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LAUNCHING FOR SUCCESS

In the wake of a pandemic, it can be tempting to assume that life will resume exactly as it was, yet COVID-19 has had profound impacts on our patrons, staff and businesses. Resisting that temptation and thinking carefully about your offering and some key dimensions of your operations will be crucial to opening early and profitably. 

 

Today, we’re at an interesting point in the evolution of the pandemic: stuck somewhere between a crystal clear memory of what it was like just before COVID-19 hit whilst at the same time being remarkably well-adapted to a new reality with masks, disinfectant and an absence of real human connection. All of us have been impacted in some way over the last few months; be that our health or those of the people we love, our businesses or the staff that we employ. Millions have flocked to social security benefits as their employers or businesses put up the shutters to weather the pandemic. Yet, as emerging data tells a story of a flattening curve with fewer new cases each day and politicians speaking of relaxing safety measures, those of us in the hospitality and events industry are starting to wonder about the return of trade.

History has shown us that extended periods of economic and social distress caused by pandemics or significant conflict, consumer spending on entertainment, luxury goods and experiences quickly rebounds (1). In fact, demand for luxury goods and experiences such as travel and entertainment tend to rise during times of crisis, due to a psychological association between spending on luxury and the preservation of identity and security (2). It is tempting therefore to take comfort in a rapid return to a state of better-than-normal. While we’re confident that this will be the case eventually, early signs suggest that we’ll be facing tighter licensing restrictions such as reduced venue capacity and a much more timid customer for the first 6 months and waiting for normality might not be viable for many businesses.

Below are some of the predictions we’re making about the return to trade and some of the things you can do to prepare for them.

Your customers aren’t going to want exactly the same thing from you. 

COVID-19 has altered the DNA of our guests. While we still crave proximity and human connection, we’ve become at ease with distance. Conversations take place at physical distance, be it 1.5m apart or via video conference. We welcome the use of gloves and a mask when engaging with our local butcher or grocery and we wash our hands ad nauseum. These things once seemed sterile and impersonal, they now impart comfort and security. CNN reported (3) that, despite lifting restrictions more than 3 weeks ago, Wuhan, the epicentre of the outbreak, is still wounded, with many stores still closed and consumers still frightened to venture out and risk infection.

Those venues who go above and beyond to communicate the adoption of thoughtful safety measures will be the ones that customers return to. There is likely to be some licensing guidance, but we would encourage you to think about how you might ease guest concerns about health and safety before, during, and after their experience. Some venues may choose to discontinue self-serve at the bar to reduce the risk of contagion, instead expanding their VIP or table service offering by adding table and reserved spaces. Others might take the time to collect key contact details from their customers to ensure that if one guest does become infected, everyone else can be promptly notified.

This is the time to be evaluating your unique value proposition and exploring the ways it might need to evolve to meet the concerns and needs of your guests in a post-pandemic world. To do this, determine which elements of your offering are most important to your guests and which you can continue to deliver in a post-pandemic state. Once you have a clear picture of these, ask yourself whether you can re-bundle these elements or replace them with new concepts, unique collaborations, or partnerships.

This exercise will help you find new ways to delight your guests and pander to their paranoia at the same time. Waiting for normality is also an option, but other venues will be using this time to build relationships with your customers.

Your marketing and promotions must evolve.

Across the board, event creators will have to look at how they are going to keep their staff and customers safe once the industry begins to reopen. Marketing and sales teams are no exception. Promotional team operations will need to be re-examined, ensuring they are as contactless as possible in order to keep their customers and promoters safe. This means hard ticket distribution and real-world marketing will need to be looked at differently. With fewer congregations and less people transiting, it will be hard to rely solely upon physical posters and advertising.

Event creators and operators will leverage technology to activate their promoter networks and generate revenue through tickets and table sales. You will also need to increasingly rely on your promoters for virtual marketing activities. In order to maximise the effectiveness of this, you’ll need to be clear about your instructions and find ways of reporting on the success of their activities. Remember that they too will need to be comfortable with and able to communicate the change in your proposition to support health and safety during this time.

Ultimately, these individuals and their organic networks will be the force inspiring customers to come back to venues and events.

Your supply chain is likely to be interrupted

It is said that necessity breeds innovation, and in recent months this has held true. Many bars and pubs have evolved, delivering meals and drinks to local residents or providing takeaway cocktails. Others have become temporary bottle shops, selling down their inventory to provide cash flow in the short term. Yet this poses problems for reopening.

With shipping and logistics interrupted many operators will find their standing orders harder to fill when trade resumes, especially at lower volumes than before. The loss of a key ingredient could have a profound impact on your food or cocktail menu. Being aware of potential disruption early will allow you to adapt your menu, potentially moving toward local alternatives.

You’ll need to review key processes and assume a leaner workforce.

Venues, especially those that have been around a long time, rely on well refined and established processes for operation. They know exactly how many tasks must be completed to open and close the venue and how long each should take. Key responsibilities are distributed between clearly defined roles. Sadly, the current circumstances have forced many operators to stand down staff members and this poses problems for opening. What may have been a team of 10 will now be 5, juggling multiple roles as the situation requires.

Having considered changes to their offering and supply chain, operators should ask themselves whether they can clearly define and allocate the responsibilities and tasks to a smaller team and the extent to which these have changed. Will new skills be required to help your team members perform new roles and can gaps be bridged through upskilling?

Not only must your teams be able to empathise with the changed sentiments of your patrons, you will need to be empathetic to the changed attitudes of your staff as they are least like to communicate them to you.  Delivery of memorable experiences is what we do best, but doing so requires a team that feels completely at home In their work environment.

Cash flow will be under more pressure than ever.

Unfortunately, the easing of operating restrictions and the resumption of trade is likely to be partnered with a significant cash flow hit. Landlords will be looking for repayment of delayed rental obligations; stock depleted through direct sale during lockdown must be replenished and cash-strapped suppliers will be operating with tighter payment terms. On top of that, venues will need to market heavily just to tell the world that they are open again, albeit at reduced capacity in the early stages.

While there is no magic bullet here, planning for these impacts and having frequent and honest conversations with these parties will ensure that surprises are minimised.

Explore ways of securing payment early. Some great examples we’ve seen in the last few weeks have been the advance sale of venue memberships, table bookings and vouchers. Strategies like this have the dual impact of engaging your loyal patrons and helping ease the cashflow hit upon relaunch. Every venue is different so we recommend taking an experimental approach, testing timing and patron receptiveness to new concepts in a controlled fashion before resuming trade as before.

Closing words

While some of the above predictions may seem overly negative, events and nightlife deliver to a basic human need for connection and escape from the stresses of our lives. There is no doubt that these will be needed more than ever when the pandemic subsides. In the meantime, we hope to pave a way for venues to open and thrive, even under constrained conditions, coming out of this stronger than ever before.

 

This article was written by Andrew Nunn, Co-Founder of DQ and Ny Bass, Co-Founder of STRYD.  

References

(1) Bohanon, C. (2012) MERCATUS ON POLICY, “Economic Recovery: Lessons from the Post-World War II Period”

(2) Danzinger, P. N. (2020)  Forbes Magazine, “What The Aftermath Of The Global Coronavirus Pandemic Will Mean For Luxury Brands”. Accessed March 15, 2020 here

(3) Culver, D.  CNN, “Wuhan shows the world that the end of lockdown is just the beginning of the Covid-19”. Accessed 12 May 2020 here

 

STRYD is a comprehensive team and operations management platform that provides venues with the tools needed to optimize their marketing, sales, and staffing needs. While providing predictive analytics to change the way events are managed, marketed, and booked. Find out more at strydapp.com

DQ is the premiere software system for table service operations in nightlife venues.  DQ empowers staff and management to deliver the highest quality table service experiences, efficiently, safely and cost effectively.