Eng
Eng
Reaearch Team Lead
Coronavirus which has been spreading all over the world and making it upside down for three months now, makes practically every field of occupation face significant challenges. People of various professions are already assuming that the pandemic has changed the world and rules of play not only for now. They expect, that still fully unexplored virus can forever alter some behaviors and everyday life of people.
New reality required businesses to provide answers to seemingly already familiar, already answered questions, while marketing as mediator between business and consumer, appeared one of the first on “frontline”. It is assumed that Covid-19 will result in need of updating the role and approaches of marketing so that under force-majeure, companies can better feel consumer’s heartbeat and needs, not only to respond to their requirements, but create this requirement and manage it.
Considering the importance of the topic, to discuss challenges and future tendencies of marketing, ACT gathered professional marketers working in various sectors. What did Coronavirus change? What is now a tendency in the sector and what lost its importance? How did companies adjust to new reality? What new needs does a consumer have? How will consumer’s behavior change in future and how will he try to meet needs? – these were main topics of discussion.
A meeting was held in the form of online focus group and involved representatives of different fields such as banking and gambling business, sales of food products and hotel business. For those who are familiar with Georgian marketing, will most definitely know names of David Birman, Nino Egadze, Katia Absandze, Misha Kurdadze, Lasha Gogua and Khatuna Mamadashvili. Obviously, we could not involve every interesting respondent in the discussion, but the approach ensured to choose field professionals from completely different sectors in order to obtain maximally diverse opinions. The given article briefly reviews results of discussion on opportunities and challenges of new reality which marketing field had to face.
As believed by markets, now, as never, it is important “marketing to stay relevant and minimize “bullshit” in communication”; to adjust to necessary requirements without becoming artificial and losing connecting with consumer. At the same time, marketing today has to explain and financially prove reasonability of every action.
Under these circumstances, one of the main challenges of marketing is believed to be quick digitalization and as noted by marketers, how well various sectors will address this challenge significantly depends on their previous experience and in general, on specific nature of business, quality of digitalization of its work. For example, banking sector appeared to be advanced from this point of view, while quick transition to online space seems problematic in the sector of food products (lack of so called delivery services, unorganized management of stock, etc.). In sectors where digitalization is organic part of process this did not cause significant revision and changes of marketing strategies. However, marketers described digitalization as a quite complex process requiring specific expertise and companies with less experience in digitalization face the need of enhancing relevant resources. As repeatedly noted during the discussion, “digital is not just boosting on Facebook”.
“Consumer behavior will change and business needs to respond to it, it needs to adjust respectively which requires human resource. This is problematic nowadays. And I think that this is the chance for business to use this pause to adapt, adjust… If you see that consumer asks for digital, then provide digital. It just requires expertise how to provide digital”. [Lasha Gogua, “Europebet”].
Another new reality noted by marketers is the requirement marketing to be more rational than emotional. Digitalization itself helped the marketing to be more numbers now than before, because effectiveness can be better measured with digitalization. As believed by marketers, role of marketing will become more practical and they expect more vivid benefits from it.
“Measuring effectiveness of TV commercial has been a complicated task in this country for over 20 years and this is more or less simple in digital. I believe that now is the time for marketing to being speaking with numbers more than it has ever been before… all these image campaigns and steps taken to play with emotions which can equally be pleasant for founder and client are minimized this time and functions directly supporting sales are mostly activated”. [David Birman, TBC, Football Federation of Georgia, Domains.ge]
Marketing was eventually being digitalized without digitalization of product, but now marketers speak about “accelerated digitalization of products, business”; switching to online space as partially irreversible process. Marketers do not expect offline trade to be fully replaced with online shopping, but they all agree that component of online shopping will be enhanced in every sector. This is backed up by their observation that demand on creating online stores and adding completely new functional to websites has increased to great extent.
Transformation period for businesses may impose more radical changes – expansion of their work or revision of profile. As an example of the best adapted businesses during pandemic, marketers repeatedly named Glovo and Wolt which maximally adjusted to consumer’s needs (even with certain technical gaps). As believed by marketers, these companies managed to maximally utilize opportunities – they not only thought about survival, but diversified their offers during crisis and acted as rescues for those staying at home. Example of more radical changes in future may appear some eateries which may enhance delivery service component and completely remove in-house service. In these case, marketer’s role is to feel and predict market’s demand with skin.
Changes resulted from Coronavirus acted as a spur for companies to promptly switch to digital platforms, adjust to e-commerce. However, marketers assessed reaction as partially belated, dictated from outside. They believe that not being appreciative to e-commerce and postponing digitalization process cost businesses lose years. As believed by respondents with more critical attitude, from this point of view, marketers were significantly late in responding to opportunities and “raising the alarm” when they could create this demand years ago.
„I think marketing was late in responding reality in many sectors. Challenge of digitalization was already obvious before COVID-19, but many businesses and many marketers too preferred to remain in traditional format. For instance: we see the development pace of e-commerce service, this service was available before, but many companies did not even have website in their priority not to say anything about e-commerce and delivery. One more observation is that players of the sector need to develop the sector, every player has its share of educational and innovative role. These insights and signals were a bit forgotten but clearly sent by the market but responses were made to so many things only after bumping into the crisis”. [Nino Egadze, TBC]
Professionals of marketing field speak about re-consideration of the role of marketing, its organizational function. This is one of the key challenges of modern marketing and at the same time, inevitable outcome. Marketing has become greater part of organizational structure, expanded its objectives and to some extent, got involved in “execution” processes too. Marketing does not exist independently from other organizational units. It more often has to unite consumer experience, brand, management, digital and non-digital communication; it does not view events “in narrow marketing perspective” but is a part of broader picture. Marketers more often consider marketing as functional and effective in tight cooperation with other units. From this point of view, the most serious challenge for companies may become finding professional and multifunctional staff. Depending the level of the respective staff on the market, companies will make decisions what competences to develop on their own and what services to buy.
„Marketing will play altered role in the company… there were companies not aware of digital, not aware of the function of marketing. They said it is simple to respond to messages in Inbox of Facebook page. There are companies where marketing and sales do not work together, without realizing that every penny spent is a big support for sales. Every department works in the company, each of them has their goal, so it will be much more united now, marketing’s function will become wider and other departments will probably appreciate it more…” [Katia Absandze, Le Meridien Batumi”]
On its part, marketers have hard time predicting how consumer will change after pandemic hurricane goes away. They noted that to do so, marketers have long observation ahead. However, in this case too, they agree that business will play important role in “growing up” the consumer as business creates demand and draws interest of a client.
It is believed that it’s still early to observe any specific changes in consumer behavior. It is hard to predict, because of euphoria of the given period on one side and on the other side, impossibility to foresee what habits will be forgotten by consumer and which of their current behaviors will “turn into a habit”. However, what marketers can clearly predict, is increased use of digital services as trust towards them will increase during this period and respectively, demand will raise in future; marketers expect that behavior of spending money online will reinforce. Each of us may feel the result of this – for example, by minimizing the need of receipts, when paying utility bills online will become a routine for people. This perspective may feel a bit strange now, but an example from nearest past makes it fully realistic – how taxi drivers who were used to completely different reality promptly headed over to online apps and turned them into integral part of their work.
„I think it will be a new mix of online and offline judging from what happens now and what we are observing. People who had problems with digital now get known with it. Us, who use digital cannot imagine that someone does not use it, but now is such a crisis, people are getting familiar with benefits of digital who were afraid of it in the past, I mean they had hard time spending money online”. [David Birman, TBC, Football Federation of Georgia, domains.ge]
Marketers are even more careful to discuss and practically unable to predict what changes consumer’s lifestyle may endure. For example, no one can tell whether abstaining from ordinary leisure (attending concerts of football games) for months will leave consumers loyal to once favorite activities or not. It is even more difficult to tell how consumers’ needs will change to not emotional, but more rational needs. For instance, will consumer who are thirsty for face-to-face interaction will eagerly attend physical trainings or seminars or will they prefer to participate from online space already turned into a comfort zone and save money. Marketers predict altered habits of consumers, but no one knows where it will bring us to.
The universe is still carefully observing spread of Coronavirus and changes resulted from pandemic, but this situation, together with lots of difficulties, may become a source of opportunities and inspiration as well.
*ACT continues series of meetings with professionals of various fields, stay tuned for our next article on Georgian brands engaged in export of their products and services.
Evolution progresses in spiral way, which means that the mankind moves forward and development stages repeat themselves or are very similar to each other. In 21st century, on the background of growing technological and personal development achievements, equipped with personal computer and smartphone, human had to lock himself in “the cave” again and this way, we temporarily stopped and only on expense of intellectual resource, kept developing the idea of inhabiting parallel planet to live. People hope to get routine everyday life back where one has breakfast in the morning, then heads over to work, then goes to café for lunch, from work to market, from market to home, from home to a bar and then makes breakfast again in the morning. Humans have been building this simple life chain for centuries, eventually developed it and now nobody wants to start over. Pieces of the chain are tightly connected and are independently operational units, small, medium and large business fields the majority of which are now in waiting mode. We were interested to find out whether the perception of social responsibility has changed in the crisis or not. We conducted in-depth interviews with representatives of companies of different size operating in Georgia, based on which we created the following anthropological picture of perceptions:
1. In own cave
Sense of danger and unclear situation outside, made human find a shelter in the cave and return back there every time as he already knew the way. Having a roof as an opportunity to protect from natural conditions and hide from outside threat, brought a human the feeling of getting used to own place – one specific environment and he found more or less calmness in this environment. People left alone because of the pandemic headed over to their homes – their forever and well-known cave. Corporations are managed from homes, so in the beginning of the crisis, companies used one of the topical, practically inevitable form of social responsibility – to “transfer” employees to their homes and made sure they stayed there. According to inquired respondents, they made the decision of terminating their work in real regime and switching employees to remote mode alongside the recommendations issued in the country. Quality of social responsibility is determined based on when the business implemented the said – when the relevant recommendations were issued or when the pandemic was already severely spread. But for now when every corporation whose work can be done remotely at least partially, tries to manage remote work of their employees in a way not to lose the sense of team work neither to decrease the interest towards work. This form of corporate responsibility is ultimately based on caring for health of one person and has various forms in various corporations – this could be social package of unified insurance developed in the crisis or equipping employees with protective items at home or organizing special trainings so that when performing work (signing agreements in old form) their health is maximally protected. The least company can do to this regard is to provide licensed version of Zoom meetings absolutely necessary for remote work so that employees can easily work from home.
2. The scene of hunting mammoths
After getting known with the cave and settling down in it, man started using this cave as a mean of communication. First historically proven ancient drawings on cave walls depicted what man saw and did beyond the cave. Man used to scrap mammoths on cave walls for two reasons – in order to classify (in simple form) i.e. to distinct mammoth from tiger and in order to share it for others. Depicting actions helped human to better plan hunting, have better perspective of animal anatomy, simple ways of hunting them, to do its job properly. To become a “professional” and then share this plan and knowledge with others so that others could hunt better too. In this context, revaluation of social responsibility is defined with the motif to save yourself, to continue work in future and to save neighbor companies as hunting is better together, chances are higher to hunt bigger animal and survive if attacked. As believed by inquired representatives of businesses, influence of international B2B corporate responsibility is eventually taking its position in Georgia. The majority of respondents representing large businesses emphasize importance of supporting quick development and sharing specific advices in crisis, necessity of which drastically changes in narrative of small business representatives. Respondents confirm the assumption that in this context, small and medium size business are most vulnerable, this is why social responsibility of large business is to offer them support. From Georgian reality, so far these are only a few examples such as support in establishment of e-commerce platform or providing consulting on business matters. Launch of ACT business consulting platform served exactly this purpose – to share our knowledge and experience to those who are in desperate need of our support now to survive in long-term perspective and to turn into large companies commissioning us after this crisis so that we hunt down mammoth together.
3. Shared bonfire
After discovering the fire, man started using it for different purposes. In order not to lose time for starting a fire every single time, he tried to have it on all the time. As together with people “making friends”, perimeter of the caves narrowed, fire appeared in the center of the caves and each member had the responsibility to keep the shared bonfire on. The most frequent and prevalent form of social responsibility is to contribute in this common bonfire, if we imagine that fire is country’s economy or common welfare, corporate responsibility of company is to support separate segments of the society around this common fire (to help vulnerable groups, to support sport or cultural activities). During Covid-19 crisis this had a form of creating unified platform of fight against pandemic and millions of GEL transferred to it. Corporations donated money for common welfare. In addition to this, in separate cases companies financially supported or if relevant to their field, provided their product (food, fuel) to National Center of Disease Control and Infectious Hospital as frontline units in fight against Coronavirus. As explained by companies selling construction and oil products, such purposeful use of money simplifies engagement in social responsibility activity and ensures them from making a mistake – define the most vulnerable group and its needs in this crisis. This form of CSR, similar to its symbolic face – fire, has an effect to spread, on one side, it sets an example for other corporations and motivates them to donate money to cope with the common enemy and on the other side, if we generalize on the example of the specific construction company, CSR can be implemented through such activities which could involve not only corporations but ordinary citizens while business would act as a mediator. For instance, if you purchase real estate under the promotion, part of the amount you pay will be transferred to Covid-19 fund.
4. Thigh bone
A student once asked famous American anthropologist Margaret Mead what she considered to be the first evidence of civilization. Among expected answers from scientific point of view student considered that Mead would say clay vessel, hunting tools or fire as a mean of communication, but anthropologist answered: a human thigh bone with a healed fracture found in an archeological site 15, 000 years old. This bone is the largest in human body, forms the hip joint which is absolutely necessary for a human to walk, if fractured, this bone needs average 4-6 months to heal. As explained by Mead, when an animal breaks a leg in wild nature, he dies because he cannot hunt for food, cannot move to escape from the attack, is unable to find water. Mead points out that healed femur fracture tells us that someone spent time and resources, took care of the person in need, healed him, brought him food and water, and protected or moved to a safer place before he was healed. This is where civilization starts – with healed femur fracture – with care for others.
Revalued perception of corporate responsibility which changed from simple one-time charity to taking care of employees, sharing knowledge and experience with others, and providing purposeful funding for activities oriented on common welfare, is eventually developing in Georgian reality, but we believe that first sign of civilization for social responsibility is corporate healed thigh bones – those employees whose jobs could be preserved and who will return to workplaces after the crisis is over because they were not abandoned in time of need and were taken care of; because exactly healed femur fractures will be counted after Coronavirus is over, this will be a measure of moral damage done by the pandemic beyond human lives and health and each of us will think about how many healed bones are on us.
Corporate social responsibility (CSR) is often a topic of discussion for business circles as well as for broader audience. This topic is particularly important today when the world is united against one common challenge- fight against Covid-19.
Clearly, governments are obliged to do their best to fight against pandemic, to save lives and keep economy going. This is their core responsibility. However, as demonstrated by this process, effort of officials is not enough to tackle the situation. While #stayhome campaign requires responsibility of each citizen, it is interesting what is the role of business in fight against Covid-19?! What does companies, as parts of our society do for common good? Or what can they do better?
According to webpage created for the purpose of preventing spread of Coronavirus in Georgia – Stopcov.ge, 170 companies operating in Georgia already demonstrated high social responsibility in the process of fighting against the pandemic. Amount of money transferred to special foundation created for the purpose of Coronavirus prevention already exceeds 131 million GEL. This clearly is something to appreciate but Georgian companies did not express their social responsibility only in this form. There were quite many companies engaging other activities under social responsibility – including profile activities (e.g. providing doctors with food or fuel; restructuration of loans, etc.) and activities out of their profile. It is a pity that in some cases, due to insufficient communication, socially responsible steps of these companies could not reach consumers and took away the opportunity of establishing positive reputation based on reciprocal usefulness.
In addition, it is worth mentioning that Georgian society, including consumers of specific brands are quite critical towards social responsibility exercised by large companies, intensiveness of charity activities carried out by them. To put it in other words, consumers set much higher standards of civil sense to businesses than a large portion of companies imagine.
We often talk to consumers to evaluate image of leader companies in various fields and their work in general through focus groups, telephone or face-to-face inquiries (note: this form of inquiry was completely replaced with telephone method in ACT due to new agenda set by Covid-19) and here is what they tell us:
,,I try to be and cooperate with companies which have high social responsibility and does at least something to help Georgians, tries to help and make improvement”. [Woman, 26 years old]
„Commercial organizations do not feel certain idea. Their main idea clearly is to earn as much as possible, get more profit, but we should not forget social responsibility”. [Man, 37 years old]
Together with meeting basic steps of social responsibility, important component of brand’s reputation is believed to be other benefits brought to broader society.
Basic steps of social responsibility include:
Upper levels of CSR impose broader, more global responsibilities to companies, as integral parts of our society. Such approach is called civil sense of business or corporate citizenship which implies effort to improve economic, environmental and social situation of the community where business was founded and/or is in interaction considering other factors. In Georgian reality, due to smaller area of activity, this community implies entire country and its residents. Respectively, business is challenged to offer types of activities which will be vivid and at the same time, useful for entire Georgian society or any group of it.
It is also worth mentioning that consumers’ memory on the projects implemented by Georgian companies under CSR is quite scarce and is mostly limited to charity projects. Furthermore, there is perceived severe social condition of the country and thus, desirable directions of CSR ultimately imply charity and more specifically, sensitive fields such as funding for cancer patients, allowance for socially vulnerable families or children. Considering high sensitivity of society and urgent need, we can also include monetary transfers made to Coronavirus prevention fund under this category.
However, respondents separately mention need of campaigns with long-term effect in the fields which will bring broader benefit to the country and society. These fields are perceived to be education, investments in technology and economic development. In Georgian reality, tourism and agriculture are particularly sensitive fields of economy.
It is important activities implemented or planned under CSR to comply with three main criteria defined by final evaluators – consumers:
Considering inevitable regress of our economy due to fight against Covid-19, we can clearly say that preserving country’s economic health is no less important challenge than coping with a virus. Regardless the steps made by the government and international donors, business initiatives in this field may act as important boosters of economy. This can become the position business should pick in order to more effectively manage utilizing its potential under this crisis to benefit the society.
Our new reality is very much alike if you get up 15 minutes earlier to work day, go to “home office”, work, mix personal and work time, head over to your own kitchen during lunch, come across with shopping list when working on projects and mostly spend your weekends on the balcony. New reality makes our behavior and work principles homogenous. In the environment where homes are turned into offices a circle is formed where routine is repeated every day for everyone. How is it possible under these circumstances to keep your work motivation or even increase it?
When speaking about motivation, we most definitely need to mention Abraham Maslow, founder of motivation theory, whose pyramid cannot be avoided by any organization. On initial stage of keeping employees motivated, Maslow considers basic needs: physical environment and safety, following level is taken by psychological needs: belonging, love, recognition and finally, he sees the need of achieving one’s full potential and self-actualization.
According to Maslow’s hierarchy, organizations that fully meet employees’ needs from basic needs to top level, significantly increase their motivation. However, this classic model was altered by the pandemic. Now, employees who had their physical environment covered in terms of basic needs, have an upside down situation: they make stocks of food, pile up hygiene and medical products, stay at home and take care of their own and family member’s health. Under these changes, pyramid is completely altered and it becomes necessary to discuss changed tactics of employees’ motivation.
In Georgian reality, “upside down” pyramid appeared to be most simply adaptable for those companies whose organizational strengths became transferable into remote service as they already had digital processes well-established. To motivate employees, these and other companies had to make decisions based on the stage where large portion of their employees were at.
We are sharing an example of our organization – ACT, how it manages to preserve the bottom level of pyramid so that based on the central part, it supports lower and upper levels and respectively, increases employees’ motivation.
Love, friendship, family, belonging – central part of the pyramid, psychological factors largely affect motivation of employees. As far as ACT’s management follows direct, consistent communication, uses open, free, less bureaucratic approaches, acceptance of their decisions is already quite high. In addition to this, the majority of employees has long history of working for the company, thus, the feeling of love and belonging, supporting each other stands high on psychological level. A feeling of belonging is enhanced during a crisis, when people love to be united, to be in the same boat, this strengthens them mentally and simplifies acceptance of novelties, new initiatives. Being united against the problem from the company’s perspective is perceived as ultimate motivator, while being united around the idea is a powerful tool in the pursue to achieving goal.
Physical environment – new fears emerged in terms of physical level: preserving a job, salary, mobilization of finances for meeting basic needs, physical place to effectively do your job. These fears compromise lower level and to terminate this, organization needs to have timely and right communication with employees. To address this problem, ACT made certain changes in terms of staff/salary, which resulted in preserving jobs for every employee. This decision, on one side eliminated fears in terms of safety and physical environment and on the other side, on central level, built level of basic needs on membership of one big family. Employees became motivated to create safe working environment for them and their colleagues, thus, the company shortly became entirely digitalized.
Self-actualization – some of ACT’s employees were on the level of meeting the need of self-actualization, while part of them, with right allocation of resources, were given a chance to show off their “hidden” skills during the crisis. Opportunity to demonstrate their potential additionally motivated people to receive recognition from colleagues and level up to the last step of pyramid where by fully realizing their skills, they could turn the challenge into an opportunity. Clear demonstration of this is a new consulting platform of ACT – www.act-strategist.ge formed with the idea of supporting other businesses under corporate responsibility.
When evaluating the steps we made, organization was able to obtain a larger picture through a feedback tool (internal study), based on which motivation of employees has remained the same for 57% during crisis considering the decisions made by management while motivation increased for 33% of employees. Inquired staff members also believe that changes will not affect company’s work: on expectation level, they perceived that company would work in regular regime, while they feel optimistic towards the future operation of ACT. As verified by this example, if psychological needs are met, organization culture and feeling of being united is in place, building values on them becomes quite easy, which is particularly important during crisis.