The British public has now had a few weeks of appreciating the luxury of several new-found freedoms. We can now socialise indoors, hug our loved ones (using an adapted hugging technique from the latest Government guidance) and jet off to a select number of approved countries.
Many industries have also welcomed this step towards normality and the opportunity to reengage with their customer base. This is especially true for indoor venues, such as cinemas and theatres, who have navigated a tough year of uncertainty which resulted in significantly reduced revenues.
Despite some optimism from businesses about reopening their doors, the country has experienced the hard way that a tide can turn very quickly during COVID-19. Last year the Government was confident it had sufficiently suppressed the virus by the summer months – despite early concerns of a second wave – and even offered subsidies to a battered hospitality sector to stimulate demand. By September, it was clear the party was over with a second lockdown restrictions on the near horizon.
The early summer period historically generates huge swaths of income for companies, given two bank holidays and (usually) a positive uptick in the weather. It can provide a solid foundation for a successful summer of trading, which is why many businesses will be keen to start this pre-summer season on the right foot by quickly making up for lost revenue over lockdown.
Although, as Britain heads into the summer months, there is some recognition that challenges may still lie ahead. Early rumblings within Government highlight concerns around the new Indian variant of COVID-19, with reports indicating a possible delay or adaption to the last phase of our Recovery Plan.
As such, I would expect businesses to approach the coming weeks with a ‘cautiously optimistic’ mindset, rather than bullishness.
This cautious optimism extends beyond customer assurances of venue safety and acknowledges the financial disparity that COVID-19 has embedded in society. Whilst some consumers are eager to spend their unexpected savings pots, many people are still battling unemployment and financial uncertainty. For every buoyant person keen to enjoy their new-found freedom, there are real people who are extremely nervous about a return to ‘normal’.
Certain brands will leverage the summer months to make up for lost revenue, with recent reports of price rises already surfacing – understandably to recoup costs of operational adaptations. However, this short-termism will likely harm a brand over an extended period as customers pivot towards competitors that incentivise them to spend their hard-earned money elsewhere.
Take Costa Coffee as an example, a brand I otherwise may have occasionally purchased a Caramel Cortado from. Their recent 50p Birthday Sale, which achieved widespread media coverage and customer engagement, incentivised many cautiously optimistic customers back into their stores. I was one of those customers who ditched my instant coffee and treated myself to a beverage. I will confess that whilst in-store I also downloaded the Costa Coffee Club app and may well use them in the future. This reinforces my belief that putting the customer first, especially during a time of crisis, can have material benefits for brands.
I anticipate the public will approach the summer months with an innate British resilience which built the foundation of our economy. Large numbers of football fans will be cautiously optimistic in booking pub gardens slots for England vs Scotland in the European Football Championship, only to huddle under an umbrella when it inevitably rains. Businesses who succeed will have matched their customer’s cautiously optimistic approach, by balancing short-term financial needs with long-term customer loyalty.