2  April 2020

The Effect of the Coronavirus (COVID-19) on Sales, and Business Strategies to mitigate its impact.

Let’s look at key problems faced by sales teams through this outbreak, and explore solutions to mitigate the effect of the Coronavirus on sales.

 

You are reading the Business Development, Services and Marketing (BDSM) Blog. Named to reflect the punishing amount of discipline required to master the core tenets of the industries we service, we blog about current affairs, industry tips, tech developments and more.

     Written by

    Eli Hanif

    Digital Marketer

First, let’s preface this by hoping everyone is staying safe, and practicing safe social distancing (yes, that includes you, sales teams). While many salespeople are understandably worried about a business’ bottom-line, social and personal responsibility comes first.

That said, businesses are bearing a large brunt of the ongoing COVID-19 situation—backed-up supply chains, staffing challenges, compounded by comprehensive governmental oversight that include country-wide lockdowns that spare almost no industry—you have every warranty to worry about operational uncertainty.

Fortunately, there are ways to mitigate the problems, to turn that worry into action. Let’s take a look at the effect of the coronavirus on sales, and silver-lining solutions that could address them.

virus figures chart

Key business problems stemming from the COVID-19 pandemic

Global alarm has been growing—at the same rate that COVID-19 has been spreading—and nobody knows when things will get better. At the time of publishing, 935,189 people have been infected and over 34,000 have succumbed to the virus.

This has led to a paradigm shift in the attitudes of the masses as well as governmental regulations that directly affect businesses. Here are 3 key challenges that businesses are having to navigate in what’s becoming the new reality.

1. The first effect of the Coronavirus on sales: Businesses and salespeople can’t connect due to restrictions in international and local travel

Today, almost every country has some form of travel restrictions in place. For most, visitors from countries deemed high-risk, such as China and parts of Europe, are barred from entering, while residents who have visited affected areas are subjected to quarantine-on-arrival.

More recently, full-scale lockdowns in many countries prohibit local commutes as well and as a result, in-person and trade events which are a cornerstone touchpoint for many B2B companies have been cancelled or postponed.

Some of the biggest headline industry events, such as the Mobile World Congress (MWC), Adobe Summit and Facebook F8 have been cancelled, and Vox’s Recode reported that the direct economic loss from the cancellations will surpass $500 million.

With the infection curve still on a sharp incline, there are fears that there will be prolonged restrictions on business travel, adversely impacting sales teams that still traditionally make connections and conduct purchasing or partnership discussions at trade events like MWC. One thing’s for sure, this does not bode well for the 68% of B2B marketers who use events as a lead-generation initiative, and the 21% that would normally be allocated towards event expenditures will be diverted elsewhere.

2. Businesses have to navigate decreased footfall to their offline stores, because consumers are increasingly staying home.

Predictably, the number of customers visiting brick-and-mortar stores have fallen drastically amidst the fear of contracting COVID-19. The impact is felt in retail, food and service establishments. Luxury giant Burberry reported that footfall has fallen 80% during this period.

International brands have also moved to closing stores temporarily in affected countries in response to the outbreak, a move forced through government-mandated shutdowns. However, 69% of UK organisations experienced a drop in demand for their products and services even before these measures. Nike had dropped 5% in all sales in Greater China, while Starbucks also expects to lose $430 million globally this quarter.

With 76.4% of consumers in the US limiting their retail visits, traditional brick-and-mortar businesses need to move quickly to ensure business survivability and continuation beyond the crisis, and move to capture the physical shoppers in their newfound digital buying habits. While governmental-led stimulus packages around the world are being rolled out, what’s also worth looking at are the privately-led initiatives that help businesses cope, such as Shopify’s US$200 million fund to help small businesses, and even Novocall’s own US$100,000 Call For Care initiative, rolled out to support physical medical practices with pre-scheduling.

 

Newspaper listing

3. Consumers fear making larger purchases due to economic instability—an added effect of the coronavirus on sales

Luxury brands are expecting the coronavirus epidemic to cost the segment as much as $32 to $43 billion in sales, according to a new survey done by Bernstein and Boston Consulting Group. Pauline Brown, former chairwoman of LVMH North America states “it’s a psychological purchase and the fact that people are not feeling safe and are not feeling prone to go shopping”.

Sales in the world’s biggest car market, China, fell 79% in February—the biggest monthly decline ever. As coronavirus spreads globally, other regions like the United States get increasingly affected too. Peter Nagle, senior researcher, automotive economics with IHS Markit says “Regions like Seattle, San Francisco and greater New York are trending lower in the first days of March – Seattle is down 10%-12% over March last year.”

The stock market plunged almost 13% on March 16 after governments worldwide expanded calls for containment measures, including mass school closures, and central banks intervention in the markets. This comes hot on the heels of an already-downward trend, and is a testament to the state of the economy, and consumer’s reservations on non-essential expenses.

Man using the internet on laptop and mobile

Let’s look at some strategic solutions that businesses can deploy to mitigate the effect of the Coronavirus on sales.

While there are many factors affecting businesses, not all is lost. Processes and revenues may not be as optimal as before, but companies should be adaptable to this ‘new normal’ and find creative ways to circumvent the problems faced. Here are some measures companies can take to reduce the negative impact on their businesses.

1. Using digital solutions to make connections online through virtual events and meetings.

A big part of conferences for businesses or salespeople are about making the right connections and meeting new prospects, so it’s a big advantage that virtual event software such as Brella allows not only for live stream chat, but also Artificial Intelligence matchmaking and video conferencing to join relevant attendees. Other software like WorkCast offer integration to systems you already use—such as HubSpot—and allow for collection of important attendee data to boost future sales and marketing efforts.

Outside of these events, sales teams still need to not only engage prospects quickly, but also on a range of levels so that your sales operations don’t stop. While digital call-back solutions such as Novocall capture new leads, its new NovoMeet feature(currently in beta) integrates a meeting-scheduling function that allows sales teams to continue engaging prospects all in one place.

2. Applying the Know Your Customer (KYC) concept into your sales and marketing strategy.

It’s heartening to know that a majority of the population are spending more time at home to avoid infection and adhering to government regulations and calls to #FlattenTheCurve. All this time at home means people are and are looking to digital channels for entertainment. Consequently, brands are forced to congregate there to mitigate the effect of the Coronavirus on sales.

For instance, after a forced closure of 40% of their stores, cosmetics company Ling Qinxuan redeployed over 100 of their beauty advisors to become online influencers. They leveraged digital tools, such as WeChat, to engage customers virtually and drive online sales. As a result, the brand achieved 200% growth in sales in Wuhan compared to the year before.

The KYC methodology—commonly used by the finance industry to verify prospects—can be employed to understand your consumers by bringing to light risk factors that sales teams should get on top of; such as attrition. Introduce systems for tracking and prioritise product enhancement ideas that come from customers via our support desk or sales teams, and appointing dedicated field staff who work with new customers to help them get set up while observing and learning how they use the product. This deepens and builds the understanding they have of their customers as an ongoing exercise, and helps sales teams discover and understand new and developing behavioural shifts to where your consumers are right now.

With this knowledge, sales and marketing teams will be able to better engage both current and potential customers to make the most out of your effort and spending. In this time of uncertainty, trying new methodologies to further understand your customers can prove beneficial.

 

People reading newspapers with masks on

3. Capturing more leads, qualifying them and nurturing every single prospect for more sales efficacy.

Because less consumers are on the lookout for purchases (especially for non-essential items) it’s important to quickly and effectively capture every single sales lead that comes your way.

It’s simple math, really. If you want to maintain a given number of buyers when faced with decreasing opportunities, increase your sales and marketing conversion rates!

Calls remain an integral part of sales journeys, with 92% of all customer interactions happening over the phone. This means that businesses need to make it simple for customers who pick up the phone to make a purchase. However it’s not that easy to do this—analog calls alone don’t suffice with issues like missed calls or customers being put on hold—especially with the risk of a potentially less productive sales force while working remotely.

“61% of consumers in a Google and IPOS survey of 3000 participants, found it important to call a business at the purchase stage”

This is why digital call-back solutions simply work better. Connect customers to agents instantly, direct customers to the right teams automatically, and call scheduling for when teams are busy, to connect at a time convenient for both ends.

As an added benefit, these solutions can also deliver valuable customer insights to sales and marketing teams. Data such as

  • Name, Number, Email
  • Customer journey, pages they viewed
  • Marketing Campaign and Source

can be captured to both assess leads before an agent picks up a phone, and influence future lead generation strategies. More effort can then be spent nurturing these newly assessed leads, which could in turn lead to higher conversion rates.

Also to remember while nurturing leads, are consumers’ mindsets in this sensitive time. This isn’t the time to hard-sell, but to represent the brand in an empathetic light. Prospects may not buy from you immediately, but your brand memorability may lead to future sales when the pandemic eases.
Chris Stephenson, regional head of strategy and planning, PHD APAC, reminds businesses that they should be planning for the eventual recovery, saying “prepare now for campaigns to reflect the optimism, for popped-up and expanded physical availability to capture resurgence of demand, and ready your promotions and incentives to capture a share of sales when they recover.”

Adapting to the effect of the Coronavirus on sales while preparing for business recovery

There’s no skirting around it. The COVID-19 pandemic has impacted every corner of the globe, on a personal and professional level. However, with the right measures, and tactical use of digital strategies and platforms, brands can weather this storm by adapting to the ‘new normal’ while remaining optimistic in preparing for better times ahead.

If there is one good thing about this situation, it would be the collective realisation stemming from all the contactless meetings, it would be the realization that every in-person hour-long meeting you’ve ever thought could have been done over an email or call, could well have been just that.

Stay safe everybody.

 

You are reading the Business Development, Services and Marketing (BDSM) Blog. Named to reflect the punishing amount of discipline required to master the core tenets of the industries we service, we blog about current affairs, industry tips, tech developments and more.

     Written by

    Eli Hanif

    Content Marketer

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