The coronavirus playbook

The financial crisis of 2008 taught us some lessons that are worth dusting off as we create today’s “2020 Coronavirus Playbook.” The essence of the learnings was to avoid viewing the world through a lens of panic; instead, dig deep into the human psyche for underlying behavioral patterns, and then adjust your business accordingly.

Don’t react to the panic itself. Rather, seek to understand and deal with the panic’s root cause.

During the 2008 bailout by the U.S. government, almost every major American car company lowered their prices — with very little effect on sales. Meanwhile, South Korea’s Hyundai decided to investigate the underlying cause of the crisis. Hyundai’s consumer research program made an incredibly valuable discovery. 

Hyundai found that consumers still had the funds to buy a car; but, uncertain whether they could count on their jobs, they were avoiding any unnecessary spending. In response, the company launched Hyundai Assurance. Their ads read: "Right now, buy any new Hyundai, and if in the next year you lose your income, we’ll let you return it.” Sales went up by double digits. And how many cars were returned? Lee Myung-Bak, Hyundai’s new CEO (who joined the group in 2008) told me: “Five.”

Look in the opposite direction.

In my last book, Small Data, I noted how out-of-balance we feel these days. It might be loneliness, fear, uncertainty, insecurity, or feeling overweight. Identifying those imbalances leads us to discover what I call “small data” — seemingly insignificant observations about people’s lives — which, in turn, create the foundation for new products and services. At the moment, we’re enduring self-isolation and lack of human contact, and chances are high that we’re entering not just a global recession, but a global depression. Of course we’re out-of-balance. But this, in turn, points toward new opportunities. 

For a major global restaurant chain, we recently asked ourselves how they should respond to the coronavirus crisis. The restaurant chain is well known for an extremely careful cooking process, in which safety is paramount. This led to an “eat safe” campaign, with such initiatives as: “Come inside and wash your hands for free” and “Free stay-healthy kits, giving all kids funny (yet safe) facial masks, hand sanitizers, and cartoons with tips for staying healthy during these difficult times.” Within a week, the global chain came to dominate the worldwide home delivery space. 

Plan for your return.

Waiting for customers won’t reinvigorate your business. You need to be making plans for what to do when the crisis ends. How do you intend to “wake people up” and have them think of you as their first option? That’s important, because here’s the issue: Throughout any crisis, we change our behaviors and adopt new routines; and if the crisis lasts long enough, those behaviors become permanent.

Some years ago a strike shut down the London Underground, forcing commuters to discover creative new routes to work. On average, they actually saved six-to-seven minutes per trip. But for a new routine to “stick,” it needs to be practiced for several weeks, or even months; any shorter, and new behavioural patterns don’t become permanent. The strike hadn’t lasted long enough, and within 48 hours, 95% of commuters had returned to their old habits. 

If the current crisis lasts a significant length of time, as it promises to do, we're likely to see lasting change.

Certain businesses may vanish forever. Open buffets in restaurants may disappear, and crowded dining rooms may be a thing of the past. Other concepts will replace them.

In short, the longer we practice a new routine, the more likely we are to stick with it once the dust has settled. Special offers and discounts may not be enough to lure customers back to their old habits.

The answer may be found in the counter-balance theory. Ask yourself what we’ll miss — even what we’ll forget. The 2008 data tells it all: The fastest growing niches during and after the recession were “sin industries” (wine, chocolate, eCigarettes) and nesting industries like Snuggies and homewear. 

Look at it this way: With every challenge comes opportunities. Don’t be shocked by the challenge. Instead, now’s the time to start brainstorming on the opportunities ahead.

Martin Lindstrom is the founder and chairman of Lindstrom Company, the world’s leading brand & culture transformation group, operating across five continents and more than 30 countries. TIME Magazine has named Lindstrom one of the “World’s 100 Most Influential People.” Lindstrom is a high profile speaker and author of 7 New York Times best-selling books. His book Brand Sense was critically acclaimed by The Wall Street Journal as “one of the five best marketing books ever published,” Small Data was praised as “revolutionary” and TIME Magazine wrote this about Buyology: “a breakthrough in branding”. 

Watch this space for exciting pre-order packages for Lindstrom’s new book: The Ministry of Common Sense - coming soon!