Walmart Media Group’s VP of Strategy, Stephen Howard-Sarin, on how brands should communicate during a crisis, COVID-19's impact on retail advertising, and how Walmart Media Group is responding.
Q: What are the key questions brands need to ask themselves when dealing with the current COVID-19 landscape?
A: "Who are we in the customers’ lives? And how important is that right now?" This is not the time for features-and-benefits marketing, unless your product is pragmatically and insistently part of a family’s response to the pandemic. Emphasizing traditional-but-irrelevant benefits right now could ricochet and damage your brand’s reputation.
I found Matthew Rothenberg’s latest blog on quite insightful.
Q: Marketers and advertisers are experiencing a dual crisis: the pandemic and the aftermath. How should brands tackle this two-fold challenge?
A: For the pandemic, marketers and advertisers must lean into their brands. Coming out of the pandemic, advertisers and marketers will need to prove the value of their tactics again.
In a crisis, customers demonstrate a "flight to brand equity." We’ve seen a renewed preference for the products customers have known their whole lives. It’s not a good time to be a challenger brand that requires customers to rethink a category. Brands need to be careful; their stories should stick close to their core identity and remind people of what their companies stand for. Of course, you only get this benefit if your product is widely in stock where customers shop. That must be every manufacturer’s priority.
In a recession, marketing departments experience a "flight to performance." Budgets are frozen, cut, and redeployed toward media tactics that prove their worth in the short-term. This is where the data become paramount.
Marketers and advertisers need discipline about how they will measure short-term performance – your bi-annual Media Mix Model (MMM) won’t help you at the moment. Don’t let the perfect be the enemy of the good; measure the channels and customer groups that matter in ways that are speedy and consistent right now.
Q: How has the pandemic impacted retail advertising?
A: Retail media is secure from many of the worst advertising pullbacks and short-term budget cuts. Retailers generally don’t participate in travel or restaurant ads, or ads from competing retailers, all of which are shrinking dramatically right now. Retail media, in general, lives off advertising from manufacturers, and they are still marketing heavily. That’s the demand side.
On the supply side, the activity on retail e-commerce is way, way up. Massive numbers of new customers are searching daily, which creates opportunity for keyword advertising. We’re witnessing unprecedented shopping behaviors equaling, if not exceeding, major holiday season demand. The volume is dramatically higher, and the loyalty is lower. Customers shopping online will go where the products are, as holiday shoppers typically go where the bargains are.
Q: How is Walmart Media Group adapting to this new environment?
A: At Walmart, our associates are doing truly essential work; our frontline associates are helping worried families save money when they really need it and live as best they can during a pandemic. Walmart Media Group is a part of this greater team, and we must support that mission in any way we can.
Walmart Media Group has a role in protecting our advertisers’ brands and investments, too. We’ve reviewed every advertiser creative to shield their brands and ensure they are not inadvertently off-message. To protect their investments, we paused campaigns pushing products that might not be fulfilled – even if it’s just in one region or for a few days. We know we are in long-term partnerships with our advertisers, and now is the time for Walmart Media Group to be flexible and proactive.
Q: What is the one positive thing you will take from this experience?
A: The role of retail in customers’ lives is greater and more fundamental than I appreciated before this crisis – it really feels like we are performing a vital, community function right now. Advertising is not the most important part of this function, but I’m grateful to be any part at all.