The Coronavirus impact: truths, principles and positives

Fold 7's Marc Nohr explores the impact of the Coronavirus on our industry.

As the Coronavirus continues, Marc Nohr explores the impact it is having on our industry, provides guiding principles to help us weather it and highlights the positives we should hold on to as we look to the future.

We need to start with a brutal truth. In the last few weeks, real damage has been done to the economy and to people’s lives. Levels of anxiety have risen as many fear for their families, their communities and their livelihoods, compounded by the stress of lockdown and the dominance of bad news in the media. The mental health crisis society was already suffering from, is now a pandemic of its own.

The industry impact

This is a problem that sits way above the advertising industry, so we need to avoid taking a parochial view. But clearly it’s had a massive impact on us as well. Adspend has fallen through the floor, resulting in furloughing, layoffs and cost reduction as revenues are hit hard. Freelance work, constituting a significant part of the agency ecosystem, has all but dried up. And it’s likely that we’ll see many businesses fail this year.

As I write this, the consensus amongst economic commentators is that it will take until the end of next year for the economy to recover the position it was in before the coronavirus kicked in. And yet, I’m an optimist by nature. 

The entrepreneur in me knows crises force significant change; and change can be positive. We will come out of this. The pendulum will swing back. But first comes the hard graft.

Faced with an unpredictable enemy and no data to base predictions on, no one can say for sure how deep the crisis will be or when things will improve. I would like to believe a V-shape recovery is possible, but I fear we need to prepare for a slower, swoosh-like return to health, with the upward tick itself coming in incremental steps.

Our post-survival strategy

Once we have dealt with the question of survival, the next challenge is to craft an effective strategy to get us (and our clients) out of this. For all the talk of how the coronavirus is a 'leveller', (all the way up to Princes and Prime Ministers) the impact of the virus has been asymmetric, hitting individual people, communities and sectors differently. We don’t know how long governments will be able to maintain subsidies and so how long business can survive. In a rather chilling headline this weekend, the FT pronounced that of the 3-5 million people currently furloughed in the UK "a lot of them are actually jobless, they just don’t know it yet".

Guiding principles

In such turbulent times, it’s been important to me to draw on as many inputs as I can – speaking to friends and clients who are leaders in their fields, devouring newspaper and online columns written by economists, scientists and behavioural change experts, scouring history for enduring truths, keeping abreast of news from around the world and being attuned to insights wherever they come from.

I chair a charity as well as a range of different marketing services agencies – and though each is different, there are certain guiding principles which I’ve sought to apply in advising them. They include:

  • The preservation of cash – without which organisations can’t survive.
  • Deferring to core purpose, business objectives and values – which if set correctly - should be enduring. That includes our commitment to treating people with dignity and recognising that they may be colleagues, clients, partners but they are human beings first.
  • Knowing that this will pass – it’s a question of time. Things will change, but human nature is not one of them. This we can rely on, absolutely.

A flexible future

So what changes can we expect and embrace as the world recovers from Coronavirus? This is a time to rethink, innovate and acquire – be that new skills, new perspectives or new companies. And as with every crisis in history, this period will demonstrate the survival of the flexible.

I’ve been a passionate advocate for flexible working for a few years. Things really needed to change; we’ve all just been shown how in a forced mass experiment. We have at once realised how much of our work can be done remotely using technology – creating more time for other things (unless you’re also doing childcare) and creating less impact on our planet. And yet, this experience has also reminded us of how social we are, how much we rely on serendipity, non-verbal communications and just the joy of human contact in our day-to-day communications. Both views – the benefits of home working and the benefits of offices - are simultaneously true. We should be able to find a greater balance going forward.

How about brands? Clearly, some have fared better than others but most have suffered a terrible blow. According to a recent poll, most people say that the way brands have behaved during the crisis will affect respondents’ future buying behaviour. In a typically amusing column, Mark Ritson pointed out the ridiculousness (on methodological grounds) of even asking questions like this. But certainly, corporate actions and behaviours, with staff, customers and wider society, will not go unnoticed.

Doing the right thing

Pre pandemic, we complained of reaching 'peak purpose' - the dominance of PR and awards-bait campaigns that were rarely meaningful or profoundly impactful. The virus has reminded us of the importance of doing the right thing, in life and in business. As ex P&G CMO Jim Stengel’s famous study proved: purpose and profit can go hand in hand.

As individuals, we’ve been reminded about the existence and indeed the benefit of our communities, asking: "How are you?", genuinely interested in the answer and looking to help in any way we can. We’ve engaged more deeply with family and with nature. We’ve walked and cycled more. We’ve listened to the voice of science over social media.

And we’ve seen business pivot to do its part: brands like Burberry and McLaren turning their hands to making PPE, ventilators and hand sanitisers; brands like Leon and Pret catering for front line workers. And businesses like Carlsberg launching an ecommerce platform for pubs, bars and restaurants to get them back on their feet (see www.loveyourlocal.com).

We’re also witnessing the potential of mass data sharing, automation and Health AI: whether it be innovation in data location services, facial recognition, heart rate and body temperature monitoring, and app-based GP services.

According to Microsoft CEO Satya Nadella we’ve seen "two years' worth of digital transformation in two months".

It is impossible to know which of these changes will be short-lived and which will be enduring, but we know that people form habits through repeating behaviours. Months of lockdown and long-term social distancing will ingrain new habits, behaviours and even brand loyalties.

Will we stick with the new brands we may have started buying or old brands we’ve stopped buying during the crisis? Will discount brands enjoy a period of boom as they did after the financial crisis? Will agency/client relationships, ways of working and commercial models be completely rethought?

Will we shake hands again? Routinely wear masks when we’re ill or flying? Learn to live with less? Will the long-term environmental crisis be impacted by this experience over the next 1-10-50 years?

As a budding journalist I was told not to construct sentences with endless questions, as I have just done. But I don’t have the answers, so at this stage it’s the best I can do. However, I will close this piece with a few aspirations.

Holding on to the positives

As we look forward to the future, I hope we will hold onto the positives: greater kindness towards each other; respect and care for the invisible in society; recognition of the importance of supply chains, transport, logistics, food and medicines; openness and cooperation across borders, sectors and disciplines.

Above all, we must be sensitive to our vulnerability. Coronavirus is a reminder of the frailty of human existence. But also the dangers of short-term thinking and the importance of long-term planning, when it comes to public health and the health of the planet.

To weather the storm, thrive even, we need strong government, businesses and cultures. Transparency and good communication. People and brands that lead, with agility and imagination. And of course the quality which our industry has always had in plentiful supply: creativity.

Marc Nohr is Group CEO Miroma Agencies / Chairman Fold7 / Chair of the IPA -Commercial Leadership Group and an IPA Fellow. This article is based on a panel session at which Marc spoke during the ExO World Summit, which was held last month by Singularity University.

Last updated 02 June 2020