Key insights:
- Companies brace for lack of staff and resources.
- Consumers may initially be hesitant to attend events due to health and safety concerns.
- 2021 might be a more realistic option for large, global gatherings.
- Agencies aim to maintain client relationships during downtime.
Experiential marketing pros are hopeful that physical events will bounce back in a post-COVID-19 world, and many anticipate Q3 and Q4 of 2020 will be the moment for a resurgence.
Organizers of advertising festival Cannes Lions and music festival Coachella share this mindset, as they’ve postponed both events until October rather than canceling them outright. (Update, April 3: Cannes organizers have canceled the festival, which was originally rescheduled to late October. The next edition won’t be held until June 21-25, 2021.)
However, brands, agencies and companies that provide experiential marketing resources could face a permanently changed, shaky landscape once it’s safe again to create physical experiences for the public and for event and conference attendees. The ongoing coronavirus pandemic has cleared, or drastically changed, the calendars of IRL projects for experiential agencies and their brand clients, leading to inevitable staff layoffs and shifts in priorities as virtual pivots become a temporary new normal.
The overall impact that coronavirus will have on experiential marketing is uncertain, but those in the business of creating live experiences may face an initial reality of getting back to doing what they love while overcoming internal and external obstacles.
Companies brace for an initial lack of staff and resources
Erica Taylor Haskins, co-founder of New York-based event design and production agency Tinsel Experiential Design, faces a common situation for many event agencies across the U.S. right now. Her company, which produces public activations and corporate events for brands like Spotify and Samsung, had its spring and summer calendar wiped clean due to client cancellations; their next scheduled event isn’t until September.
To be proactive and protect the business, Haskins has had to cut staffing to just her and her co-founder, with the company going operationally dark for the foreseeable future. Once it’s safe to plan and hold physical events again, companies such as Tinsel may face an initial lack of staff and resources to execute new projects.
“Our hope is when life is back to normal, we can reinstate our team members to the roles they were in. But I imagine there will be a lot of companies that won’t have the cash flow to support their core team as it was,” Haskins said. “They might be working with a skeleton crew and less staff and resources they’re used to operating with. Or they might just have just a time obstacle of having to interview, hire and train new people. It won’t be as simple as pressing Play and getting back to the way things were.”
Layoffs have extended to agency partners as well, including shops that design, build and offer graphics for brand experiences. Pink Sparrow, a New York- and Los Angeles-based experiential design and fabrication shop, had been working on multiple builds for brands—including one for a major activation at Coachella—which were postponed or canceled.
Shaun Edwards, managing director of the Pink Sparrow’s L.A. location, said the company had to drastically downsize its staff to just a handful of craftspeople. Edwards said while events are on hold, the shop’s current business is making personal protective equipment for healthcare workers fighting COVID-19. It’s also working on builds like branded storefront vestibules for contactless purchases and hand sanitizer kiosks for essential businesses’ patrons to use as they enter and leave.
Edwards said the postponed activation builds are sitting in storage at both of the company’s studios, and the hope is they’ll be used in some form once it’s safe to hold physical events again. However, the issue Edwards and Anthony Santiago, managing director of Pink Sparrow’s New York studio, foresee—as everyone scrambles to make back lost revenue—is a high demand for fabrication shops lacking staff, paired with inflated pricing of materials they source from event rental and prop companies that are also struggling to stay afloat.
Jessica Reznick Martin, president of brand experience agency We’re Magnetic—which produces activations for brands such as Facebook and Instagram—said while many companies have had to downsize, her hope is many people, including full-time freelancers, will be looking for work once events pick back up.
“Whenever companies are ready to start operating again, hopefully they’re going to be able to find talent,” she said. “A lot of people were freelance before this situation, and they will need work. Hopefully these agencies will be able to pick people up, even if it’s in a freelance capacity at first.”
Marketers and planners may have to adjust to new consumer mindsets
Marketing analytics company Performance Research recently conducted a survey of more than 1,000 U.S. consumers about how perceptions of the pandemic will affect engagement with live sports and entertainment events. The survey found that 44% of consumers will likely attend fewer events once they’re cleared as safe to hold, and 63% said event health safety will be a higher concern for them than it was before the pandemic.
