Uncovering Opportunities in Uncertain Times
Consumer spending makes up about 68% of GDP within the United States, according to The Wall Street Journal’s monthly Consumer Spending Report. However, with the impact of social distancing, dramatic increases in unemployment and a reduced confidence in the economy, retail sales experienced a staggering 9% decline in March1. Even with the recent infusion of stimulus checks, this rapid decline is expected to worsen even while industry giants like Netflix, Amazon and Walmart continue to thrive.
As dire and unbalanced as the circumstances are, there are still glimmers of hope for savvy retailers who relentlessly evolve with the times.
According to Nielsen, six categories of consumer behavior have seen major shifts which can be tied to COVID-19. Below are three that we have continued to focus on and track as they impact our clients closely.
- Health-related Products: It is not a surprise that health-protecting products continue to perform strongly more than eight weeks into this “new normal.” Sales of both hand sanitizer and medical masks are continuing to rise and are not expected to reach peak demand for several months.
- Pantry Needs: Shelf-stable products are more important than ever. People are going to the market less frequently, and when they do, it requires immense planning before and after.
- Health-Adjacent Categories: Although this is a unique behavioral segment, it is clearly related to both numbers one and two above. This includes things like diapers, baby food and juices. As these are nonperishable and required for day-to-day household management, people are stocking up when making these purchases.
COVID-19 Case Studies: Marketsmith has found strategic ways to ride the ecommerce wave and support our clients’ business growth objectives.
What’s Happening: For specialty retailers that drive a tremendous amount of revenue through their brick-and-mortar presence, the mandated store closings related to COVID-19 had the potential to be detrimental to their business. To combat this challenge, Marketsmith partnered with each client to identify alternative marketing opportunities and pivotal shifts in media tactics to ensure continued revenue growth.
Client Success Story
As a manufacturer of kitchen and household products, SharkNinja drives revenue through a combination of phone orders, ecommerce engagement and store-based sales. A strong component of its marketing strategy has always hinged on the long-form television marketplace – with television viewership up 14% YoY during the months of March and April and pricing down 15–20%, this was a perfect opportunity to lean into that tactic.
“A man who stops advertising to save money is like a man who stops a clock to save time.”
– Henry Ford
- Kitchen products cost to acquire decreased 18% month over month
- Vacuum products cost to acquire decreased 25% month over month
- Consumer engagement over the past 30 days has exceeded the prior holiday season
Client Success Story
Marketsmith client Lovesac is the creator of a versatile high-quality modular furniture solution. Success had historically relied on the tangible ability for a customer to see and feel the product before purchasing. Lovesac needed an immediate and innovative approach to evolve this experience to life on a digital platform. CEO Shawn Nelson led his growth-minded company toward new opportunities by generating unique content daily and accessing new media channels like TikTok and Pinterest. This viral content has developed a following that contributed to a 300% YoY ecommerce growth.
Additional innovations introduced by Lovesac include:
- Heroes program offering 40% off to medical professionals, first responders, military and teachers – this is driving more than half of their sales right now
- Warm prospect campaigns targeting customers with quotes, swatches or referrals
Ready to be the next success story?
Marketsmith makes the ideal partner, especially in times like these. Where others see the problem, we see a world of possibility. Our passion is to help businesses like yours uncover new opportunities in this “new normal” and implement tactics that will grow your business in ways you never thought possible.
1 U.S. Department of Commerce