The COVID-19 pandemic took the entire world by surprise when it began to spread rapidly around the globe back in early 2020. The level of disruption that has been brought to lives, livelihoods, communities and enterprises worldwide has been unprecedented still to this day. Economies had to come to an abrupt halt whilst businesses, regardless of size or stature, came face to face with an alarming realisation – adapt to a new normal or perish.
How did COVID-19 impact businesses?
Businesses across the world had no time to prepare for the unexpected but inevitable challenges that the pandemic would pose on them. While some industries thrived amidst this economic challenge, others were not so fortunate and were faced with a number of obstacles. Listed are a few common issues that a majority of businesses had to deal with:
1.Move towards being digital
Businesses everywhere were forced to rethink their business model and strategies when governments began to implement lockdowns and social distancing measures to curb the spread of the coronavirus. Enterprises were pushed to enter and sort of live in the digital world if they wanted to maintain any sort of stable revenue and remain somewhat operational as opposed to completely halting for an unknown period (which as we know amounted to about 2+ years). In order to continue workflow, we saw companies switching over to hybrid working situations based on rosters or full work-from-home policies which are still being used to this day as we speak. According to Stanford economist Nicolas Bloom, 42% of the U.S. workforce were working from home full-time by mid-2020.
Having said that, not every business found the move over to the digital space easy or as feasible. Small and midsize enterprises (SMEs) found it more difficult due to the sudden costs that were involved with digitalisation as well as the lack of knowledge that they had regarding the company-wide adaptions to the reinvigorated digital realm.
2. Disruption of supply chains
The rise in infections alongside government-mandated lockdowns, social distancing measures and travel restrictions led to a number of supply chain disruptions both locally and globally. We saw that while demand dropped in certain industries; it surged in others, we witnessed supply shortages, inventory placement challenges and reduced productivity due to the loss of labour. Even now, the flow of raw materials and finished goods continue to be slow in some regions and this has resulted in disruptions in multiple manufacturing sectors. Despite the fact that all businesses felt the impact of these broken supply chains, it has mainly been SMEs who have felt the burden of these broken supply chains the most due to their inability to absorb market shocks as fast or as cost-efficiently as large enterprises. An article by Forbes noted that over 30% of small businesses had reported that the broken supply chains had a considerable impact on their business(es) during the pandemic.
3. Rising costs
As mentioned earlier, the disruption of the supply chains has had an adverse impact on prices all across the world; the unpredictable nature of shipping, labour and the pandemic itself has created an ordeal where business owners are left to speculate when products will arrive and how much they will cost.
Mobility restrictions and physical distancing rules have also added pressure on the supply and demand for certain products, which thereby have impacted the pricing. Prices of food and commodities saw a sharp increase (+22%), whereas manufacturing wages and labour costs rose from 5% to 20% of total costs. Businesses have attempted to absorb these price hikes and balance out the internal costs as much as they can, but most have had to pass the burden onto consumers.
4. Loss of sales and customers
Given the points highlighted above businesses experienced an inevitable drop in the number of sales and customers during COVID-19. Certain enterprises could not hold onto all their employees and were forced to lay workers off in order to keep operations running. According to data collected by the World Bank, the global unemployment level grew to 6.5% in 2021. Rising unemployment alongside rising costs created an environment whereby consumers did not have as much purchasing power as before. This caused businesses to witness a decline in sales and customers.
How did COVID-19 impact the sales & advertising industry?
Typically, the general principle we observe in the Marketing industry is that ad spending follows the trend in GDP. This was something that was observed during the years leading up to the pandemic, the global GDP rose by 3-6% per annum and the ad market grew as well to about $646 billion USD in 2019. This changed once the pandemic occurred as there was a shift in consumer behaviour patterns which created changes within the sales and advertising industry. There was an immediate drop in advertising spending; we noted a 9 to 12% decrease in ad expenditure in the European, German and French businesses. However, while out-of-home, cinema marketing and print advertising declined drastically, digital advertising increased rapidly due to the increase in-home media usage.
How did COVID-19 impact B2B lead generation?
Back in 2020, it was the norm for many tech industry leaders in the B2B space to spend 80% of their time on the road and with clients, attempting to win them over or close deals. This was no longer feasible once lockdown and cross-border measures were implemented. Lead generation businesses like other businesses had to abandon physical interactions and transition into remote selling. Clients had to restrategize their business actions as well as their budgets due to the loss in sales and the unprecedented rising costs.
Having mentioned that, we also noted that while lead generation businesses did lose a few clients during the pandemic, most saw clients onboarding and outsourcing during the crisis – including us here at Team Rocket.
According to Alex Sibille, the director and co-founder of The Future Factory, while a couple of clients did suspend their operations with his lead generation agency, 3 more clients onboarded the agency within the same month. He also goes on to state that he noticed there was an increased effort by enterprises to look for new business activity as soon as possible and marketeers’ wish to meet new agencies had not changed despite the ongoing pandemic. It could be noted that these outcomes were due to the fact that with the uncertain demand shocks in the background, most businesses needed precise attention and assistance with lead generation and henceforth were more open to working with lead generation businesses.
Why did many companies choose to outsource their lead generation efforts during the COVID-19 pandemic?
Much like the experience of Alex Sibille, Team Rocket also saw an increase in client onboarding during the pandemic. Curious to know why that was? Well, it dwindled down to two main reasons.
1.Saves time and money
Lead generation is not a simple task, it takes a lot of time, energy and patience. Outsourcing your complete top-of-funnel lead generation to an agency during a time of crisis can actually be a smart business move.
Hiring a group of experts to prospect, identify qualified leads and set up meetings can save so much time and allow your sales team to focus on other demanding tasks. Outsourcing can also minimise internal costs as it does not take into account the extra expenses such as salaries, medical insurance, etc. According to research, outsourcing your complete top-of-funnel lead generation to an agency costs approximately 62% less than a single in-house hire – a massive saving that can be reinvested elsewhere in the business model.
2. Receive focused attention and work with seasoned digital marketers
One of the other benefits of outsourcing is the attention to detail that you receive. When you have a group of professionals working together in their niche, you are more likely to gain qualified leads which are more likely to be turned into conversions – an added advantage during a time like this.
Furthermore, the sudden move to the digital realm can feel overwhelming for most businesses and so having a team of experts can help take the stress off of your plate. The outsourced team is also more likely to have tools and techniques which can increase efficiency in generating leads that your business may not have and also may not know how to utilize.
The COVID-19 pandemic has undeniably changed the way businesses all over the world function. People, countries and economies have faced a number of challenges during the past few years. Businesses, large and small, have also had to deal with the economic shocks felt in the market. In order to safeguard the sales aspect of businesses, companies have turned to lead generation agencies for assistance.
If you too would like some support with generating leads then do reach out to us. At Team Rocket, we have over a decade of experience in Outbound Email and LinkedIn outreach that can be used to assist you to reach your growth goals.