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March 31st, 2020

Marketing With Care in Uncertain Times

To say the least, coronavirus has reshaped our social, physical and economic landscape. The scale and pace of the change is unprecedented for our families, institutions and for our businesses. Like all of you, we here at Neustar are grappling with what this upheaval will mean for our future, in life and at work.

 

We all wish we could say and do more to make this shared situation we’re in easier. For our part, Neustar is committed to helping your businesses navigate these choppy waters by guiding you towards the best path to protect and, as necessary, pivot your marketing investment.

 

So, in that spirit, we thought it would be helpful to share some of the conversations we’ve been having with our clients to help answer their most pressing questions. Their concerns primarily circle around topics like adjusting media spend, assessing appropriate marketing and advertising opportunities given shifting demand, and keeping an eye on consumer behavior during quarantine.

 

As we do, we looked at the data, analyzed it, and advised our clients based on their goals and how their industries, and brands, are being impacted. There are, of course, no easy answers right now. The balance of 2020 will likely continue to hold a great deal of uncertainty and require a new cadence of analysis, decision-making and action. Marketers and the C-suite can anticipate that these inputs and outputs will evolve in the coming months as more data emerges.

 

The most important question, however, that every marketer should be asking right now, and finding a way to solve for is this: What is our framework for managing through uncertainty in this year and beyond?

 

Even in wildly unpredictable times, peace of mind starts with focus and a well-laid plan. This was something we had to remind ourselves as we grappled to find our own footing about how to best serve our clients right now.

 

We understand that this will be a lot more complex to execute than this may make it sound, and requires coordination, collaboration and trusted partnership. But with the right support and commitment, it is doable. In that spirit, let’s call this framework your Baseline-Adjust-Execute Marketing Playbook, or BAE for short.

 

  • Build alignment around the Baseline

  • Adjust the plan as needed

  • Execute with confidence and agility

 

Build the Baseline

 

Establish how your 2020 plans and projections have already been impacted by current market dynamics. To do that:

  • Leverage Marketing Mix Modeling to understand which marketing touchpoints traditionally drive the greatest impact on your KPIs and their relative level of performance.

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  • Analyze which marketing tactics have, over time, most effectively driven sales to the channels and touchpoints where consumers are moving. For example, retailers should see which tactics have most successfully driven online sales since in-store purchases are quickly shifting to ecommerce platforms – both for store pickup and direct delivery.

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  • Revisit the forward-looking assumptions underlying your MMM and Multi-touch Attribution scenarios to develop a sensitivity analysis of the potential changes in the macro-economic environment on your KPIs.

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  • Refresh competitive analyses to maintain differentiation in messaging and identify potential shifts to response as needed.

 

The goal here is to develop a shared understanding of the current crisis for your market and industry. Consider other historical events and their impact to sales velocity to build assumptions, such as those seen in 2008 with the financial crisis. Global brands might look to areas first hit hard by the virus, such as China and South Korea, to estimate potential impacts to western markets and the potential pace at which they may reestablish themselves at home.

 

Identify decision-making dimensions, including level of investment, allocation, audience targets, and timing, for the next two to three quarters.

 

 

Adjust the Plan

 

While no model is calibrated for this level of external system shock, marketers can use existing analyses to identify new risks and opportunities as the COVID-19 situation evolves. We work with our client partners to develop the following:

 

Response Curve Analysis

 

This analysis informs total budget adjustments given expected declines in sales performance and relative to your brand’s specific objectives. It can help as you seek to balance sales and ROI expectations.

 

 

Media Simulation and Reallocation

This analysis models the impact of lost inventory, such as from the NCAA tournaments and the Tokyo Olympics, and evaluates potential reinvestment scenarios, such as alternative times of year, or different marketing channels. ​

 

Marketers can use simulation and reallocation to determine how best to take advantage of a boost in ad inventory or changes to CPMs.

Incentives and Discounts Tradeoff Analysis

Estimate what level of consumer incentives might be required to buoy demand to acceptable levels of sales velocity. If you do leverage greater incentives, focus on targeting your message to those audiences who are most responsive to that offer in order to, best as possible, limit margin pressures.

External Headwinds Analysis

Understand how macroeconomic declines and decreases to systemic demand affect unit sales and media performance.

 

Consumer Segment Evaluation

Identify changes in consumer behavior and adjust audience targeting accordingly. For example, restaurants that have historically focused on driving traffic into store locations now need to identify audience groups who have a high propensity for takeout or delivery. CPG and retail need to drive offline traffic to the appropriate ecommerce channels. Examine recent changes in media habits such as a spike in online radio. If you have implemented MTA or a DMP, you can leverage the granular real-time data flowing into your analytics environment to dynamically find the audiences that matter based on their current behavior and target them effectively and efficiently.

 

Creative Testing & Analysis

In addition to adjusting media plans and implementing new audiences, many brands are exploring changes to their creative. Brands are creating new, more relevant messaging to address consumer uncertainty and tweaking copy which may have suddenly become outdated. Brands that leverage MTA have the opportunity to test new messaging in real time and reallocate media dollars to the best performing ads.

 

Execute with Confidence and Agility

 

The first step in Execution is knowing when to finalize the Adjustment phase. This is where we remind ourselves and our clients about the 80/20 rule: better to act based on the collection of knowledge you have rather than waiting for perfect information. Next, identify key stakeholders – both internal and external – who are best positioned to help in this time of uncertainty, establishing clear lines of communication.

 

Then, shift to a more frequent cadence of evaluation, potentially in two-week sprints instead of monthly or quarterly reviews and optimize as needed.

 

Consumers are radically changing their behavior in reaction to this global pandemic. Some of these changes will be temporary; others will likely dramatically affect companies, products and behaviors for years to come. With these swift and unexpected changes, it is more critical than ever for marketers to be nimble in their allocation decisions, to be efficient in how and where they reallocate or reduce their marketing investment and, now more than ever, to have confidence that they’re making choices that best serve their respective brands.

 

As always, we’re here to help.

 

 

Click here to find out why Neustar was named a Leader in The Forrester Wave: Marketing Measurement and Optimization Solutions, Q1 2020

 

 

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