6 minute read
Ever since the pandemic halted life as we knew it, one message remained constant: we're all in this together. It's been said by international organizations, national governments, local politicians and, of course, brands. It's been used as a sign of hope, progress, and action. But is it true?
Recent data suggests that the economy is diverging into a K-Shaped economic pattern. A K-Shape emerges when certain sectors of the economy, such as technology, health, and e-commerce grow, while other sectors such as retail, travel, and tourism retract. As this pattern takes hold, some people thrive while others struggle to survive.1
Young people, new Canadians, and women have been disproportionately affected by the negative economic consequences. They are experiencing the bottom part of the K, and many of these people are now on the brink of bankruptcy. Recent studies have shown that 69% of Gen Z, as an example, are $200 or less from insolvency, which includes 39% who are already insolvent. Other vulnerable groups are in a similar situation.2
From an economic perspective, the data seems clear, we're not all in this together. But the story doesn't end there - it's just the beginning. Canadians expect more. They are disheartened by rising inequality, expect brands to step-up, and reward brands that take tangible action.
Canadians want brands to take real, tangible action
The words of Larry Fink, CEO of BlackRock, ring truer today than they did in 2018: "The public expectations of your company have never been greater...Every company must not only deliver financial performance, but also show how it makes a positive contribution to society."
A whopping 89% of consumers want brands to shift money and resources to producing products that help people meet pandemic-related challenges, and 80% say that solving society's problems is very or extremely important for a brand to earn or keep their trust. Sixty-two percent (62%) say that their country will not make it through the crisis without brands playing a critical role in addressing the challenges society faces.3
Taking action starts by being authentic to your brand purpose. While not every brand should take action on every issue, every brand should take action on the issues that are inherently linked to their purpose and capabilities, keeping in mind the expectations of Canadians and the consequences of an uneven recovery.
Actions speak louder than words. Forbes recently revealed that actions, instead of words, are at the forefront of every best-in-class purpose-led brand.4 It's about results, not intentions: real and tangible results that make a difference in society, as well as build brand trust and fuel long term business growth.
As powerful and influential brand owners, we can help turn empty words into tangible results. We can help ensure that we are truly in this together.
Taking action to help solve today's challenges
The K-Shape recovery poses a number of challenges that brands can help solve through purpose-led actions. While every brand should approach the issues from the perspective of their brand purpose, we've outlined a few opportunities of broad applications to start the conversation.
1 - Reskilling - helping those who are most affected
As the K-Shape disproportionately affects those in unskilled jobs - many of which were already at risk of redundancy through automation - brands can help prepare people for their next job. Whether it's advice, access to knowledge, or supporting reskilling and retraining initiatives, brands can use their power to prepare the financially vulnerable for a new future. For example, banks can use their human capital to help mentor and guide aspiring entrepreneurs, giving them the economic foundations, business connections, and access to capital they need to reinvent themselves for a changing economy.
2 - Philanthropy - helping people help people
Recent data by Deloitte suggests that despite low consumer confidence, Canadians are feeling charitable towards others.5 Based on this survey, Canadians are planning to spend 85% more on charitable gifts than in 2017, indicating that people are keen to help those on the downward slope of the economy. Brands can help facilitate this in a variety of ways, such as a giving a percentage of each sale to a cause or asking for contributions at the checkout. The best brands will align their activities with their purpose and their business.
3 - Advice and Knowledge - the bedrock of progress
As the number of vulnerable people in Canada rise due to sectors of the economy shutting down or operating at reduced capacity, each of the people affected will have unique circumstances. Brands can help by providing advice, knowledge, and information about everything from finances, to shopping, to earning money and more, depending on the brand's purpose and inherent capabilities. TD Bank was quick to act launching Ready Advice, an offering that spans across the bank's many business lines and provides customers with financial advice and information to make informed decisions based on their unique circumstances
4 - Supporting small businesses - fuelling the economic cycle
As an important engine of the economy, small businesses are the gateway to improving the economic situation for business owners, employees, their families, and the communities they serve. Brands can help by considering how they can assist each of these stakeholders individually or how their actions can assist multiple stakeholders at once. For example, credit card companies can support small businesses by incentivizing card holders to shop at small businesses in exchange for bonus loyalty points. This is similar to CIBC's Revival Rewards™ program which doubles the reward points for dine-in or take-out purchases at restaurants. Large advertisers could also use their media weight to help promote small businesses or even partner with them to create unique offerings.
5 - Health and safety - using CX to increase economic activity
During the last U.S. recession, the stock performance of CX leaders outperformed both the market average and CX laggards.6 Today, as the holidays approach amid a global pandemic, CX is even more important, because not everyone will want to shop online. Businesses should look at their policies, procedures, and physical spaces to provide a safe, convenient, and modern customer experience. This could include curb-side pick-up, appointment based shopping or outdoor dining pods. Banks could introduce mobile pre-ordering for cash withdraws from ATMs or branches, and auto dealers could bring test drives to their customers' homes.
Two recent CX reinventions stand out. Canadian Tire was quick to reinvent their CX at the beginning of the pandemic with a robust e-commerce, delivery, and curb-side pick-up offering, helping customers shop with confidence and driving strong business results in return. Cadillac was also quick to reinvent their shopping experience with Cadillac Live - a first of its kind digitally-enabled showroom where customers can take a live one-on-one vehicle tour - a truly revolutionary experience born out of the brand's unique purpose and the restrictions of the pandemic. To begin the process, brands should complete a CX audit and opportunities map to identify quick wins.
Leo Burnett has helped brands use their purpose as a central force in business for the past 15 years. Today, more than ever, it's critical that brands act with purpose and support people affected by the economic consequences of the pandemic. If you'd like your brand to take purpose-led action that makes a tangible difference today, we'd love to help.
Contact:
Ben Tarr, President
Leo Burnett | Toronto
ben.tarr@leoburnett.ca
416-909-9817
Ryan Roberts, Vice President, Strategy
Leo Burnett | Toronto
ryan.roberts@leoburnett.ca
1 K-shaped recovery provides opportunities for some Canadian exporters, Globe and Mail, October 2020.
2 MNP Consumer Debt Index, October 2020.
3 Special Report: Brand Trust in 2020, Edelman Trust Barometer 2020.
4 Purpose At Work: 10 Brands Leading With Purpose In 2019, Forbes, December 2019.
5 Deloitte Canada, 2020 Holiday Retail Outlook, October 2020.
6 Watermark Consulting, Customer Experience ROI Study, 2019.