning, Nick Kendall, Electric Glue has completely changed the landscape of media partnerships since its founding in 2014. Different to traditional media agencies, Electric Glue believes that advertiser, agency, and media partners all deserve a seat at the same table. The company creates what they call a media ecosystem, a considered and fluid strategy that opens greater opportunities for all partners. This means tapping into everything a media partner can offer not just their ad space.
Simon, who is no stranger to agile thinking, is urging brands not to give up hope on all marketing right now, but instead to take a case-by-case approach, reshaping previous plans to suit the current climate. “There is now a huge in-home audience which has caused different issues for different sectors of the market. But with all of the evidence that has come through over the years about advertising through a recession (which will be inevitable after the pandemic), it has been shown that brand health can be maintained through strategic marketing. Importantly, it has also shown that brand health can actually suffer if your advertising is put on halt.”
An Audience Awaits
With TV viewing gaining bigger audiences now that everyone is spending the majority of their time indoors, there are plenty of opportunities for brands to take. “People are turning to trusted sources of news, from the broadcasters like BBC, ITV, C4 and Sky to online sites like Telegraph and The Times,” says Simon. “The highest growth of viewing is in a young audience of 16-24 year olds. Some of those patterns will inevitably change when things go back to normal but right now, the opportunity to reach those audiences is unprecedented. Different types of content could be trialled at a time like this.”
Perhaps the increase in linear TV watching could be down to a desire for people to feel more connected in real-time. “The environment and the circumstances we are living in is changing hour by hour. The way we socialise has changed. There is much more social commentary, screen sharing, and a multitude of conference call facilities Simon adds.
Live sport used to be the biggest aggregator of a linear TV audience and earlier this month ITV held a virtual Grand National which reached an average of 4.3 million viewers (28% audience share). Simon comments: “There are some interesting conversations in the absence of live sport regarding what brands and media owners can do. The virtual Grand National was really smart and it was very interesting to see how many people engaged with it. It was a case in point that shows the durability of live content and how much people miss live sport. There are large audiences to be reached if you know where to look.”
He continues: “Media owners, agencies and clients will be looking at how they can work together in a different, more creative way to get through the period and support each other. That includes things like Mcdonald’s and Pret giving food to health workers when they still could, and other brands coming out of market and donating the space to charities. There have been some quite phenomenal things we’ve seen already and long may it continue.”
However, as broadcasters see a spike in viewing, it seems that streaming services haven’t followed suit. “Increased viewing has grown the most dramatically across broadcasters and less for on-demand services, so you have to ask the question whether the short-term situation will have a long-term negative effect on a streaming service. There are no new productions going on and there’s going to be a natural shift to people getting bored of Netflix once they’ve basically concluded they’ve seen everything currently available.”
For broadcasters, this can be overcome through reruns of old shows. “A big proportion of the UK won’t have seen them the first time around so I think there’s going to be a real resilience there which will bode well for TV broadcasters,” Simon says. “Programmes may gain a new fanbase.”
Opportunities Arise
So how can brands who are still advertising understand how to use these opportunities effectively? Simon predicts that “it’s going to be a brilliant time to prove the resilience for TV as a medium, growing long-term commercial help for brands. Brands who thought TV was out of reach for them because it was too expensive or took too long, may be coming into the medium now.”
And as media consumption has changed, so too has purchasing behaviour. “Broadcaster and radio ecosystems have become quite a vital part of a client’s ecosystem, especially if you’re a retailer, as e-comms become far more important,” states Simon. “The whole fulfilment process can now be done within the ecosystem of a broadcaster in a way that couldn’t be done before. We’ve been talking to our clients about how they can use their ecosystems as media owners in their own right, and how they can make it work harder for them, especially if they are a service provider and need to be able to support their own customers.”
He continues: “Our approach means that we can assess the whole ecosystem within a media partner and adapt our strategies. We can start to develop some short-term tactics that can lead to long-term strategies, and what we tend to find is that the partnership approach is reciprocated back to us by the media owners because they know we work with them in a very different way. We’ve found all the media owners to be very proactive in this short period of time - especially the broadcasters.”
A Carefully Considered Long-Term Approach
“It’s interesting to see how brands are understanding what the opportunities are - but it needs to be about taking appropriate opportunities and not direct profiteering,” Simon warns. “People right now want to know how a brand is going to help them through this time, not what they want to sell us.”
And Simon reveals that it can actually be a far more cost effective time to reach large audiences: “There’s a reduced price point for advertising because revenues are dropping. Brands who will profit in the long-term are those that, with the support of their agencies and like-minded media owners, are continuing to spend. That leads naturally on to them obtaining an excess share of voice vs market share, which has been proven many many times to lead to gains in market share in the short-term, and growth in the long-term.”
“At the same time, we need to be realistic and pragmatic that many brands are facing issues with cash flow and they may see marketing as the first place to go to for a saving. But we hold the view that those who can resist doing that will actually be stronger in the longer term.”
It all goes back to keeping a consistent presence and staying in-market where you can to achieve excess share of voice. “The cost point has dropped so much that you don’t need to keep so much money in to stay ahead of the competition in your sector,” Simon explains. “You need to also think about how you’re using your own media ecosystem and your own social platforms to stay relevant but also supportive of the current situation.”
Unglue, Re-glue, Super Glue
For those who are able to continue marketing, it is important not to forget to be aware of any content that may be deemed inappropriate in a time as sensitive as this. “Keep a close eye on social media to check that there’s no backlash to the content that you’re running,” advises Simon. “At the same time, social commentary can be used to work out what you’re doing right and where your brand’s focus should be.”
The opportunity for short-term contextual content generation is especially interesting right now. As experts in agile media placements, Electric Glue have been busy adapting strategies for their partners. “We’ve done that with one of our casino-based game brands. Part of the original strategy was to play along live with people in casinos but now that restrictions are in place with casinos shut, we’ve had to make amends to that. We’re working with Sky to adapt this and create flexible content with a very quick turnaround time.”
“As soon as all this hit we had to unglue a lot of partnerships because of things that were no longer relevant, and had to reglue them in a new way,” says Simon. “Now we need to look at supergluing them to build out those partnerships strategically for the next 6-12 months so that our clients are as fit for purpose for the recovery period as much as possible.”
“We’ve always been an ideas-centric business and we want to be more proactive to continually be coming up with new opportunities. We’re very agile as a business and, because the media owners who we work with know this about us, it’s a very natural time for them to look to us for increased support now more than ever.”
