Mantra for Entertainment industry: Refine and Realign: Anand Barot
Companies need to refine their positioning and realign their service delivery models rather than going for a complete strategy overhaul writes Anand Barot, CEO, BOUNCE Inc India.
With more than a fifth of world’s population under lockdown, the world as a whole is going through a challenging period. A fast-paced, all-conquering and deadline chasing civilization, suddenly finds itself helpless and in the midst of a long-drawn lull. The human race finds itself at a pivotal point in its history where both reflection on the past as well preparedness for the future have become all the more critical. We have to accept that our world has changed forever. The world we knew is a thing of the past now. People’s outlooks towards life and its priorities will go through a tectonic shift. This will in turn lead to changed consumer behavior. But, does this mean that all sectors will need to completely overhaul what they did in the past to meet consumer demand in the future? The answer is, “No”. Let’s see the example of the entertainment industry.
Let’s see what will change and what won’t for the entertainment industry. What will change? With uncertainty around jobs and salaries, the discretionary spend of people will come down for a while. As per Boston Consulting Group’s consumer sentiment report, more than two-thirds of consumers believe that irrespective of how long the crisis lasts, their spending patterns will become normal again in a quarter or two. This means that in the interim, people will allocate resources more cautiously. But this doesn’t mean that all discretionary spend will come down. Big-ticket discretionary spends like automobiles, consumer durables, foreign vacations, etc might be the worst hit. Small ticket discretionary spends like cinemas and other recreation options like theme parks might suffer less in comparison.
The decrease in spends will also mean that price sensitivity of the consumer will go up further. The entertainment brands need to take cognizance of this and act accordingly. The fact that travel abroad for vacations will decrease for the foreseeable future will mean that spending might be redirected to local entertainment options. This will help India’s entertainment industry. As people will want to stay indoors even after the crisis is over, in-home entertainment will do better than the out-of-home entertainment for atleast sometime. But, here too there is a small catch. While cinema goers can opt for other home entertainment options and restaurant goers to a degree can opt for home-delivered food, not all outdoor entertainment can be replaced by indoor options. Therefore, the entertainment options and recreation parks that sell unique experiences will flourish. The simple concept of choosing uniqueness over a commoditized service will be at play.
As the average consumer makes stricter spend choices, the brands which delight the consumer will quickly gain precedence over those brands that just meet the needs of the consumer. For example, we at Bounceinc India, cater a memorable experience through our large venue and awesome hosts, that cannot be replicated at home or by any other player. Hence, during this lockdown we have seen that our loyal customers are itching to visit us again as soon as we open. This will be the case for any brand which delivers non-replicable unique services or experiences. There is no denying the fact that social behaviour will change. The consumer’s need to feel safe outside of his/her home will go up further. This will mean that all sectors and more so the entertainment sector has to make provisions accordingly. Less crowded venues, increased sanitization protocols and more contactless service delivery will be a necessity and not a Mantra for Entertainment industry: Refine and Realign luxury. Taking adequate precautions for staff and consumers will go a long way in winning their trust and getting them out of homes sooner. The times are tough but it is the duty of the management to take care of their employees in these trying times. The way the top management will empathize with and handle their human capital, will go a long way in ensuring loyalty of current employees and determine their company’s reputation in the eyes of their future employees. With stringent lockdown, malls and their tenants have suffered significantly. Cash conservation will be a priority for everyone. But it will be critical for each of the stakeholders to sit across the table to find an amicable solution as long-term partners. What won’t change? Like every crisis that the human race has seen, this crisis also will change many things. But it will never change the inherent need of humans to connect with each other, hangout and have fun.
The avenues of fun might evolve till eternity. But, the need to have fun and destress oneself will remain a constant, if not increase. The lockdown has confined everyone to their homes because of which the craving for adventure and the hunger for that adrenaline rush has become multi-fold in kids and adults alike. This pent-up demand coupled will ever-increasing disposable incomes and a young demographic that believes in spending on experiences more than saving, will surely help boost the demand in entertainment industry. We might see a sharp V-curve of spends than a U-shaped one. It is with this hope that India will come out of this stronger that we should adopt the age-old mantra of “Hope for the best and be prepared for the worst”. This long-drawn lull is just a pit stop. It is a time to refuel, check the engine and tyres before the race begins again. No need to change the race track itself. Therefore, companies need to refine their positioning and realign their service delivery models rather than going for a complete strategy overhaul.
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