{"id":448,"date":"2020-03-30T15:31:11","date_gmt":"2020-03-30T13:31:11","guid":{"rendered":"https:\/\/digitaleconomy.org\/?p=448"},"modified":"2020-04-01T16:03:12","modified_gmt":"2020-04-01T14:03:12","slug":"how-consumers-deal-with-product-un-related-crisis","status":"publish","type":"post","link":"https:\/\/fromdatatoimpact.com\/index.php\/2020\/03\/30\/how-consumers-deal-with-product-un-related-crisis\/","title":{"rendered":"How consumers deal with a product (un)related to a crisis"},"content":{"rendered":"\n

A case study of Corona Extra beer<\/em><\/p>\n\n\n\n

by Andreas Bayerl<\/a>, Maximilian Beichert<\/a>, Christina Schamp<\/a>, Stefan Kluge<\/a><\/p>\n\n\n\n

<\/div>\n\n\n\n

The spread of the SARS-CoV-2 virus, known by the vast majority as Coronavirus, seems to be one of the greatest pandemics modern times have seen. In March 2020 more and more countries in Europe face lockdowns in order to isolate the virus and stop spreading it across the world. Severe economic and humanitarian consequences are the main concerns of our society which we might encounter in the near future. At the same time, across the ocean there is a Mexican beer brand called “Corona Extra”. <\/p>\n\n\n\n

\nConsumer research has evaluated from different\nangles how consumers react to similar stimuli or environmental cues\nin their shopping behavior. However, so far there are only few\nexamples addressing how a clearly negative associated event like this\npublic health crisis affects consumer behavior. \n<\/p>\n\n\n\n

Against that background, the coincidence of the two names motivated us to look at potential spill-over effects from the media buzz around the virus to (1) Google search volume of Corona beer, (2) follower base growth of the Corona beer brand\u2019s account on social media and (3) actual sales of Corona beer. <\/p>\n\n\n\n

Google Search Volume<\/h2>\n\n\n\n

In our first blog article (How a beer brand might benefit from a world-wide outbreak of a virus \u2013 The Corona Case<\/a>), we ran a Google-Trend Analysis comparing worldwide Google Search volume for major beer brands in comparison to Corona beer (see Figure 1). To our surprise, we found a strong upward trend for search queries related to Corona beer, while search volume for other American beers stayed at fairly the same level. Before the outbreak, the search terms showed parallel trends. <\/p>\n\n\n\n

A lot of media articles were cited and recited which stated that because of the Coronavirus Corona Extra beer sales are declining. These articles made it appear that there was a causal link between the virus and Corona beer sales because of the resemblance of their names. For example, CNN, the New York Post, and Vice all shared a survey among 737 participants in the US stating 38% are not considering to buy Corona beer anymore (e.g.: see Figure 2). <\/p>\n\n\n\n

However, this result might be taken out of context, as only 4 percent of Americans who regularly drink Corona said they would now stop drinking the beer (5WPR). It may well be that with an increasing number of countries on lockdown less beer will be consumed overall because fewer social gatherings take place. But this will affect the entire beer industry and not just the Corona beer brand. The right analysis here would be to compare a potential decrease of Corona beer sales controlling for the potential decrease of beer consumption across all other brands and for the whole product category.<\/p>\n\n\n\n

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Figure 1:<\/strong> World-wide Google Search volume during one week for major beer brands in relation to Corona beer<\/em> <\/figcaption><\/figure>\n<\/div>\n\n\n\n
\n
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Figure 2:<\/strong><\/em> CNN reporting about Corona Extra beer<\/em><\/figcaption><\/figure>\n<\/div>\n<\/div>\n\n\n\n

Follower base growth on social media<\/h2>\n\n\n\n

\nContrary to initial claims, one might therefore\nindeed wonder how a constant reminder of Corona might affect brand\nrecognition and loyalty of the beer brand. Indeed, being constantly\nexposed to the brand name might be \u201cfree advertising\u201d, however it\nis unclear how the negative connotation is spilling over to the beer\nbrand.<\/p>\n\n\n\n

To evaluate the consequences on brand recognition, customer loyalty and brand endorsement for Corona beer, we therefore analyzed the Twitter accounts of more than 50 beer brands before and after the outbreak of the virus. Before the outbreak, Corona beer does not show different patterns in increase of Twitter followers compared to the industry averages; the trends for Corona beer and the average of more than 50 other beer brands are almost parallel. However, consumer reactions appear to change for Corona beer after the pandemic outbreak: While the percentage increase of Twitter followers of the beer industry remained stable and close to zero, we observe growth rates in the number of followers of the Corona beer account of around 2%, moving from week n to week n+1 (see Figure 3). <\/p>\n\n\n\n

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Figure 3: <\/em><\/strong>Weekly percentage increase in twitter followers of more than 50 beer brands before and after the pandemic outbreak<\/em> <\/figcaption><\/figure><\/div>\n\n\n\n

Actual sales of Corona beer<\/h2>\n\n\n\n

\nIn a further step, we analyzed the sales volume of\nCorona Extra beer in a German supermarket for a time horizon of two\nmonths before and after the outbreak. Similar to the development of\nthe Corona Extra brand on Twitter, we identified a clear increase in\nsales volume after the outbreak of the virus (see Figure 4). \n<\/p>\n\n\n\n

Even though we cannot control for overall beer consumption, prior year\u2019s sales as well as prices and promotions in this analysis of raw sales volume, our results suggest that Corona might not been affected as negatively at this stage of the crisis as conventional wisdom might suggest. <\/p>\n\n\n\n

\nAs a further robustness check, we evaluated the\nraw sales data of a local beverage wholesaler. Again, the results\nreplicated that Corona beer sales were actually increasing from\nJanuary to March.<\/p>\n\n\n\n

Furthermore, one could argue that a comparison to other beer brands is necessary in order to derive a more robust result.<\/p>\n\n\n\n

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Figure 4:<\/em><\/strong> Daily Corona Extra beer sales in a German supermarket before and after the pandemic outbreak<\/em> <\/figcaption><\/figure><\/div>\n\n\n\n

Setting the Results in Perspective<\/h2>\n\n\n\n

\nMarketing research has evaluated how subtle cues\nand associations in the environment are driving consumer behavior.\nFor instance, Berger and Fitzsimmons (2008) demonstrate that\nconsumers are more likely to buy more orange products around\nHalloween when orange is a prevalent color in the US environment.\nTheir results show that products are more accessible, evaluated more\nfavorably, and chosen more frequently when the surrounding\nenvironment contains more perceptually or conceptually related cues.\nAs such, if consumers stand in front of the supermarket shelf, Corona\nExtra beer might become more accessible than other beer brands and\neasier to process. What is striking about our results, however, is\nthat this effect seems to occur independently from the sentiment of\nthe association. Clearly, Corona should transport negative\nassociations that, however, seem not to hinder purchases. This\nphenomenon has not been studied before. \n<\/p>\n\n\n\n

In addition, likely as coping mechanism to the potential crisis, consumers might also make deliberate \u201cfun\u201d purchases of Corona Extra beer. This explanation might be corroborated by an increase of \u201cironic\u201d and \u201cfunny\u201d social media pictures posted that link Corona Extra beer to the current health crisis.<\/p>\n\n\n\n

Limitations<\/h2>\n\n\n\n

\nWe caution that our analysis only reflects one\npoint in time, with sales data ranging from January to March. \u201cFun\u201d\npurchases or the positive spillover of negative associations might be\nonly a short-term phenomenon that might fade out after the introduced\nmeasures to fight the public health crisis. Follow-up analyses are\ntherefore needed to set these results in perspective. \n<\/p>\n\n\n\n

In addition, our results shed the spotlight only on one case example, illustrating how consumers might behave in unpredictable ways and how brands might have short-term success against negative associated environmental cues. Further examples are needed to evaluate these phenomena on a broader scale \u2013 we are grateful for your comments and ideas if you have further examples in mind!<\/p>\n\n\n\n

<\/div>\n\n\n\n

Title Image: Guido4<\/a>, Stefan Kluge \/ CC BY-SA<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

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