Marketers are grappling with three major pain points every day as they navigate the uncharted territory COVID-19 has thrust upon them, says ANA CEO Bob Liodice.
Messaging, budget wrangling and a confusion over internal expectations and goals form centre focus for the world’s biggest brands.
Speaking to Campaign US for its new Pillow Talk series, Liodice added that this pandemic has had a positive impact on in-housing, and underscored the need for some sort of "reckoning" among clients and agencies when it comes to payment terms.
"All of a sudden, the world blows up," he said. "It blows up like a Louisville Slugger bat hitting you around the head, stunning you for a moment and then forcing brands and an industry to step back and say, ‘okay, what are we going to do now?’
"What came out of this period was an acknowledgement that brands have to become different. It builds on a greater degree of what purposeful marketing needs to be, because of the overriding need for consumer empathy.
"What I have been absolutely amazed at is the incredible creativity and ingenuity that many marketers have learned on their own—consumer empathy is about storydoing, instead of storytelling. It’s an opportunity for marketers to acknowledge that they have a responsibility to help the consumers with their fears and demonstrate how they can navigate in a new landscape by providing assistance to any and all who need it."
The 3 major daily pain points facing marketers right now
What will messaging become?
Liodice explained that a lot of brands are grappling with how to gently transition from "almost exclusive consumer empathy to a more normal messaging." A chunk of marketers are diving into these purpose-driven waters for the first time and a question mark hangs over what role this will play when it’s combined with the traditional product-pushing in a post-pandemic world.
"Right now, many are obviously struggling because their companies have reduced cash flows," the CEO said. "So how much is going to be allocated back to them to be able to restore normal marketing? Are their media allocations going to be consistent with what they thought about in the past? And are all those resources they may have appropriately targeted to ensure maximal optimal delivery to their consumers in this new environment?
"A good chunk of them have come off the air and reduced investments in social media platforms by a substantial amount—even Google said they were reducing marketing by 50 percent which shocked me. No one is immune from the turndown. But if you think about it, that is the right call. Because if consumers can’t travel to their normal retail outlets, it’s silly to throw your money away at a behavior that is deeply affected."
Confusion over internal expectations and goals
What expectations and goals should brands be setting for their CFOs and CEOs and shareholders? It’s a question that’s extremely hard to navigate in this new world, because we don’t know what the trajectory is of the recovery and the receptivity consumers will have as we return to a new normal, said Liodice.
The CEO said: "If you’re a CFO, you’re going to be saying, ‘spend less, spend less.’ But if you’re a savvy marketer who learnt their lessons from the recession, now is the time to be investing more. Why? Because it’s the best opportunity to be navigating in a world where your share of voice is going to dominate if you use this time responsibly to gain consumers’ attention by being a sole voice out their talking emphatically."
Liodice said that this has been a positive time for the in-house scene as many brands are forced to finally decide what capabilities belong within brand walls and what should be farmed out.
He argued an increase in relevancy for the in-house movement, underscoring how so many marketers are currently relying on their new(ish) internal production capabilities as costs for third-party vendors dry up.
"We’re seeing a very intelligent approach in what belongs as an in-house capability, yet understanding very clearly what belongs forevermore in the hands of the external agencies," he said. "I think there’s been a boom on the ability to be able to lean on those capabilities which have grown significantly over the course of time. The COVID situation has enhanced the in-house situation for many marketers."
Meanwhile, Liodice shares the same strong rhetoric as 4A’s CEO Marla Kaplowitz on payment terms. He stressed that agencies, supplies and vendors are not banks, when probed about the many marketers which are extending terms to improve cash flow.
He said: "I’ll be perfectly blunt: I think there are situations which are unfair and cross the line, and I am not a proponent of continuing to extend terms. There are some situations which have broached into unfair territory and there needs to be a reckoning between clients and agencies to what is reasonable and sustainable over the long term and stick with that."
When it comes to the ANA’s own membership, Liodice and his leadership team are expecting a drop-off of around 10% by the end of 2020. He described a "flame of dropouts" which have just happened as some brands admit they simply can’t pay the bill this year. The move, he said, will be short-term and many are expected to flock back when the time is right.
Membership engagement, on the other hand, has actually grown as the organisation was fast in digitising almost all ANA products.
The CEO, who has implemented pay cuts but has not slashed jobs or put anyone on furlough, said "we braced for and planned for a shock."
He added: "We believe in ourselves and believe that we add value and enormous help, especially at times like this, but economically we respect that many just don’t have the cash to invest right now."
The organisation has learned a lot about dealing with crises in its 110-year history. Chalk this down as another piece of education that will no doubt fuel the ANA’s instrumental role in adland for 110 more years.