Retail takes record-breaking hit and Grey is the latest agency with furloughs: Thursday Wake-Up Call
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Retail sales dropped 8.7 percent in March, the biggest loss on record, fueled by millions of job losses and lack of disposable income in the wake of the coronavirus epidemic. The damage wasn’t uniform across industries: Clothing stores lost more than half their sales, while furniture stores and restaurants and bars fell 26.8 percent. As nonessential workers stopped their daily commutes in many states, gasoline sales at filling stations dropped 17.2 percent, compounded by low oil prices. Sales of cars and auto parts also fell 25.6 percent.
But not everyone is suffering. Food and beverage sales were up 25.6 percent, as homebound folks rediscovered the joys of sourdough bread, dried beans and day drinking. It’s likely that pantry hoarders pushed those numbers up in the early days of the pandemic, but with no end in sight to self-isolation, sales may stay high. Health and personal care stores, general merchandise stores and non-store retailers also saw a surge in sales.
Grey is the latest agency to furlough employees as a cost-cutting measure. The WPP shop put 3.5 percent of staff from its New York office on a furlough, which is expected to last for three months. Grey has reportedly instituted hiring and salary freezes, as well as voluntary salary reductions among senior employees, reports Ad Age’s Lindsay Rittenhouse. “Grey parent WPP CEO Mark Read had said he would be doing everything to avoid furloughing and cutting staff,” she writes.
The news follows a memo earlier this week from Omnicom CEO John Wren warning staff of furloughs and layoffs, while furloughs and salary cuts were also confirmed at Dentsu Aegis Network. Layoffs have already hit IPG’s MullenLowe, Giant Spoon and MDC Partners’ Anomaly.
Cheryl Bachelder, former CEO of Popeyes Louisiana Kitchen, has dire words for today’s marketers. “The options leaders face, such as how to stay open, keep employees and customers safe and maintain their businesses for the long term, are ‘lose-lose’ decisions because of the tension they carry,” she told Ad Age’s Jessica Wohl in the latest episode of the “Marketer’s Brief” podcast.
The crisis currently facing companies is unprecedented, Bachelder says, and that means executives are going to have to figure how to deal with the repercussions on their own, without the benefit of others' experiences. “There is no one leading in these times that’s seen anything like it before,” she says.
Though most agency creatives are stuck at home, that doesn’t mean their output has diminished. But isolation does seem to push copywriters and art directors in some similar directions, as examined by Ad Age’s Alexandra Jardine. Logo spacing, for example, was initially “a fun, creative exercise that brought a bit of levity during a dark time,” she writes. “But when brands do it for real, it opens them up to more important questions about whether they’re contributing anything substantial to the crisis efforts.”
Repurposed footage, solos shoots, Zoom backgrounds and leaning into the joys of home all make an appearance in the top 10. Sound familiar? “If brands can give people a lift in these anxiety-ridden times, it could work in their favor, but they need to tread carefully. Images of happy families in close quarters may not sit well with those who are alone and isolated,” Jardine writes. “A fast feeder telling people to eat junk food while stuck to the couch may not be the best idea when obesity is thought to contribute to coronavirus complications.”
In a portent of what might be coming elsewhere in the world, Amazon has temporarily suspended its operations in France. Warehouses and deliveries will be shut down for five days, the New York Times reports, to allow the e-commerce giant to improve health protections for its 10,000 workers in the country who are keeping their compatriots supplied with food, medicines and all manner of goods.
French courts had ordered Amazon to cease deliveries of all nonessential items until it improved safety measures, levying a fine of nearly $1.1 million per day for each day it did not comply.
This is the first time Amazon has bowed to pressure from a government to improve its handling of workers’ health during the coronavirus pandemic. Worries in the U.S. are growing of warehouse workers falling ill and handling goods and groceries that are being delivered to housebound people, and the company has fired at least four workers who say they were terminated because they spoke out against the company’s warehouse policies.
For tomorrow we diet: Competitive eaters make a living by pushing the boundaries of good taste. Now they’re bringing the boardwalk to the living room with the BetOnline Quarantine Challenge. Nathan's Famous Fourth of July Hot Dog Eating Contest champion Joey Chestnut joins seven other top-ranked eaters in a tournament that kicks off tomorrow, beginning with two pounds of sliced bologna in the qualifying round,” writes Ad Age’s Jessica Wohl. “The quarterfinals items are one family pack of Oreos and a half-gallon of milk. The semifinals feature 1.125 gallons, or 10 pounds, of baked beans. The winner will be crowned after being the first to finish 10 individual cups of ramen.” In addition to prize money, the tourney is also making a $10,000 donation to Feeding America.
Dope video: Is there anything videoconferencing apps like Zoom can’t do? The U.S. Anti-Doping Agency is looking into drug tests conducted via videoconferencing, starting with 15 volunteers. But if sports are canceled, then who cares? Apparently, dopers could use a gap in testing to make big gains before going clean again, giving them a huge advantage over athletes who don’t cheat the system during a time of crisis.
Crafty messaging: A new ad campaign from Etsy encourages buyers to support their favorite sellers, who are still churning out wares in the same, isolated home production facilities they’ve always used. “Etsy is marketing merchandise categories around self-care and home décor as many consumers are housebound under lockdown orders,” writes Ad Age’s Adrianne Pasquarelli. “Indeed, 'face mask’ has been the most frequently searched term on Etsy in the past two weeks, and the number of face mask sellers has increased five-fold in the last two weeks to nearly 20,000, according to an Etsy spokeswoman.”
That does it for today’s Wake-Up Call. Thanks for reading and we hope you are all staying safe and well. For more industry news and insight, follow us on Twitter: @adage.
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