NRF 2021: What did it take for consumer-direct startups to get through the pandemic?

Discussion
Source: Facebook/Saks Fifth Avenue
Jan 22, 2021
Matthew Stern

While the pivots many businesses have made to stay afloat during the novel coronavirus pandemic have required upping or adding tech services, for the founders of two direct-to-consumer brands who spoke in a virtual session at the 2021 NRF Big Show, it meant relying more strongly on core brand values.

“[In a large-scale emergency] there is mass panic,” said Simon Huck, co-founder of Judy, a disaster preparedness kit startup that entered the market in January of 2020.  The company suddenly found itself thrown into the deep-end; disaster preparedness was suddenly front-of-mind with everyone in the world, and the company wasn’t prepared for one of the biggest emergencies in modern history.

“There is confusion and there’s misinformation and I think all of those things we thought about, but I had never actually been in an emergency at that scale before so suddenly within two weeks you’re seeing all of these worse case scenarios happen,” said Mr. Huck. “There was a ton of misinformation around COVID-19, and something that you say on Monday about not wearing masks is no longer true on Wednesday, so as a brand we had to be really careful.”

Judy’s kits, designed for wildfire situations, came equipped with N95 masks, but due to their scarcity, Mr. Huck realized they could no longer include them. Judy donated its entire N95 inventory to the New York Department of Health. The brand also turned off paid marketing so as to not look opportunistic and became a content hub for reliable, factual information about the pandemic from health professionals.

Lauren Chan, founder of Henning, a plus-sized luxury apparel brand, was initially worried about a supply chain breakdown due to the pandemic. Seeing the way people moved away from excess and the unnecessary in times of crisis, however, she chose to shift gears and focus on social awareness.

“I felt in the end very aligned with our original messaging and our original goals,” said Ms. Chan. “We decided to double down on our messages of ethics, increased sustainability, timeless essentials, quality work and things made locally.”

DISCUSSION QUESTIONS: How important do you think company values are when it comes to successfully navigating a disaster, and what advice do you have for institutionalizing those values? Do moves like discontinuing paid advertising have a significant impact during times of crisis?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"Kudos to those brands that rose to the occasion. They had invested in establishing values long before COVID-19, but that paid off when their brand image remained consistent."
"Too many consumers make purchase decisions based on social responsibility for companies and brands to take these positions lightly."
"Company and brand values should always be at the center of a business. I worry for any brand where it took the pandemic to make management realize this."

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7 Comments on "NRF 2021: What did it take for consumer-direct startups to get through the pandemic?"


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Chuck Ehredt
BrainTrust

Values are essential in a disaster because most of the people involved are confused about what to do. A business, as well as individuals with deep-seated values, will always shine as honest because people will react based on what they value. That doesn´t always mean the values are good. In the airline industry, most brands became very flexible in extending benefits for loyalty program members, while others tightened the screws to avoid cash leaving the business. This has really resonated.

Disaster planning is often a good exercise so a playbook is in the drawer when disaster strikes, but perhaps more importantly because the planning process forces the organization to take inventory of their values and see how they play out in various scenarios.

Kudos to those brands that rose to the occasion. They had invested in establishing values long before COVID-19, but that paid off when their brand image remained consistent through their actions.

Andrew Blatherwick
BrainTrust

Company and brand values should always be at the center of a business. I worry for any brand where it took the pandemic to make management realize this. If they were not so important before the pandemic hit, will they be so when it has all died down?

The essence of a company – how it is seen by its customers, its employees and its investors – is defined by the company values and culture. Everyone in the business should understand very clearly what they are and if they do not agree with them, they are probably at the wrong company.

Natalie Walkley
BrainTrust

Annual business plans and advertising budgets will be forgotten over time. But how a brand behaves and treats humankind will never be forgotten. If a brand is truly “the way an individual perceives it” then it is critical to keep individuals at the center of the brand strategy, which is why many successful brands made seemingly unusual business decisions in 2020.

A contrary example is the individual that bought hand sanitizer in bulk and then tried to resell it at inflated prices. While not a business, this person’s reputation and livelihood tanked after this opportunistic move.

Rachelle King
BrainTrust

Nearly all companies have stated values but sometimes it takes a global pandemic to actually see those values come to light. Huck was in a unique position to take a very opportunistic approach but his sincere desire to help others and grounding his efforts in ethics vs. profit will pay off for him in the long run.

Too many consumers make purchase decisions based on social responsibility for companies and brands to take these positions lightly. It’s so much easier for companies to lean into their values in the middle of a storm (or pandemic) if they practice those values everyday. It gets even easier when the CEO is leading that charge.

Georganne Bender
BrainTrust

Now more than ever, a company’s values are key. Millennials and Generation Z choose brands based on values and ethics and the rest of us are following suit.

Walmart, for example, put its values front and center during the pandemic, letting consumers know that it would be there for them, and it followed through with what it promised. Advertising for most companies did not stop, it just took a different turn. Throughout the pandemic we have seen ads become less about hard sell and more about how the brand/product can be used to help make our lives better. I like that twist.

Craig Sundstrom
Guest

Certainly vales are critical; the real question is WHAT values … are they the same for every company (or situation)?

First, of course we have what might be termed baseline values — perseverance, a sense of perspective … but what about something like honesty? Honesty itself certainly isn’t bad; but it can become easy to confuse honesty with passiveness, which is less commendable. I won’t go as far as to criticize the decision to discontinue advertising, but to do it on the assumption that not doing so would be “opportunistic” I find problematic. One person’s “opportunistic” is another’s “bold” … who is to say which interpretation the marketplace will choose?

ronenluzon
Guest
2 months 16 days ago

Values are important, but unless there is some benefit to the consumer, they simply choose the option that has a two-day free shipping standard. Those retailers that survived Covid-19 didn’t just have values, they provided value to their customers as well. They provided value via fast delivery that was convenient, unique offers, and personalized tech such as smart sizing for online apparel purchases. The takeaway was that consumers like buying from direct to consumer startups, but they need to offer something different or competitive when compared to the retailing behemoths.

wpDiscuz
Braintrust
"Kudos to those brands that rose to the occasion. They had invested in establishing values long before COVID-19, but that paid off when their brand image remained consistent."
"Too many consumers make purchase decisions based on social responsibility for companies and brands to take these positions lightly."
"Company and brand values should always be at the center of a business. I worry for any brand where it took the pandemic to make management realize this."

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