Brexit: Challenges and Opportunities for Marketers
The build-up to Brexit had us bracing for a Y2K-style blackout when the UK finally left the EU. But so far, the impacts have been more complex than dramatic (ham sandwich confiscations notwithstanding).
Whatever your stance on Brexit, it's clear that the transition will cause major changes for UK businesses in the coming months and years. We are gradually beginning to appreciate the challenges and opportunities those changes represent.
Many British businesses must now re-focus and re-prioritise to weather the upcoming turbulence. Here are a few ideas to keep in mind for those working in communications and marketing positions in 2021.
Brexit business impact #1: Delivery delays and fees
Logistical challenges around importing and exporting goods have led to delays in delivery times. In late January, freight volumes between the UK and the EU were down 38% compared to the same time last year.1
This is inconveniencing customers in both the UK and in EU countries, who report waiting up to two months for their parcels to arrive.2
Some British businesses have paused deliveries to the EU, with food producers citing "expensive health certificates and overwhelming paperwork"3 as a barrier to trade.
Extra delivery fees
Extra charges caused by tax changes and courier fees have been a nasty surprise for businesses and consumers alike. Which? notes that: “Some shoppers are being surprised with a 20% VAT charge from the courier delivering their order, who then passes that payment on to HMRC."4
The so-called 'Brexit tax' means that UK customers who buy goods over the £135 threshold from EU businesses must pay excessive fees to receive them. One woman recently reported having to pay almost £100 on top of a £265 order.5
Sales to Europe from the UK are similarly affected. Speaking to Vogue Business, Simon Cotton, CEO of Scottish cashmere fashion firm Johnstons of Elgin said: "We were all extremely concerned that the tariffs were going to be imposed. What we didn’t realise was that the cost of paying a carrier could exceed that."6
Opportunity #1: Brand reputation
Unfortunately, these issues won't go away any time soon. Delays and expensive fees are here until legislative change comes into effect.
From a communications perspective, then, there is an opportunity to preserve brand reputation during a time of turbulence.
Businesses can keep frustrations at bay by keeping their customers in the loop. One frustration for customers has been a lack of information specific to their orders. Rather than general mass-communication, businesses can improve their customers' experiences by providing personal, specific and regular communication about expected fees and delays.
- Make information as accessible as possible, so that customers know exactly what to expect
- Consider the right channels to communicate with customers, whether that's through key website pages, social media, email, or a combination
- Provide personal, specific and regular updates
Brexit business impact #2: Further barriers to exporting
Given the barriers to exporting, businesses from every industry are struggling to maintain their EU operations. Even prominent luxury businesses including Fortnum & Mason and Kate Spade New York have chosen to suspend sales in the EU for the time being.7
The limitations on exporting have also led to a decline in manufacturing. The Financial Times reports that: "Growth in UK manufacturing activity fell to a nine-month low in February, as Brexit trade barriers hampered the sector’s exports and its ability to secure raw materials and components from overseas”.8
Opportunity #2: Buying British
Some commentators expect that the barriers to exporting goods and services to the EU will see UK businesses pivot their focus to the domestic market. We have already seen calls to back British food and drink producers, while Scotland Food and Drink's Scotland brings so much to the table campaign seeks to educate consumers on how they can support the industry9.
A post-Brexit Britain could see more industries replicating similar initiatives in a bid to capitalise on the UK market. For those businesses seeking to adopt this approach, a total overhaul of their understanding of the British consumer is required.
Reacquainting themselves with UK customers will help to identify new focusses, products and services.
If choosing this route, companies should:
- Redefine their audiences, including their values and challenges
- Seek out opportunities to tailor their offering to UK consumers
- Reassess their brand proposition against a backdrop of changing consumer needs
Brexit business impact #3: Bricks and mortar retail business
Traditional bricks and mortar retail has struggled for a long time, but some speculate that Brexit will prove to be the nail in the coffin. JD Sports chairman Peter Cowgill has warned that "Bricks and mortar retailing is becoming uneconomic" due to Brexit's "double-digit millions" in extra costs.10
We've seen a move to online retailing for brands commonly associated with the high street, with brands like Topshop now operating exclusively online. Some expect more big-name retailers seeking to reduce costs by making a similar move in coming years.
Opportunity #3: Online retail
Companies setting their sites on online retailing have the opportunity to maximise their online presence. A tailored search engine marketing strategy can support both B2C and B2B retailing companies of every size. Learn more about search engine marketing.
Additionally, adopting a customer relations management (CRM) system like HubSpot can help your business to engage with your customers efficiently. To learn more about inbound marketing, head here.
To make the most of this opportunity, businesses should:
- Review their current search engine marketing practices to enhance online presence
- Streamline their customer communications practices by adopting an effective CRM
- Adopt a data-driven approach (it's best to work with a digital marketer with strong data analysis capabilities)
While there are certainly many obstacles to come, there are methods that businesses from every industry can adopt to try and mitigate them.
If you'd like help communicating through Brexit, get in touch with a member of the Moment team. We'll discuss how we can best support your business.