When it comes to the COVID-19 outbreak’s reverberations in the marketing and PR industry, Little Rock ad executive Millie Ward knows what she doesn’t know.
“Our thoughts today will be different than our thoughts tomorrow,” the Stone Ward agency president told Arkansas Business. “Things are moving very fast, and with every announcement, new unprecedented situations are being created.”
Her team, based in Little Rock and Chicago, has been taking the same steps as many office operations, letting employees work from home and enforcing social distancing for those who must be at the office. She also has key employees analyzing the pandemic’s effects on industries and clients.
Brett Parker, Stone Ward’s director of media and digital services, said brands are adjusting to new consumer routines and slashing marketing budgets. Citing eMarketer and the New York Post, he said the outbreak could slash as much as $3 billion from ad and marketing budgets nationwide this year. “As brands begin to reduce budgets, marketers are forced to do more with less, trying to meet the same campaign objectives with up to 50% reductions in their weekly marketing budgets.”
Content providers “are scrambling,” Ward said, “as are the networks, to replace advertisers who are cutting back.” Others are looking for new opportunities who now need those networks “to get their messages heard.”
So marketers need to get the most out of their budgets and pivot to where consumers are today — at home. “Forecasts predict that digital ad spending, mainly through streaming video content, will have the largest growth at 42%,” Parker said. “Traditional media such as television is also expected to remain somewhat stable” as more attention is heaped on daytime viewing.”
'Stay In and Tell a Friend'
The Design Group of Little Rock, led by Myron Jackson, has gifted his firm's work to the city of Little Rock for a "Stay In and Tell a Friend" multimedia campaign including billboards, radio spots, digital and social media, all emphasizing that social distancing saves lives.
"COVID-19 is not a game, so why would you play with your life?" Jackson asked. "Mayor Frank Scott Jr. saw the importance of distancing long before other leaders, working to avoid what other cities have endured."
To get the word out, Jackson's team provided its work free of charge, conceiving a simple alliterative message: "Stay in and Tell a Friend: Social Distancing Saves Lives." Staying home in this crisis is a lifesaver, Jackson said. "People need to stay home, and to let others know they need to stay in."
It was a quick-turnaround project, Jackson said, going from concept to billboard in just two weeks. "We needed an aggressive radio campaign to reach people in their cars, to make the point how important it is for everybody to adhere."
While Jackson said the Design Group's work on the project was gratis, he did not know what the city was spending, if anything, on media costs.
"We live in the city, and our staff lives in the city, and we want to flatten the curve, to do our part to help our neighbors."
He said the campaign is likely to be active eight weeks, and perhaps longer. "It will continue at least through the eight-week peak period national experts are expecting us to have to live through," Jackson said.
Dan Cowling, president of The Communications Group in Little Rock, said now is a crucial time for crisis communications, one of his firm's areas of practice. "While every situation is unique, we always begin by addressing three priorities: gaining focus, clarity and simplicity."
David Martin, CEO of Allegiance Consulting Group of Little Rock and a crisis communications expert, laid out his tips for businesses, including the need to "prepare for a new normal," in this commenary for Arkansas Business.
Though coronavirus has utterly crippled some industries like entertainment, travel and restaurants, some marketing analysts predict a quick rebound there, and perhaps in retail, once the threat passes and Americans come out spending with a vengeance. “This could lead to an ultra-competitive environment in later months as advertisers try to reclaim lost market share with a ‘quick-win’ mentality, increasing rates above average due to limited supply,” Ward said, citing Parker’s research.
But timing is the key.
Mike Sells of the Sells Agency in Little Rock noted that “revenge shopping” has been reported in China, where the epidemic began and has been subsiding. A pent-up demand “for goods, services, travel, dining and entertainment” is pushing people emerging from isolation out to spend money and “have some fun,” he said. “Of course, for those impacted financially because of lost wages, that might not be an option.” He added that these are times to be grateful for a diverse roster of clients.
Darin Gray, CEO of CJRW of Little Rock, said advertisers are “hitting the pause button on their traditional media” while focusing on social media messaging. “Companies are using their social media posts not only for advertising purposes, but to also inform and educate their audiences as to how they can still serve clients either through online or limited personal contact.”
The Communications Group in Little Rock got a head start on home productivity serendipitously. Employees started working from home on March 12, said Lisa Van Hook, the firm’s executive vice president and director of client services. “We started a Thursday and Friday test of our tech infrastructure,” she said. “Our test went great and somehow we managed to be busier than we’ve been all year. Little did we know that we would not be back in the office on Monday following the test.”
Van Hook’s PR chief, Carson Horn, said advertorial submissions are down globally, and that the carnage has been particularly brutal, predictably, in the travel and tourism sectors. “Surprisingly, news outlets have felt the hardest and most immediate effects of this situation despite the massive attention they are currently commanding as viewers tune in to stay up to date on events as they unfold,” Horn said, saying that some brands were keeping their distance from most advertising currently “opting to distance themselves from the negativity of the current coverage cycle.”
Big Story, Little Money
Daily newspapers are taking a beating, even as they cover the biggest story in years, with many following the Arkansas Democrat-Gazette’s lead in reducing print production days and opening up pandemic coverage from paywalls that block nonsubscribers from seeing content. The Little Rock paper halted home delivery of papers on all days but Sunday at the first of the year, long before America was confronted with the novel coronavirus.
But the pandemic has accelerated an advertising pullout, putting daily papers across the country and in Canada at the edge of extinction, publishers warned. On Monday, the Tampa Bay Times announced that it would print just two days a week, Wednesday and Sunday. The paper had lost $1 million in two weeks of coronavirus restrictions, Times Chairman and CEO Paul Tash said. “This is also a good time to gently guide our readers toward the electronic formats. We are changing the form of delivery, but the journalism is as strong as ever,” Tash told Poynter media business analyst Rick Edmunds.
Gannett, recently merged with GateHouse and now the largest U.S. newspaper chain, said its USA Today and 260 other daily papers would be furloughing staff members for one week a month while executives also take a 25% pay reduction. Gannett owns the Baxter Bulletin in Mountain Home.
On Tuesday, publicly traded Lee Enterprises of Davenport, Iowa, warned employees at all 75 of its papers to expect pay cuts or furloughs equal to two weeks’ salary. Lee, which owns the St. Louis Post-Dispatch, said its executives would take a 20% pay cut. As publishers scour the recent congressional relief package for possible aid, Lee CEO Kevin Mowbray said “the sacrifices we make now will minimize the long-term damage the pandemic could have on our business.”
Martin Thoma, brand specialist and principal at Thoma Thoma in Little Rock, said that in such a fearful and fluid environment, company messaging is crucial. “Communication is vitally important,” he told Arkansas Business. “Your customers need reassurance now. They need to know that you are serving them … as you adjust to a world of distancing, lockdowns and service curtailments and interruptions. Your employees need the same, and you must make an even greater effort to maintain culture and morale using the most powerful tool you have — your voice.”
Thoma Thoma of Little Rock has ramped up its communications, offering ideas, tips and vital content for clients like advice on online presentations, digital marketing, social media and “virtualizing your business.”
That’s the sort of help Mangan Holcomb/Team SI of Little Rock is offering, including helping clients reach their customers online. A jewelry store, for example, got counseling on setting up a live online chat program, Chief Technology Officer Alex Hood said. “It allows their customers to connect with the people that actually work in the stores,” he said.
‘Quick and Pretty Seamless’
Sharon Tallach Vogelpohl, principal and president of MHP/Team SI, said her company’s shift to remote work was “quick and pretty seamless,” with about a third of the staff working from home even before the virus. The firm has set up zones for those who have to be in the office to perform certain tasks or use specialized equipment, Vogelpohl said. A check-in system allows a single employee per zone, enforcing physical distancing. “Some folks I think are just getting stir crazy at home, so this is an option. We’re all mindful of what’s going on and know the importance of following the guidelines.”
She said MHP/Team SI, as a technology company as well as a marketing agency, is “blessed in that our business for now is as close to business as usual as it could be.” She wouldn’t speculate about any longer-term revenue repercussions in the broader industry, saying any analysis would be premature.”
On the PR front, Vogelpohl’s vice president of public relations, Kristen Vandaveer Nicholson, said MHP/Team SI is “working 24/7 with clients to help them properly navigate and communicate COVID-19 efforts to stakeholders.” From internal communications to crisis communications, she said, “our team has been working around the clock to create and implement communications plans for the next 15, 30, 60 days and beyond. Right now, all messaging is shifting. No matter what industry you're in, it's important to have a plan and be very strategic in your messaging.”
Sells, of the Sells Agency, said timing is crucial for businesses hoping to recover from the pandemic. “If the current shutdown mode gets loosened up by the end of April, I suspect that most budgets will simply be shifted from late March/April into later months of the year,” he said. “For some client industries the financial impact could be severe enough to result in significant budget cuts. But for companies with the resources to withstand the current situation, they will likely be anxious to invite customers back to their stores, restaurants, hotels, etc.”
He doesn’t think digital advertising will get a huge boost, but said ConnectedTV, known as OTT, could get traction from increased streaming by people stuck at home.
Sells laid out the bottom line “for advertisers, agencies and everyone else: Be kind to each other, serve one another, appreciate the small things … and wash your hands!”