The Brand Move Roundup – May 28, 2020
We’re tracking the notable brand moves & highlighting the companies who are tackling this challenge successfully.
We started this series of brand updates on March 12, but the reaction has been so positive, and the crisis so fast-moving, that we’re going to move to a continuously updated rolling news format from now until it’s all over (hopefully soon). Keep checking back here for the latest updates on how brands are dealing with coronavirus.
Social media platform Pinterest has begun testing new technology that allows users to purchase groceries directly from the site. Users scroll through the platform, click on a food image they like, then click again to order all the items necessary to recreate the dish showcased in the post. According to Arthur Sevilla, Pinterest’s head of global vertical strategy, the new function has seen strong conversion rates, thanks in part to the timing of its debut. In the past six weeks, the number of U.S. consumers adopting digital channels to purchase groceries has been “more than we’ve seen in the last six years,” said Sevilla. A recent report from Coresight Research found that 49% of U.S. adults who’ve bought groceries online in the past 12 months say they either started buying groceries online or are buying more groceries online because of Covid-19. While many consumers are turning to ecommerce for household goods out of concern over contracting the coronavirus, Sevilla believes the behavior will stick due to the ease and convenience the experience provides.
“I suspect we’ve moved to a different plateau of normalcy,” he said. While this period has seen an uplift for online grocery, it’s also been positive for Pinterest; its Q1 revenue increased 35% to $272 million, while its number of global monthly active users climbed 26% to 367 million.
In the U.S., motorsport series Nascar has been the first major sport to return – but while races have returned, the fans have not. Screening players, coaches and broadcast crews for Covid-19 is possible, but fans pose a much more complicated safety issue. But surprisingly for brand-heavy Nascar, the lack of fans in the stands has opened up another revenue stream. According to a report from GumGum Sports, in Nascar’s first race back, the new white space created in bleachers typically obscured by fans was worth about $3.4 million. Add in another $220,000 for the white space created by now mandatory masks, and the total added value is $3.62 million per race. The cumulative potential sponsorship exposure of the added white space would be close to $140 million – with $132 million coming from the stands alone – when extended over an entire season if Nascar maintains strong viewership. The first race back racked up 6.3 million viewers, but expecting those numbers throughout the season is unlikely; the race represented a 38% increase in viewership compared to the final race before the shutdown.
Confectionery company Hershey has said that sales of gums and mints have taken a hit as social distancing protocols spurred by the COVID-19 pandemic discouraged people from participating in gatherings. The company, the maker of Ice Breakers and Kisses, said its second-quarter performance would also be impacted due to a decline in its food service business and stunted candy sales at airports and stores. Hershey has for long been betting on its nutritious and on-the-go snack portfolio, a hit with health-conscious consumers who would pick up protein bars before heading to work – again, something that has been badly impacted by the recent work-from-home scenario.
When Japan’s soccer J-League resumes in a few weeks’ time, it will be in stadiums devoid of supporters. But a new smartphone app could mean the action won’t unfold in atmosphere-sapping silence. The Remote Cheerer system developed by Yamaha allows fans following the match on TV, the radio or online to encourage – or berate – players via their smartphones, their voices reverberating around the stadium in real time via loudspeakers. In a recent field test, users in multiple remote locations chose from a range of on-screen options that sent their cheers, applause, chants and boos into the 50,000-seat Shizuoka Stadium Ecopa via 58 speakers set up among the empty seats. “Users were able to gain a sense of being present at the venue, even though it’s a massive stadium,” Yamaha said, adding that the system “demonstrated the ability to create a spectator atmosphere similar to that of a real match.” Yamaha said it would improve the app, developed with help from J-League clubs Jubilo Iwata and Shimizu S-Pulse, so that it can be adapted for use at a range of sports and other events held behind closed doors or with limited numbers of spectators.
The J-League is expected to resume matches in late June or early July, pending agreement from its 58 teams. Meanwhile, Japan’s professional baseball season will start behind closed doors on 19 June – three months later than scheduled – the sport’s commissioner said this week.
Virtual consultation technology on beauty brands’ sites has surged during the shutdown. Companies that recently launched virtual consultations include Glow Recipe, Huda Beauty, BareMinerals, Clarins and Dermalogica. These online features look set to become a permanent fixture of the digital beauty shopping experience as they encourage higher conversion rates with direct links to e-commerce. Brands typically employ third-party platforms to integrate consultations into their site; virtual video chat startup Hero has added Deciem, Cos Bar, Innersense and Laline to its roster of clients during the pandemic. “Beauty has been one of our standout categories since Covid-19 hit, due to a confluence of several trends at once: a growing interest in self-care, a surge in online shopping and a craving for human interaction at a time when most of us are limiting our time outside of the home,” said Hero co-founder Adam Levene. Credo Beauty was a client before the pandemic hit, and its COO Annie Jackson said that Hero drives between 12-15% of the brand’s digital business now. The retailer kept all 60 of its physical store employees employed during store closures by having them answer questions through the Hero app, which she said leads to an average of $20 higher basket size than online shoppers who do not use the virtual consultations. Hero said that its beauty clients have seen a 2.5-fold increase in chats since the pandemic hit, with 25% of all virtual shopping sessions resulting in a sale. The platform allows consultants to drop recommended items directly into a user’s shopping cart. The company reports that its beauty clients have had a 388% increase in total sales since the start of the Covid-19 shutdowns, along with a 32% increase in their conversion rate.
While many cities and states grapple with the process of reopening, the stakes are high for Las Vegas, which has been hit particularly hard. About one-third of the local economy comes from the leisure and hospitality industry, more than any other major metropolitan area of the country. Last week, though, Governor Sisolak signaled that casinos could reopen as early as June 4. But guidelines issued this month by the Nevada Gaming Control Board limit capacity to 50 percent and require new cleaning and social-distancing policies. Casinos are now taking out slot machines — which can make up half of the gaming revenue at many establishments — and considering raising minimum bets at card tables. Regulators have capped capacity at three players a table for blackjack and four for poker. As one example, about 100 slot machines at the El Cortez casino have been removed and the remaining 750 are now farther apart. Tape on the floor at the craps tables shows players where to stand to meet social-distancing requirements. “The days of 16 people standing around the dice table high-fiving one another are over for now,” said Adam Wiesberg, the general manager of the El Cortez. The casino has installed clear, removable plastic partitions between players at card tables and while players won’t touch the cards in games, Mr. Wiesberg brought in Elite Chip Care, a local business that cleans and sanitizes chips using ultrasonics, in mid-May to clean 28,000 chips and is using an antimicrobial protectant on the chips that claims to protect surfaces for 60 days. Employees will have temperature checks. Executives at casino and hotel operator Wynn, which reported a 42 percent drop in revenue in the first quarter and saw a $105 million profit from a year ago turn into a $402 million loss, say they plan to open both Wynn and Encore properties. The stock price of Wynn Resorts is down 46 percent this year. Executives at MGM Resorts, which runs more than a dozen casinos on the Strip, told Wall Street analysts in late April that the company would likely first open the Bellagio, home to the famous water fountain show, and New York, New York, a mid-range property that features a roller coaster. MGM’s stock has dropped 53 percent this year.
All the hotels and casinos are taking safety measures. The Venetian, which is owned by Las Vegas Sands Corporation, has installed thermal cameras at entrances, put up plastic barriers at hotel check-in desks and removed about half of the chairs at its pools, rearranging the others to meet social-distancing protocols.
Online grocery shopping portal Instacart has quietly debuted its self-service tool for promoted products in search results in its advertising platform as demand for the company’s services continues to climb. Brands and agencies can now buy ads through a self-service platform. The move toward featured products in search results will enable the online platform to not only compete for ad dollars from grocery brands advertising on ecommerce sites such as Amazon and Walmart, but on Google, Bing and Facebook as well. Brands can set their own goals and ad budgets and manage bid prices. Procter & Gamble, Unilever and Pepsico, among others, have tested the sponsored ads platform in the past two months, buying media and managing campaigns. Instacart personalizes search results to ensure that Featured Products serve up based on the perfect search, but the triggers required to view certain results are not clear. The company also offers other Marketplace Ads such as category banner ads, coupons and delivery promotions such as managed partner services. eMarketer estimates that online U.S. food and beverage sales will increase 23.4% to more than $32 billion by 2021, and a CivicScience study suggests that 22% of U.S. adults participating in the survey rely on food delivery services, up from 19% in early April.
CNN has just produced a branded marketing campaign for the UN World Tourism Organization, making the point that travel and leisure brands are ready to return to the market. CNN and the UNWTO have released the ‘Travel Tomorrow’ campaign, a 60-second film taking viewers to eight locations around the globe. The hope is to stoke wanderlust among tourists waiting for travel restrictions to be eased around the world. The film, produced by Create, CNN International Commercial’s (CNNIC) in-house creative studio, conveys optimism for prospective journeys. “Every nation and every company dependent on travel and tourism needs to be developing their strategy to attract and accommodate visitors for when the world is ready to travel again,“ said James Hunt, vice-president of creative and marketing lead. “We will work closely with our partners to pivot current awareness campaigns to actual destination campaigns.”