Coping With COVID-19: Luxury Hospitality Brands

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Luxury hospitality brands have had to pivot and alter their business models, supply chains, and operations. Here is a rundown on the state of the luxury industry and where it’s headed: 

The Effect of the Pandemic on the Luxury Industry

Luxury goods and services saw deep declines in 2020 due to financial strains and lockdowns. While luxury retail stores suffered, some segments of the luxury industry thrived. Here are some effects of COVID-19 on the luxury industry:

  • The Rise of Luxury Consignment

Luxury consignment has gotten a boost from the pandemic as people had more time to clean out their closets. Luxury consignment is hip, cool, ethical, and environmentally friendly. Additionally, the ability to sell luxury items and get fast cash has been an appealing factor for financially-strapped Americans. 

ThreadUp notes reselling a piece of clothing extends its life by two years and has an 82% reduced carbon footprint. Luxury consumers care about how their clothes are made and its environmental impact. 

For example, that $1500 Hermes handbag in your closet can be sold for cash on resale sites Poshmark, ThreadUp, or RealReal. Over the last three years, the luxury resale market has outpaced new clothing sales by a 21:1 margin. By 2023, the luxury consignment industry is predicted to reach up to $51 billion.  

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  • Remote Service is Beneficial All-Around

COVID forced many luxury brand companies to change how they operate. Some shut down their brick-and-mortar stores and moved online. Others offered curbside pick-up, virtual appointments, and delivery services.

Consumers concerned about their health have turned to the safety and convenience of online shopping. The virtual nature of doing business also benefited companies with greater productivity and cost-savings. RealReal observed their salespeople booked more virtual appointments per day because they did not need to travel to physical ones. 

 

  • Online is Where the Sales Are

E-commerce skyrocketed in 2020 as homebound consumers took advantage of the convenience of online shopping. According to the U.S. Census Bureau, U.S. consumers spent $211.5 billion on e-commerce. Online shopping accounted for 16.1% of all sales in 2020 due to Coronavirus concerns. 

The Buying Habits of Luxury Consumers

Throughout the COVID-19 Pandemic, luxury consumers have altered what they buy and how they buy. With trips canceled, luxury customers had more to spend on items like home entertainment, fitness equipment, furniture, and home goods. The retail e-commerce market continued to grow in 2020 and will likely continue over the next few years.  

Online privacy, well-being, and family health were concerns for luxury consumers in 2020. The proliferation of online shopping has increased the risk of scams. Health and well-being were reflected in what consumers bought and their online shopping habits. 

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Short-and Long-Term Luxury Hospitality Industry Forecast

The U.S. luxury  industry shrank by 27%, to $73.6 billion in 2020 due to the Coronavirus pandemic. An Altagamma Consensus report notes that luxury stores experienced a 40% drop in revenue in 2020. In 2021, they should rebound by 8%. 

Many companies will maintain their online stores until customers feel comfortable congregating in large numbers. When that happens, brick-and-mortar stores will be experience centers. Stores will be sleeker and utilize AI automation to bring fast, personalized service. 

The North American luxury market will increase by 14% in 2021. Despite the positive outlook, 2021 will still have plenty of uncertainties.  Luxury brands can cash in on the spending consumers would otherwise spend on travel. 

While the pandemic has devastated the luxury hospitality industry, there is a glimmer of hope on the horizon. The rollout of COVID vaccines, federal economic interventions, and relaxing travel restrictions will bring luxury consumers back. The selling of luxury goods will remain online for many years to come.  

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Successful Marketing Strategies for Luxury Brands

The COVID-19 pandemic has changed the way consumers interact with luxury brands. To make up for losses, those in the luxury industry must adapt their marketing efforts. Here are some marketing strategies to implement for 2021 and beyond: 

 

  • Focus on Voice Search

Nearly half of all Internet searches are via voice. On a worldwide scale, 27% of those with Internet use voice search. In the U.S., 25% of Americans own a smart speaker that they use for browsing the internet.  

Asking Siri or Alexa a question is easier and quicker than typing a query into the search bar. Twenty-two percent of consumers purchased items online via voice search. This thriving sector is expected to become a $40 billion industry

 Search engine optimization for voice requires the use of long-tailed keywords and anticipates questions searchers will ask. The average search length is three words on mobile, six on a computer, and 29 words in voice search. You can alter your digital marketing efforts to accommodate voice through interactive Q&A, industry trivia, and customized product guidance. 

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  • Rally Behind a Cause 

Younger luxury consumers support brands that are active in making a positive impact in the world. Simply providing superior products will not cut it anymore for today’s luxury buyers. Brands must now prove they care about current issues like sustainable practices, social justice, online privacy, and ethical business practices.  

The heart of your luxury brand marketing plan must center around causes important to your customers. Luxury consumers are more likely to support brands aligned with the issues they care about.

 

  • Invest in Making Podcasts

Due to the lockdowns and stay-at-home orders, podcast views increased significantly. For entertainment and engagement, luxury consumers are hungry for audio and visual content, making podcasts a top 2021 marketing trend

Podcasts are great tools to inform and entertain customers while also boosting brand credibility, transparency, and trustworthiness. Podcasts can be in any format that is aligned with your brand and captures the interests of customers.Dior, Gucci, and BMW are a few luxury brands that have launched podcasts around social issues, influential women, and music. 

2020 was challenging for the luxury hospitality industry. Companies had to move online. The luxury industry will rebound, but brands need to gear up for voice search, podcasts, and advocate for a cause. 

 

 

The State of the Financial Services Industry in the Wake of COVID-19

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Even though we’re a year into the COVID-19 pandemic, the financial services industry continues to adapt and transform. Ever-changing social distancing protocols and market trends require companies like those in high finance to adjust quickly and often.

If you’re feeling overwhelmed and don’t know which strategies your company should focus on, keep reading. Below are the biggest ways high finance has adapted to the pandemic. We’ll also discuss the strategies that are here to stay and will make you more competitive in the future.

How High Finance Has Adapted to the Pandemic

The world of high finance, with its need for cybersecurity and constant communication, faced challenges with remote work that other industries didn’t. Meanwhile, market volatility increased customer dependency on financial advisors. Companies successfully responded to these and other obstacles with these strategies:

  • Working Virtually

Like many industries, the majority of the financial services sector shifted so employees could work from home. However, financial companies had to adjust in ways other businesses didn’t.

While the rest of the world uses software like Slack and Zoom to keep teams connected, those tools aren’t secure enough for finance. Alternatives like Symphony and Webex adhere to financial companies’ high security standards while keeping employees at home.

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In addition, organizations needed to come up with quick fixes for unique challenges. For example, Lulalend, a fintech startup in South Africa, had to keep employees in touch even as the country experienced challenges with the electricity supply. Their solution was to provide team members with USP battery backups to use during outages.

Overall, working virtually has gone well. PwC’s Remote Work Survey found that 69% of financial firm executives believe their employees are as productive working from home or even more so than they were pre-pandemic. However, the same survey noted that companies often struggle with bandwidth constraints and limitations with remote coaching.

  • Digital Prospecting

High finance transactions involve sums that require a deep level of trust between parties. That trust is usually nurtured through face to face interactions over time. 

Remote work has encouraged many companies to get creative about how they build those bonds. Some methods include:

  • Increased content marketing – Write emails or blogs that answer your ideal customers’ most relevant financial questions.
  • Participating in webinars – 72% of customers would rather learn through video.
  • Hosting virtual meet-ups – Give potential customers the one-on-one experience while social distancing.

Financial advisors have also exploded onto social media, sharing tips on LinkedIn and engaging with potential customers on Twitter. However, financial brands should be mindful about how they handle these platforms.

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In an op-ed for CNBC, Blair DuQuesnay, an investment advisor and financial planner at Ritholtz Wealth Management, notes, “Brand accounts do not garner as much attention, engagement or trust as individual accounts do. Firms that fail to recognize the power of the individual brand, or those whose cultures oppose the promotion of personal brands, will lose momentum on social media.”

Remember, prospects favor online interactions that feel genuine. This is easier when engaging with another person on social media instead of a faceless financial brand. 

For more on how you can optimize financial advisor prospecting during the pandemic, check out this guide

 

  • Increased Digital Communications Channels 

In such uncertain times, people want guidance and help on demand. This has led to a transformation in how companies and customers communicate virtually.

According to a survey of 2,500 enterprise decision makers conducted by Twilio, 60% of financial services companies responded to the pandemic by expanding their digital communications. This includes adding chatbots, live chat, and in-app chatting. The same survey found that on average, digital communication strategy schedules accelerated by almost six years.

Interestingly, the pandemic may have saved some financial businesses in the long run. Fintech companies were ahead of the curve when it came to adopting digital communications. Meanwhile, 69% of U.S. banking brands had average or below average digital performance. Lockdowns forced those institutions to pivot their digital strategy, bringing them up to speed with Fintech.

  • Analytic Software 

Data analytics have always been crucial for financial companies. The pandemic merely illuminated that. Changing circumstances have accelerated certain transactions, like selling stock, inheritances, and business sales.

Raj Khera, former Executive Vice President of WealthEngine, explains during this live Q&A that the best time to find new customers is before their major liquidity event, not after. This puts you in the position to advise them on tax breaks or other areas that will make their transaction smoother. Data analytics makes it possible to find those customers before they even realize they need your services. 

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With prospect research software like WealthEngine, you can screen a database of potential customers and look for certain characteristics. For example, Khera notes that in the next decade, millennials will increase their wealth by a factor of five as 20 trillion dollars in assets will be transferred to them. Data analytics software makes it possible to find those future customers and start building a relationship with them today.

The Future of the Financial Services Industry

Even as vaccines roll out, remote employees and online chatting are here to stay. 99% of financial companies in the Twilio survey agree that future opportunities for virtual work are possible. Meanwhile, 94% of respondents say they’ll keep expanding virtual communication channels even if the pandemic subsides.  

That being said, customers expect authentic connection with businesses despite communication moving to digital channels. Used well, technology facilitates those human moments. 

Video conferencing and webinars are only the beginning. Data analytics tools, such as WealthEngine’s WE Analyze tool,  lets you zero in on prospects who are the best fit for your services. 

This saves you time searching for potential customers so you can spend more of your day in one-on-one virtual meetings. Plus, you can find the prospects with the highest capacity, propensity, and intent to work with you.

WealthEngine makes this possible. Get in touch today for a free demo and see how WealthEngine can help you reach your goals during any financial climate.

 

The Impact of COVID-19 on Nonprofits and the Outlook for 2021

Impact of COVID on nonprofits

During a year of unprecedented times due to the COVID-19 pandemic, nonprofits and other businesses have dealt with waves of constant change and uncertainty. Throughout forced closures, months of remote work, and inconsistent reopening plans, nonprofits have constantly adjusted by implementing strategies like virtual nonprofit fundraising to stay afloat.

The Impact of COVID-19 on Nonprofit Fundraising

Impact of COVID on nonprofits through statistics

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All nonprofit organizations rely heavily on fundraising, especially through charity events, for operation. As the pandemic began to spread, many organizations had to adjust to remote work and face the harsh reality of event cancellations.

The beginning of the COVID-19 pandemic showed a bleak March and April. Most countries faced strict shutdowns and limited in-person interactions for essential business only. With heavy limitations on numbers for in-person gatherings, nonprofits began to shift their plans for scheduled fundraising events.

Forced closures of event venues called for previous fundraising plans to be revisited. Limited reopenings and event capacities also impacted plans while nonprofits were constantly adapting to the new guidelines.

Virtual Nonprofit Fundraising During a Pandemic

One of the major impacts seen by all industries during the COVID-19 pandemic was the sharp switch to remote working conditions and the cancellation of most in-person events. Adapting to these new conditions, nonprofits continue to strategize ways to make virtual communication effective.

Nonprofits that have successfully navigated through the pandemic relied heavily on digital marketing and fundraising tactics. Organizations switched their efforts to social media and email campaigns. Many planned in-person events became virtual fundraisers. Check out the previous link to download WealthEngine’s free step-by-step guide for successfully hosting these online events.

While organizations are still adjusting as new phases are implemented throughout different states, the emphasis on virtual fundraising allowed nonprofits to function during the pandemic. These continued efforts include virtual fundraisers, ongoing email marketing campaigns, and strategic social media content to keep donors engaged with the mission.

Effects of Remote Work on Nonprofits

As businesses shut down and employees began to telecommute, remote work became the new normal for most during the pandemic. This caused a heavy reliance on Zoom meetings, Slack, and email communications. 

The switch to remote work impacted the way employees performed their jobs. This change also caused adaptations in most aspects of daily life.

Working Remotely: Pros and Cons

The new normal that emerged in 2020 saw many employees navigating their new work-from-home environments with little preparation. The shift to remote work was abrupt, and organizations have begun seeing the pros and cons of having employees work from home.

Flexibility is a huge plus for remote work. Previously, many employees found themselves trying to balance their work and home lives, including things like child care and screen time hours. The lack of commute time and the ability to use their computer almost anywhere, means employees working remotely function on their schedules as needed.

Virtual communication can be a downside when working from home. Zoom calls and Slack messages make it hard for employees to connect. 

This can make collaborative efforts challenging. Without the usual office banter, workers can feel isolated and may struggle to effectively communicate with coworkers and complete projects.

Remote work presents another con due to the lack of work/personal life boundaries. Constant access to computers and no real separation between the office and home can make it difficult for employees to set clear working hours. 

Remote work has caused a shift in employee habits. Flexibility will remain a high priority for those working remotely long term.

Interacting With Donors

The COVID-19 pandemic halted most in-person meetings during 2020. For nonprofits that rely on donor interactions, this shift has impacted the way organizations communicate. 

While meaningful interactions with donors remain crucial to success, these conversations have moved online for the time being. Many nonprofit donors are seeing a shift to email and social media communications.

Content like newsletters and Instagram posts have played a huge role in keeping donors up-to-date. Virtual fundraisers have offered ways to connect and encourage continued contributions to the organization’s mission.

Due to the reliance on virtual communication, nonprofits have had to find new ways to engage with donors to maintain their relationships.

2020 Nonprofit Fundraising Statistics

infographic discussing the current state of charitable giving plans

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Nonprofit fundraising statistics play a significant role in predicting trends for the next year. With the unusual circumstances surrounding 2020, much of this data can be used to show exactly how the pandemic affected the nonprofit sector.

The impact of COVID-19 on nonprofit operations resulted in 75% of organizations making cuts to their budgets. This sounds concerning, but the ability to work virtually allowed for budget cuts that helped nonprofits stay afloat while adjusting to new pandemic guidelines.

During the second quarter, nonprofits saw a 7.2% increase in total donors. As the pandemic began to affect daily life, organizations were lucky to see more donors contributing to their respective causes. 

Overall, donations less than $250 saw a 19.2% increase. This means many organizations benefited from small donations made by new or existing donors during the COVID-19 pandemic.

GivingTuesday saw a 29% increase of donors on December 2nd with 34.8 million people participating in charitable giving. This led to a 25% increase in total numbers compared to money raised in 2019.

Despite a year of change and uncertainty, many of the statistics show a positive year for nonprofits.

Moving Forward: Long term Outlook and 2021 Predictions

As the pandemic continues to shape 2021’s economy, nonprofits will see the need for flexibility remain a key consideration in planning. With vaccine accessibility and downwards trending case numbers, it is possible for in-person work and fundraising to resume in 2021.

Nonprofits can expect an opportunity to build public trust in the coming year. There seems to be a continued trend with social justice movements and philanthropic giving. Virtual fundraisers and networking events may integrate into the new normal.

As the COVID-19 pandemic begins to wind down, nonprofits will continue to see lasting effects on their structures. Remote work may be the new normal, and digital engagement will remain important for donor retention.

Strategies for Nonprofit Membership Renewals

Membership is vital for the survival and continued functioning of any nonprofit organization. High membership numbers and their retention through membership renewals improve your organization’s effectiveness and ensure growth. 

There are many channels for increasing nonprofit membership renewals ranging from volunteering during fundraising campaigns to using professional agencies to track your potential customers and increase your organization’s brand awareness

Just 31% of offline-only first-time donors and 25% of online-only first-time donors are retained for more than one year. What is it that makes nonprofit membership renewals so difficult to retain? Are there ways to alleviate these issues?

Why Nonprofit Membership Renewal is Important

Nonprofit membership renewal is a constant, crucial process necessary to sustain your organization financially. Yet, nonprofits big and small alike typically experience a large percentage of membership turnover.

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Around 45% of all donors across the world are enrolled in a monthly giving program. Members of a nonprofit organization are generally more philanthropic than non-members. Thus, membership renewal is a vital contributor to an organization’s financial security.

Highlighting the Benefits of Nonprofit Membership

To appreciate the exchange that occurs between a nonprofit organization and a member, it is important for both parties to understand exactly what nonprofit membership entails. This will help the member understand all they are gaining through membership and the ways they can contribute to the success of the organization. 

By clearly defining the perks of membership and the important role committed supporters play in advancing the mission of your nonprofit organization, you incentivize strong renewal rates.

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  • Privileges

Make it clear what facilities, benefits, and other privileges members will enjoy as part of your organization. Will they be educating themselves by joining? Are there any new experiences they should look forward to? 

Whether members will be receiving a vote during the annual general meeting, a seat on the board, or simply a newsletter, remind prospects what nonprofit membership entails. 

Since many donors check histories and public records of organizations before opting for membership, it is very important to maintain transparency regarding what the organization has provided for its members in previous years. 

Provide specific examples of the benefits of membership via social media and include online testimonials as a means of building trust with your future members. Research shows that 72% of people trust organizations on the basis of online reviews and testimonials.

  • Duties

Nonprofit membership should be mutually beneficial to the member and the organization. Tell potential renewals and new members what they can do to aid your organization in its endeavors and how they can take full advantage of all membership has to offer.

Do you have donation programs in place? If so, make them transparent. Help members help you—they need clear guidance as to how they can promote your mission and vision.

Be it through membership drives, awareness-raising initiatives, or just gathering support, all members should have a detailed understanding of how they can further the goals of your organization. This will bring meaning to their membership and simultaneously boost the profile and activities of your organization. 

Membership contributions highlighted through social media reach a large number of your potential members. Therefore, it is important to look at your social media profiles, email campaigns, and newsletters regularly to analyze their impact on your membership renewal process. 

For example, if you notice that data-driven posts from your organization’s Facebook page get you more followers as compared to regular posts, then this shows your members are more inclined toward your organization’s progress numbers than its routine programs.

Strategies to Boost Nonprofit Membership Renewals

The chances for membership renewal increase when members are given complete clarity on the benefits they will receive from continuing their membership. They should also have an understanding of the benefits they would deliver to the organization. Thus, a two-way relationship is established 

You may use several effective strategies to boost nonprofit membership renewals:

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  1. Nurturing Members

Look after your members. Make sure a mentorship program is in place wherein senior members encourage new members to take an active part in events and organizational initiatives. This will help with the transfer of responsibility as junior members learn and grow into senior membership roles over time.

Nurturing members will help streamline the process of membership and ensure that your members respond positively to your requests for renewals. It will also act to create a bond between members and your organization. Renewals are more likely to occur when members feel that sense of connection with the organization and the people involved in it. 

  1. Looking to the Past

“Those who cannot remember the past are condemned to repeat it.” This is why it’s crucial to analyze data trends from preceding years and understand the shifts your organization has experienced in membership renewals. Factors you may want to consider include the average number of annual membership renewals, the average duration of membership, and activity (participation/donations) during membership.

You should also look at the demographics of your members—where and what age groups most of your donations are coming from. Analyze the reasons for this and consider how you can broaden membership appeal to a wider audience. 

Use donor segmentation to tailor membership renewal campaigns to groups with mutual backgrounds and interests to boost renewal rates among those demographics.

  1. Communication and Concerns

Make sure to promptly address any issues that arise with your members. Ensure that all lines of communication between your organization and its members are open and easily accessible. Proper and consistent communication goes a long way in avoiding misunderstandings. 

Making this extra effort demonstrates to your members that your organization appreciates them and prioritizes their concerns.

Be sure to request members renew via multiple platforms to ensure it remains top of mind. Nonprofit organizations have an email open rate of 25.50%, which means on average, three out of four emails you send will generally remain unopened. 

Using multiple communication channels increases the number of opportunities for you to remind members it’s time to renew. Tracking how existing members are responding to membership renewals can help you understand where miscommunication may be occurring and offer insight into where improvements can be made. 

Communication also allows you to understand if the renewal process is needlessly complicated. Streamlining the renewal process allows members to be comfortable and makes them more amiable. 

  1. Providing a 24/7 Online Membership Renewal Gateway

Sending your members email and text reminders with an attached 24/7 functional membership renewal link increases the likelihood of membership retention. 

Remember, membership renewal should be as simple and user-friendly as possible. Membership renewal that involves simple signup at a time convenient to your members is much more likely to be successful compared to a burdensome renewal process where members must navigate to your website and find a link themselves.

  1. Surveys

Surveys help you understand what your members want. They are a vital method of communication and validation. Surveys can also serve as a means to acknowledge donors’ expectations from your organization.

 A survey can collect important information that you can use to better understand what membership means for your organization. Careful consideration of this data allows you to see which members are more likely to be retained, enabling you to concentrate your efforts on these individuals.

Surveys may also assist you in identifying why some members choose not to renew. This kind of information is valuable for improving future member retention initiatives.

The fundamental keys to achieving positive nonprofit membership renewal rates are communication, remaining consistent and true to your organization’s mission and values, and making the renewal process as user-friendly as possible. 

To see how the WealthEngine W9 platform can assist your nonprofit membership renewal and acquisition efforts, sign up for a free trial today!