There is no doubt that Coronavirus has stopped the world and forced companies and people to adapt to a new reality.
While companies are waiting for society to return to normality, and consumption levels begin to grow, companies are trying to seize the moment to implement strategies that will allow them to minimize the damage and contribute to a stronger return to the market as soon as possible.
It is important, however, before we talk about possible adaptation strategies, that we talk about what companies should not do at the moment.
Do not exploit the situation.
I have seen some companies trying to exploit fear.
What I mean by this is that the supply of certain products (masks, alcohol gel, detection tests, gloves) is decreasing dramatically and I have seen some companies buying these items and reselling them for 10 or 20 times the price.
This is not entrepreneurship, well marketing, but opportunism. So my first advice is that brands avoid exploiting the Coronavirus situation to make easy money.
And that's not only because it's wrong, but mainly because it's thinking small, because despite the brand making money, it won't last long, and it will certainly be smarter to use the resources and time for something that brings long-term results.
"Be afraid when others are greedy and be greedy when others are afraid"
This phrase from Warren Buffet, is in my opinion something that brands should have as essential advice to come out of this crisis stronger.
We are going to watch companies make cuts because an impact of $2.7 billion is predicted and experts say we are going into recession.
However, what I learned from the crises of 2000 (dotcom) and 2008 (subprime) is that the best time to grow is when someone is doing just that.
In a time of economic downturn, you will see that your competition is smaller, which makes it easier to get results and, in some cases, you will be able to open distributors more easily and close good deals.
Think about how many brands will give up, get into financial difficulties, or make strategic decisions that will slow down your growth.
Again, that means less competition for your brand.
Look for and be inspired by good examples.
Virtual consultations and AR
Many beauty brands still rely heavily on store experience to boost sales, and while health and beauty is one of the fastest growing e-commerce categories, the absence of physical retail stores undoubtedly has a strong impact even on multi-channel brands.
Product purchases are not the only reason why consumers go to beauty shops. On the contrary, it is often pre-purchase experience that drives conversions, such as beauty demonstrations, expert consultations and other in-store services.
Since the coronavirus outbreak, beauty brands have been looking for ways to maintain this kind of personal involvement of customers, with digital technology allowing them to download online consultations.
Several skin brands are launching virtual consultations to guide users on the products that best suit their needs. For example, Glossier is another brand that already has online tutorials, using IGTV (Instagram application) to immerse users in instructional content.
Other dermocosmetic brands are now offering consumers "facial kits at home" to enable consumers to recreate professional-level skin care themselves.
It’s not just social media that brands are using to host virtual consultations either. With video conferencing tool Zoom growing in popularity, Glossy reports beauty brands including Trestique and Glow Recipe have been using it to hold consumer-facing events. The technology allows for greater interaction between brands and consumers, enabling brands to hold what is essentially more of a social gathering than a product demonstration.
Alongside virtual consultations, it’s also likely that we will see brands increasingly look towards augmented reality. The technology has been used by big brands for a while now, with examples such as L’Oreal’s ModiFace enabling consumers to virtually ‘try-on’ make-up. In the wake of the pandemic, it could be a solution that many more consider investing in.
For those who have yet to invest in AR, technology solutions provider, Perfect (which owns the virtual beauty app, YouCam) recently announced that it would be offering a complementary service “in an effort to help beauty brands quickly accommodate in the midst of the COVID-19 pandemic.” This will allow brands to use the browser plug-in to enable virtual try-ons on their own website, as well as be featured in product listings on the YouCam app.
Will consumers continue to buy beauty online during the pandemic? Interestingly, IMRG data show an increase for health and beauty as the blockade began, with sales of this category in the UK during the week beginning March 15 growing 31.6% over the previous year. This may be due to consumers buying products in the vertical health panic. For beauty brands selling online, however, the hope is that consumers will continue to replenish themselves with products that eventually run out again.
Of course, with less need for makeup and other beautification products, this trend is more linked to skin and hair care brands, and anything else that fits into the self-care group. Naturally, during this period, people are more attracted to products that make them feel good rather than serve a functional purpose. In addition, the skin care category aligns with virtual tutorials and consultations, as it requires less competence or practice than make-up.
We are also beginning to see the beauty industry serving consumers who are unable to maintain their regular routines, but who usually rely on regular maintenance and services, such as hair dyeing, manicuring or waxing. The Bleach London hair brand, for example, has launched the "Bleach Hair Party" platform on its website, which is essentially a digital salon that allows customers to choose and buy the right hair colour, as well as an online guide to help them do it at home.
Meanwhile, brands that already offer ‘DIY’ beauty products are seeing an increase in demand. LA brand, Olive & June, has found that demand for its ‘at home’ mani kits have increased eightfold since the outbreak. Haircare brand Madison Reed has also seen sales of its at-home hair colouring kits soar 750%.
Over the past month, we have seen certain beauty brands leverage both scientific expertise and production facilities to help fight the pandemic. The skin care brand Apostrophe supports the World Health Organization by giving priority to the production of hand sanitizers in its laboratory. Apostrophe is also donating any profits from its hand sanitizer sales to the WHO Response Fund COVID-19.
In addition, L'Occitane is also producing hand sanitizers, so far making 70,000 litres for health professionals in France. The brand has also donated 10,000 hand creams to NHS workers in the UK and is sending the profits directly to NHS as well.
Finally, beauty brands have taken a step forward to show support for others who may be particularly vulnerable at this time. Concerned that domestic violence may increase during this period, Avon has donated £150,000 to the women's charity, Refuge. Soap & Glory has also committed to donate 30,000 products to charities, including The Hygiene Bank, which helps provide essential hygiene products to those who cannot afford them.
The important thing at this time is for the brands not to despair, and to be able to keep their cool to think of a strategy that does not compromise their future growth, taking advantage of the moment not to weaken themselves, and putting at risk projects and strategies that they had implemented, but to strengthen themselves and prepare to come out of this crisis even stronger.
Do not be afraid when others are afraid. Do what Warren Buffett does...be greedy when others are afraid.
That is, focus even more.