Businesses are always on the lookout for the next big disruption – or are looking to be the force that disrupts their industry. New competitive offerings, legislations and demographic shifts all have the potential to upturn an industry. However, some disruptions come from well outside the world of business and create many questions and even greater risk. The current health crisis around Covid-19 / Coronavirus is clearly part of the latter group.
Covid-19 is at the center of a tremendous amount of uncertainty - implications to customers, employees, families and businesses. But we also have the advantage of an enormous amount of data to help guide us through the crisis. One recent example is a client who is incorporating data on how the virus is spreading and leveraging the incidence by city to quantify the impact. As the virus spreads from one city/region to another we have a true test/control and can isolate the prominence of the virus vs. the business drivers to help address the impact and plan going forward. Through proper analysis, this data lets us know the risks businesses are facing and what opportunities exist to better support customers and minimize business loss.
When faced with disruption and uncertainty, Analytic Partners recommends leveraging advanced analytics to support decisioning and reduce risk. We leverage our decisioning tools and through scenario planning and war-gaming our clients can weigh short- and long-term implications and better meet their customers’ needs, given a range of outcomes.
Analytic Partners has already been working with our clients on modeling such scenarios considering the spread of Coronavirus. Some examples of the topics we have uncovered include:
- B2B: Running simulations on the potential impacts of event cancelations and the media surrounding them. These simulations help give advice on how to mitigate losses and determine impacts if all physical events move to online events for the rest of 2020.
- Restaurant: We have seen the need to shift quickly to changing customer behavior and focus on delivery channels. The team has been working with our client to uncover the channels that drive customers to delivery options.
- Retailer: A clear shift to e-commerce has impacts across the organization, from supply chain to resourcing to marketing. The health crisis would further push the trend clients are already seeing with consumers switching to online purchases. One client is running scenarios to understand how Coronavirus concerns and fewer shopping trips impact their business and decide how to shift behavior to preferred channels.
- Hospitality/entertainment: An area that is certainly challenged in this environment, the focus has been on adapting marketing strategy and messaging. Scenarios are being leveraged to understand how to shift spend. Messaging has a renewed focus on communication around the brand and retaining the connection to the customer, while there is less focus on promotions. And as media consumption increases with people practicing social distancing, staying top of mind with these messages demonstrates a commitment to not just thinking about the short-term but also the longer-term brand/customer connection.
No matter the type of business you are supporting, it is wise to look at risks and opportunities to make decisions that serve your customers while moving the company forward. In a crisis it is especially necessary to get closer to your customers and leverage analytics to understand their needs.
Given that there are significant financial risks for many businesses in a time of crisis, creating and modeling out scenarios not only supports data-driven decisioning, it also allows a clear view of the financial risk – necessary for many companies to report. Most importantly, during this challenging time, we wish everyone to stay safe and healthy.
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