Reflecting on the past few weeks, the current crisis we face across the industry is still to completely sink in. We have quickly moved from running a successful business, employing hundreds of people and managing the logistical and operational challenges of feeding and watering thousands of people each week, to suddenly becoming experts on furloughing and cash flow statements. 

In February we knew the industry could be facing a difficult period, so as a precaution we introduced some controls around unnecessary costs and spending within the business – a ban on capital expenditure, strictly controlling all purchasing and putting a stop to anything that wasn’t absolutely necessary to run the business. 

Moving into March the situation quickly worsened on a daily basis. Was coronavirus going to affect trade? By how much? Surely we won’t have to close? So many questions and uncertainty, made all the more difficult by the prime minister telling the country not to go to pubs and restaurants, but not closing them down. This was especially difficult to rationalise. 

Having been in crisis mode for a few weeks, only now have we managed to move Buzzworks into hibernation – both operationally and financially – while being able to take stock of the situation we are in.

Throughout my career, building Buzzworks alongside my brother and sister, I have drawn inspiration from Danny Meyer, New York restaurateur and chief executive of Union Square Hospitality, both for his vision of “enlightened hospitality” and the way he prioritises the stakeholders within his business.

Having not only read his book, I was fortunate enough to visit his business for a week last year through a HIT scholarship, to immerse myself in Danny’s philosophy of “enlightened hospitality” – a framework of how you priorities your business stakeholders; by putting your people before your customers, your guests, your suppliers, your community and your investors or owners. I understand the difficulties a situation like this presents to business owners within the hospitality industry both up and down the country and indeed the world. Hospitality at its core has a disproportionate reliance on people, allied to high property costs that makes it incredibly vulnerable to a complete closure like we are experiencing now.

No one could have envisaged this situation and for many, it would be all too easy in such a crisis to leave your staff in the lurch, cancel all payments to your suppliers, stop giving out to your community and to abandon your guests entirely.

Throughout this situation I have looked back at my time at Union Square Hospitality and tried to implement what I’ve learned. The “circle of enlightened hospitality” requires each stakeholder to be looked after – if you break the circle anywhere, then you break the whole thing. That leads to taking some decisive and difficult decisions. 

Our focus on people became a guiding principle on how to handle this crisis. Before chancellor Rishi Sunak announced the Coronavirus Job Retention Scheme (CJRS) we spent hours discussing what could be done to lessen the impact of the downturn of business on our people – working out how long we could pay them before we had to preserve our cash, just to keep the business alive in the long term.

A daily communication was provided to our team from myself, outlining the facts of the situation and how it was going to affect everyone who worked in the business. This served to at least keep everyone informed of our intentions and help stop rumours and misinformation that could potentially spread within a business of our size.

Once the chancellor made his statement regarding the CJRS on Friday, 20 March, it became clear the government was going to step in for people everywhere. We have subsequently furloughed all of our staff on 80% of their wage – irrespective of what they earn – and have the resources to make sure they get paid weekly until the government begin to reimburse us. 

During the start of the crisis there were lots of discussions around takeaway and it seemed everyone within hospitality was somehow going to turn their business into some sort of take-home business. 

We have two venues with a takeaway element, but we decided to close both only two days into the lock-down. The reality is unless you were already set up to do so, and a big part of your business comes from takeaway, then the economics just don’t work – especially when your staff could be safe at home and still earning a decent wage.

In the two weeks leading to lock-down, we were constantly reassuring our customers everything was being done to help minimise the risk for them to visit one of our venues, and since closure we continue to “keep in touch”. We are preparing a plan to increase customer communication over the next phase of the lock-down, right up until we are able to safely reopen.

Once our people were being looked after, our full attention was turned to cash flow and costs. The goal was – and is – to get costs as low as possible and effectively put the business into a “financial coma” – stopping and reducing every cost that leaves your bank account. However, that does not mean turning your back on the people that supply you.

When it comes to suppliers it is all too easy to hit the “cancel” all direct debits button and switch off the phone – just tell your suppliers you will see them once this is all over. I certainly advocate being in absolute control of the money leaving your bank account, but we have found if you just speak to your suppliers they almost universally understand and will offer some sort of concessions on time to pay or deferral – that also includes your landlord if you have one. 

We are both tenant in a small number of venues and landlord to some commercial property, including a hotel, so we understand the issues from both sides of the fence. I am pleased to say through some kind gestures on all sides, there have been concessions made to both us and our tenants.

We are continuing to pay our suppliers, albeit not exactly on the same terms as pre-crisis, but they will get paid. We have two lists on the wall in the office – one is labelled “good guys”, and I am glad to say it’s a very long list, with Tennent’s at the top due to not taking their last payment until the crisis is over. It goes without saying people never forget the good guys. 

Then you have the other side of the coin – those that fall short – these are the companies that have refused to make any adjustments to their costs or credit terms. I am pleased to say we only have one company on that list – so much for all being in this together. They will shortly be an ex-supplier.

I feel proud we have been able to support the community through donations of food and volunteer work, with our chefs cooking meals for those in need through local charity Centerstage, along with many other team members volunteering for local good causes and the NHS. We have also continued to make some modest charitable donations, most notably to our main company charity, Hospitality Action, which provides a variety of support for people in hospitality across the UK. 

Our owners or financial stakeholders 

The last part of the “circle” is the actual business. No business can survive indefinitely without income, so we have to manage our cash flow carefully through forensic control of every penny that leaves our bank account. It has been a flurry of activity creating multiple cash flow models ensuring in six weeks, three months, six months, one year down the line we have some liquidity and can continue trading. 

No one really knows what the landscape is going to look like when this crisis is over or even when the lock-down ends, and everyone may have to make some difficult decisions to protect your business, so you have one when we all return to some sort of normality.

Most businesses that have been in and around the industry for as long as us will have their own war stories to tell, and in more than the 40 years we have been operating there has been an abundance of ups and downs, although we have never seen something quite like this.

It is through these fair share of knocks though we have the confidence to ride this storm, having built a strong business to manage the financial impact. Perhaps, due to being a family business, we have also always pulled together when our backs are against the wall and this crisis is no exception.

Our goal throughout this whole extraordinary situation has been simple – to treat everyone fairly, to protect the business and in a year from now to look back at our actions during this crisis and be proud we did the right thing for everyone involved. 

I can’t believe it’s three weeks since I wrote about the first three weeks of coronavirus and the effect on Malvern Inns. For me the new life is settling into a new kind of normality. 

I have a daily conference call at 8am with my directors of the software business, and a call at 10am with my business partner in pubs, David Roffe. My morning consists of working from 7am to 11am, when I then have an hour off to look after my three-year-old and give my wife a break. I’m then back from noon until-5pm when I stop, do the garden, and then head up for bath time and cook a healthy supper. I have lost a stone in the past six weeks as part of my “ready for the virus” plan. I still find every excuse not to go for a run! I am in the middle of writing a book, which is starting to morph from the equivalent of a film into a mini-series. Don’t get excited, it is on the riveting subject of labour management! But I am busy and now feeling more positive about trying to make all of my businesses more successful when they spring back to life from their relative states of dormancy.

This week was about resetting our minds more than anything else. What are our cash balances? What are our costs of holding the business on closed? What level of business interruption loan do we need? Do we want to keep all of our businesses? What might our landlords do? How do we see the future when we come out of this?

We have come out with a small amount of cash but not enough to pay April salaries, so that is a concern. Our ongoing running costs of the business are low, so we can survive through to reopening. But the way we all run our business is on credit and using this week’s sales to pay last week’s bills, so if we don’t take any money the house of cards falls over pretty fast. This week is all about trying to get answers to all those questions, as well as:

– Furloughing the staff – we didn’t issue them letters because there was too much uncertainty, but did the following week.

– Figuring out how we could keep our sites safe. With only one live-in manager the sites are at risk, but as we have furloughed all staff, how do we ensure the sites are safe and not broken into?

– Figuring out what to do with the one salaried team member who joined after 1 March. Luckily he is a great chef who we can use, but more of that later.

This week is busy trying to understand how cash actually works when you close and reopen a business. What terms might suppliers give us and how much cash do we need? How aggressive should we be with our landlords – Punch and Heineken – that at this point have been silent? The area managers were not able to give us any answer because understandably the seniors were thinking it through, and probably more importantly calculating the cost of going rent-free, and the cost of not going rent-free, which would presumably be worse.

We found, to our surprise, if we closed the pubs we would owe £200,000 – almost £70,000 per pub. This is a calculation I have never done in my business life and I was surprised by the answer – of course I hadn’t saved for this eventuality. Given the costs of £10,000 per month of being closed, even with no rent and rates, we thought best to go for £250,000 of loans, which is of course just under the threshold for personal guarantees. We then had conversations and submitted applications to our two banks, NatWest and Lloyds.

It is only last week where we really started to get back to thinking about how we might reopen. What opening hours might be legislated? What social distancing measures might the government or our customers want? How might we run the business in these circumstances, and can we run it effectively? What levels of trade might we open at – less or a lot less? How might we communicate these to our customers? We have decided to write a plan for all of this, which we have started but not finished.

We have started to think about furloughing and training. Because you can train staff while on furlough this gives us all an opportunity to train our staff for the conditions when we reopen, and also potentially do some training in areas that we had wanted to do anyway. Again an important area we are thinking about, but no decisions made. And we are starting to think about new menus – because we think one of our menus was not good enough, and when we open we need to be prepared for a shorter menu and one we can deliver either as suppliers or our teams get up to speed potentially with very short notice.

We are also now starting to look at all the things we could do better if we have the time while we are closed. And we had an update from the banks – NatWest has been exceptional. It is going to allow, I think, us to pay our staff using an increase in our overdraft facilities, and it has verbally agreed to an £85,000 loan for one of the pubs. We now have to chase Lloyds for a loan on the other two pubs.

Oh, and finally, our landlords came back to us. Each with a different deal but one we think we can live with. We now need to have discussions about opening rent!

Life has definitely moved on. We should be wary technically furlough pay only lasts until the end of May, and also what restrictions will be placed on us when we reopen, and what state the economy will be in, but we do believe we can succeed in the new world. And one of my best friends is out of hospital after spending ten days there with coronavirus – he is on the mend. I am convinced he gave it to me. I had a mild version and now have the antibodies – ever the optimist. I am really energised to make this whole thing work and come out a bit stronger, a bit better, and a bit lighter!

“I feel sorry for the lime growers”, said one seasoned industry wag, referencing the wedge of lime put in the bottle neck of a Corona beer. That not particularly amusing throw-away line was said at a time when news of coronavirus in China was just breaking and the sales graph of the Anheuser-Busch InBev-owned Corona beer was just beginning its journey downwards. That seasoned industry wag was me. We were at the stage where at meetings and conferences we would still get vague amusement from elbow bumping or tapping feet instead of shaking hands. No one in the hospitality business, at that very early stage of the crisis, realised the sheer enormity of what was about to descend on our world, or for that matter descend on the whole world. 

Those recent days are now long gone and in a relatively short space of time the penny dropped this could get serious. Boris Johnson told the nation we should “avoid pubs, clubs, theatres and other such social venues to minimise suffering and save lives”. Things were indeed getting serious. 

I called a meeting with four of my senior pub managers to gauge their opinion. The meeting from the offset had a very serious tone and there wasn’t a hint of mild amusement from elbow bumping. One, a people-focused manager of huge integrity, looked me in the eye and his serious and concerned look told me all I needed to know – my senior managers were willing to close their pubs to protect themselves, their teams and their customers. Not only were they were prepared to close, they were prepared to suffer the consequences and whatever this may mean for their livelihoods. (Remember, at this stage “furlough” was a word none of us had used). 

To my mind the decision was made there and then at that meeting – all our pubs must close, immediately. To make this happen I had a hurdle to cross. While I was managing director of the company and chief decision maker, a decision to close down a business of 15 pubs, at a time when the government was not demanding closure, had to be referred to the owner and founder. Entrepreneurs such as our chairman are made of strong stuff; they are cut from a certain cloth that usually advocates: “Keep the business running at all costs.” In all honesty, I expected I would have to draw on all the persuasive techniques built up over the years. However, circa three minutes into the call, my decision has been rubber stamped, I bid the chairman well and I was then phoning each pub instructing them to shut immediately. We closed our business in its entirety 48 hours before the government told us we had to and I am proud we did. We were genuinely thinking of our people, our customers, and our suppliers. We made the right decision. I can sum up the feeling of closing the business in a phrase I never thought I would use – the silence of tills not ringing gave me an enormous sense of relief.

I would love to say as an industry we all took the decision and acted with integrity and courage, but the harsh reality is we didn’t. Yes, companies such as Brewhouse & Kitchen and Darwin & Wallace did, but so many didn’t. How can this be? The hospitality sector is virtually the dictionary definition of a people business, yet there is example after example of profit before people. One industry leader said the ”‘virus doesn’t spread much in pubs” and kept his tills ringing. Others, just kept calm and carried on (carried on serving that is). Some senior leaders dithered, one for example deciding to close their London pubs but not those outside the capital (as if a virus could not travel to the rest of the UK). One company put out a heartfelt message stating “in the interest of our people blah blah blah we are closing our businesses”. The reality – it kept three of its businesses in higher footfall areas open. 

The industry fell in to three camps – the defiant, the ditherers, and the doers. I for one am proud to be in the doer camp. Of course, there is serious backtracking now, as the defiant and the ditherers try to either justify their defiance and dithering, or try to rewrite what actually happened. Many will emerge relatively unscathed after the crisis as customers have short memories, but deep in their own hearts the defiant and the ditherers know they got it wrong. 

On a more positive note there have been some tremendous examples of the hospitality industry coming together at a time of crisis. Anheuser-Busch InBev has produced gallon after gallon of hand sanitiser while Diageo has been a rock by helping in ways too numerous to list here (it was good to hear Dominic Raab sing their praises at a recent press conference). Of course, individual pubs have been doing what they do best – being a pillar of the community, despite being shut. They are checking up on, and looking after, their regulars, bringing them together with online quizzes and dropping off food on the doorsteps of our slightly more vulnerable customers. It is right to say there are examples of kindness oozing out of every pore of our industry.

And so, to the recovery of the hospitality industry. We will be ready and waiting for our wonderful customers to return and we will welcome them back with open arms, with hugs and kisses for those that want them, and virtual hugs and air kisses for those that don’t. As for me, my part in kick-starting the industry – when the time is right – will be starting a Change.org petition aiming to get (the by then fully recovered) Boris Johnson to instruct the nation to “visit pubs, clubs, theatres and other such social venues with great gusto”. 

Our industry will bounce back but a message from me to the deniers and ditherers – in future, please look after your people and our customers a little better.

There is a sense, albeit extremely tentative, some operators can see the end of the lock-down road and are beginning to plan for it. Reopening could be six weeks away very optimistically, ten weeks away optimistically and 14 weeks away perhaps realistically but no one really knows. It does feel in sight though for the first time since mid-March. However, the widespread view of the market is it is unlikely to recover to previously seen levels – if at all – until mid-2021. 

I sense some operators this week have had, at last, some time to catch their breath and to think in depth about the future and strategy of their business for the first time since this crisis began.

The hit has been continuous and relentless – developing new health and safety processes to keep teams protected, redundancy planning, the move from redundancy to furloughing, keeping some sites open for delivery and takeaway, closing all sites, negotiating quarterly rent and service charge deferment, tronc inclusion/exclusion, and navigating loan availability. Constant change has become a way of life and will be for some time to come.

It is quite incredible how many operators have been supporting their communities, and the NHS, in the form of free food and drink. This takes an enormous amount of effort, time and determination. Their overwhelming kindness has been amazing.

I have read numerous papers and reports on the subject of change and strategic responses to the need for future change. I have listened to a lot of podcasts, watched a variety of TED talks/videos and spoken to many operators to understand some of the key emerging themes around rapid change, and the imperative to plan in a time of crisis. Some common strands that have emerged in terms of planning for the future have been:

– Understanding what this means for a brand post coronavirus – strategy, positioning, offer and communications.

– Trying to appreciate the future potential behaviour of current and new customers. 

– Analysing competitors – exploring where a brand might fill a void and/or make the most of opportunities.

– Assessing potential number and location of sites and developing options for reopening.

– Considering all potential funding and finance options including administration and company voluntary arrangements.

– Removing as much overhead as possible now – office, marketing, call centres and people.

– Driving digital and online momentum and change – hard and fast and at minimum cost.

– Communicating consistently and comprehensively with teams and customers.

– Seeking potential partners to share thinking, costs, people and best practice. 

– Significantly upping the pace and scale of innovation, radical solutions and “out of the box” thinking (I hate that phrase).

The situation is rapidly changing as are the priorities of operators – they have moved fast. Some of these actions will become features of future business life:

– Decisions are being made infinitely quicker than pre-coronavirus. 

– Liquidity has always been essential – this crisis has been an eye-opener for some.

– Teams have worked together brilliantly for one common purpose – no time for department squabbles.

– Organisations have had to become incredibly agile and will need to stay agile – no complacency. 

– Individuals will have to become more agile, be prepared to multi-task and to reskill/learn new skills.

– Disruption has become a way of life. There is no norm to fall back on. Scenario planning has been vital.

– The industry, always good at working together, has naturally shared learnings.

– Kindness and “thinking of others before yourself” has become a natural way to behave for so many.

– The sense of community has become stronger – shared stories have become the stuff of legends.

– Working from home has worked. Trust has been key. This will become a new norm for many. 

– De-risking the future is on many board agendas. 

I could go on. There’s so much to listen to, so much to learn and so much to change. No words can describe how awful the impact has been on society – and on our own sector. Operators are learning as they go and demonstrating true kindness and generosity of spirit as they do. Amazing doesn’t begin to describe them.

It’s been four weeks since the rug was pulled from beneath an industry already standing on very shaky ground. I won’t add to the commentary around how restrictions might be lifted, but it’s clear the businesses that make it through these next few weeks face a cocktail of challenges. 

With homeworking likely to be the norm until a vaccine becomes widely available – meaning fewer people travelling into city centres – many brands will see their flagship sites under-punching for months, or even years, to come. 

Habits have been changed and the reset button has been hit. A £4 coffee each morning might seem like an unnecessary luxury again as the financial implications of lock-down hit. And as people have re-engaged with home and family, eating and drinking occasions that were previously automatically conducted in restaurants and pubs might well have found their way home again. 

And many consumers will question their choices. Whether that’s as a continued shift to shopping locally again, or being more conscious of the true value of their dining out experiences. People with less money, and a renewed view of what’s important, will be mindful how they spend their cash too. 

But amidst these changing circumstances, when restrictions lift, recovery and even growth is possible. But the size and as yet unknown nature of the challenge ahead means we need to forget much of what went before. Here are five things you need to be doing now. 

Even some of the big brands have pulled the plug on their social media – presumably to (understandably) save money – but it’s absolutely essential your brand stays front of mind. We’ve somehow forgotten this in our obsession with “like-for-likes”, but marketing is as much about long-term emotional connection and influencing future behaviour as it is about driving people through the door today. You may have nothing physical to sell at the moment, but use your brand’s unique tone of voice to maintain engagement. The brands that are finding authentically creative ways to stay part of the conversation now, will be the first places on people’s minds to seek out when restrictions start to lift. The quietest brands may well not get on the list. 

And don’t just rely on social – focus on your local SEO strategy now, because SEO can take weeks and months to translate customer interest into covers. As Matt Goodfield, chief executive at SideDish Media, says: “With the cost of SEO being at an all-time low, now is the perfect time to invest and plan, to make sure you reap the rewards and hit the ground running once the market starts to reopen.”

I’ve frequently spoken of marketing’s frustrating lack of credibility within hospitality. Consistently poorly understood and utilised, it’s not surprising it’s the function most likely to be driven by stakeholder subjectivity, rather than hard fact. 

From the largest businesses to the smallest, marketing is driven by gut instinct and subjectivity more than any other function. But the time for non-marketers “dipping their toe in” or having a go at marketing as light relief after a hard day of whatever the day job is has to be behind us now. 

Your marketing team must be given clarity of your business’ immediate commercial goals, the space to plan their response to that challenge, and then to be held accountable for delivering or evolving it. That is simply not possible when marketers are not given complete and consistent ownership of their function. 

Mark Ritson (professor of marketing and regular columnist in Marketing Week) stated last week the best marketers will be upping spend not cutting it. Now, while we might feel that’s all very well for sectors that rely less heavily on physical footfall, such as retail, spending the right amount of money in the right places now could ensure we in hospitality bounce back faster and stronger than had we not. 

However, investing increasingly precious cash can only be done confidently by those with the experience, vision and insight to navigate and mitigate the risks. In their 2010 article titled “Roaring Out of the Recession” in the Harvard Business Review, Ranjay Gulati, Nitin Nohria and Franz Wohlgezogen noted only 9% of the 4,700 companies they analysed managed to emerge from a recession in better shape than when they entered it. And one of the key hallmarks of these successful firms was a “Janus-faced” ability to cut budgets in some areas while continuing to invest in marketing and advertising.

If you don’t have a deeply-skilled senior marketer with a strong understanding of digital and data-led marketing, it’s not sensible, or fair, to expect them to confidently and decisively come up with the recovery strategy that could make or break your business. Even one day a month from a qualified consultant will make a massive difference to your team’s effectiveness and your ability to drive the acquisition of new or lapsed customers, convert the ones you have to spend or visit more, and retain them long-term. 

 

Ines Llerena, director of sector pricing company Pearson Ham, argues: “Pricing and promotional activities will be more important post covid-19 than before. Lower disposable income combined with pent-up demand will require brands to re-think the pricing strategy. This is not the time to increase discount activity nor the time to aggressively increase prices to offset costs. Brands will need to identify optimal price points and promotional activity that boost demand while protecting brand’s profitability. It is essential to understand customers changing behaviours, how the brand can meet those new behaviours and how it impacts the brand’s value equation. In previous crisis, like the dot com bust and 2008 financial crisis, brands that revisited their pricing strategy and focused on price and promotion optimisation had a successful recovery post crisis.”

There is money to be made, and share to be stolen, but you and your investors must have the confidence in the marketing decisions your business is making. 

It’s fair to say many hospitality brands were in a precarious position way before the shattering blow of covid-19. Whether forced there by changes in customer dining habits; disappointing operational delivery; unsustainable rent, rates and general operating expenses; the boom in delivery; indistinguishable brand and marketing; or simple market saturation; the sector was becoming increasingly unviable. 

We know pre-covid-19, the government had a huge part to play in creating a viable trading environment; but if we’re honest, many of us have consistently ignored some of the answers to the fundamental question of how to drive sales and profit. We’ve bought sophisticated systems and platforms, then chosen to disregard the intelligence they bring to decision making. 

CRM systems – that when used well can identify your most valuable customers in terms of frequency, recency and even spend, and tell you how to engage with these golden prospects with the least amount of promotional spend – have been used to indiscriminately blast message, however irrelevant or unwanted. Often because at board level we prize bold actions and big numbers ahead of targeted marketing, which won’t impress anyone with the size of its reach, but would deliver significantly higher returns both in the short and long term. 

Much of this “volume” marketing, which actually serves to erode customer engagement, and destroy conversion, could easily be replaced, or at the very least, enhanced, by data-led marketing that hits the target and consistently delivers its objective. And in many cases, you already have the data and tools to action it with your own businesses. 

A total of 40% of leaders in the coffee sector told a recent Allegra World Coffee Portal study that consumer data was the greatest benefit of coffee shops’ loyalty apps, with it being cited as one of the reasons the outlook for UK coffee shops remains bright, despite the current health and impending financial crisis. But data and technology is useless, unless you’re prepared to understand and action it. 

Organise and use your data wisely to increase your reach and chances of conversion on social, or test new (to hospitality anyway) technologies such as programmatic advertising, which has shown some incredible returns in other physical footfall dependant sectors such as furniture retailers. 

And data doesn’t only translate to sales, profit and loyalty. By using the data found in some of your Wi-Fi and CRM systems, you can get a clear picture of your performance in the context of reduced, changed, or inconsistent footfall too. 

We’ve often got a very strong perception of our brands and how people interact with them. But given few of us have much in common with many of our target audience, and even the newest brands such as Dishoom were born before the dawn of Instagram, it’s likely we’re not as close to our audiences as we’d like to think – and that was before the nation went through the biggest behavioural and emotional shift for a generation.

As an industry we may still be in our relative infancy, but the brands with longevity that triumph through war, major cultural change and recession – such as Twinings (founded in 1706), Lloyds (1765) and Boots (1849) – survive in part because of their ability and commitment to adapting to significant change. 

While many of the things we say we’ll do now (I’m going to spend less time on packed tubes and more time working from home and drinking tea from a teapot), will fade, this experience in some ways, has changed us forever. Use your data, insight and external expertise to give you clarity, and the available technology to allow you to respond to whatever the “new normal” is at any given point – as fast as you can. 

My very best wishes to you all.

They say it takes six weeks to form a new habit. The unprecedented measures to contain this virus – the uncertainty, the potential financial instability for so many, and the weeks spent in our homes – will have undoubtedly altered many people’s habits and behaviours – some of which will stick, if only in the medium term. 

 

“When all this is over”, an overused phrase if there was one, what can we expect from the post-coronavirus consumer? Initially we’re likely to see two extremes of consumer emerging from their homes. The first will be those who have felt cooped up and will embrace the new-found freedom. They will dine out more, travel more, and be more social than ever. (That’s me, in case you’re wondering!). 

 

The other group will have become more connected to their homes –the home cooking, the family time, the slower pace. Many will be more cautious of time spent in the big wide world, many will stay much more local and hospitality will need to work hard to help them feel safe again. 

 

The majority of consumers are likely to settle back to longer term habits eventually, but there are some clear key trends that are already emerging, or should I say, accelerating at a breakneck speed! 

 

Virgin Media claims web content download traffic is up 90%. A wider reach of people are doing a broader remit of activities online – learning, shopping, consuming and communicating. We’re watching live-theatre online, visiting the Louvre, playing online family quizzes, allowing our six-year olds to video call friends and jumping around with Joe Wicks! What does this mean for future behaviour? People have downloaded new apps and seen new ways to experience and utilise the online world. If you thought an online presence was important before, the importance has now exploded. 

 

With music tours cancelled, museums and art galleries closed and sporting event postponed, there is a massive void in many people’s lives. But immersive new technologies mean people can increasingly get their experiential fix from the virtual world. In the “new normal” expect these, and other virtual experiences, to take on new levels of meaning. A photo on Instagram probably won’t cut it anymore! 

 

Consumers were already becoming more health conscious. The covid-19 crisis will have accelerated this. Whether we end up with a nation of OCD hand washers or just a significant number of consumers who are more health conscious; more aware of their mental health; more aware of the need to slow down, de-stress and spend time with the family; we expect the health and wellness trend to further spike. Hospitality will need to proactively help customers feel safe, with regards to food and drink, and their environment. 

 

Many consumers are using delivery when they would never have considered it before – that includes groceries and meal deliveries. Many more restaurants, convenience stores, pubs and the like are now offering delivery when they had no intention of doing so before. Many are realising the benefits, including suppliers who have experimented with direct to consumer. Only 7% of UK consumers were using delivery apps on a weekly basis before this crisis – that figure is looking to be about 24% right now. Consumers are currently accepting kinks that will not be acceptable in less challenging times. Now is the time to experiment and get it right. 

 

5. Never forget 

Social and environmental concerns, or corporate social responsibility, are all getting far more important to consumers – what your brand does now will define how it is seen post-crisis. Don’t screw it up. 

 

An increased acceptance and ability to try video conferencing means many people are speaking more regularly and have shared experiences online. Many businesses are connecting, collaborating and sharing too. We’ve seen many examples of businesses giving their technology or services away for free. Major competitors have collaborated to ensure their customers, communities and businesses stand a chance of survival. Now is the time to think differently – who could you be working with? Which competitors or businesses could you be speaking to that might just change your future? 

 

Events like this happen once in a lifetime (I hope!). It is unlikely you will get this kind of opportunity again to test your weaknesses, experiment with your business and potentially take some risks. Staying close to what your customers want, need and feel is going to be even more instrumental than ever in helping businesses prepare for the future. 

 

If you’d like more information on the above post-coronavirus consumer trends, then Propel readers can download our free whitepaper here or email hello@kam-media.co.uk 

 

Stay safe.