The Dentsu COVID-19 Pulse a Weekly Curation of Key Trends and Insights for Marketers and Brands

Home , 100 Humans, Ben Gibbard, Bleach (season 11)

COVID-19 Pulse

April 2nd Edition The Dentsu COVID-19 Pulse A weekly curation of key trends and insights for marketers and brands.

“We cannot choose the challenges we face, but we can choose how we respond to them.” –Greek Philosopher, Epictetus

It is becoming clear that COVID-19 presents a challenge unprecedented in modern times - disrupting nations, economies and lives in ways not thought possible a few weeks ago.

Our ability to respond to this change in productive and constructive ways depends on our ability to sift through the overwhelming torrent of news and information: to understand key dynamics and derive actionable insights that allow us as marketers to adap t in meaningful ways to safeguard and enhance the well-being of our people, our brands and our consumers.

It is in that spirit that we developed the Dentsu COVID-19 Pulse: to bring together and curate the most up-to-date information, insights and thinking from across the Dentsu network to help marketers navigate the shifting road ahead. We’ll be with you as we push through the immediate crisis into recovery and, ultimately, a return to growth. Our goal is to publish this report on a weekly basis.

A final thought (and silver lining). As you will see from our research in this report, consumers are looking for brands to take an active leadership role in helping them weather this storm. That means, more than ever, brands have an opportunity (dare we say mandate) to not just MARKET AT consumers as transactional buyers of products, but MATTER TO people as individuals and members of communities. As devastating as this crisis is, it offers a unique chance for brands to truly live their purpose. We stand ready to support you in this journey. 1. This Week’s COVID-19 Data and Headlines

2. Dentsu Media Marketplace Tracker

Contents 3. Dentsu COVID-19 Crisis Navigator

4. Cultural + Consumer Behavior Trends and Insights

5. Insights and Implications by Industry Vertical This Week’s Data & Headlines Global and US Snapshot (as of 4/1/20)

Global USA Confirmed Cases Deaths Recoveries Confirmed Cases Deaths Recoveries (+9%) (+12%) (+17%) (+15%) (+28%) (+59%)

859,031 42,322 178,100 188,578 4,054 7,251 China

Confirmed Cases Deaths Recoveries % Change % Change (+0.1%) (+0%) (+0%) State Cases from Deaths from Yesterday Yesterday

New York 75,983 13% 1,714 28% 81,518 3,305 76,052 New Jersey 18,696 12% 267 35%

California 8,548 15% 181 24% Italy Michigan 7,615 17% 259 41% Florida 6,741 18% 85 20% Confirmed Cases Deaths Recoveries Massachusetts 6,620 15% 89 59% (+4%) (+7%) (+21%) Illinois 5,994 19% 99 36%

Washington 5,482 4% 225 7% 105,792 12,428 15,729 Louisiana 5,237 30% 239 29% Pennsylvania 4,961 19% 63 24%

Source: New York Times, Worldometers, John Hopkins

World Leaders Invoking Executive Powers with Little China’s Factories are Almost Fully Back to Work Resistance China’s industrial machine is starting to show signs of recovery. China’s National The pandemic has caused world leaders to invoke executive powers and seize Bureau of Statistics said a measure of factory activity showed a rebound in virtually dictatorial authority. Israel's prime minister has shut down courts and March. The organization, which surveys purchasing managers at Chinese begun surveillance of citizens. Chile has sent the military to public squares factories, said activity rebounded to 52 on its closely watched index, from 35.7 in once occupied by protesters. Bolivia has postponed elections. In Hungary, the February. A number above 50 on the index indicates growing activity, though the prime minister can now rule by decree. Philippines passed legislation giving figure could overstate the improvement. It does not show to what degree factories President Rodrigo Duterte emergency powers and $5.4B to deal with the have resumed production, meaning those that have opened could still be pandemic. operating well below capacity. Invasive surveillance systems in South Korea and Singapore, which However, this does not mean the economy is entirely back on its feet. would have invited censure under normal circumstances, have been Cash-strapped families may be reluctant to spend. Chinese officials said praised for slowing infections. Critics say there are few safeguards to nationwide, major industrial enterprises are operating at an average of ensure that their new authority will not be abused. 98.6% of capacity, and nearly 90% of employees at these businesses are back at work.

Africa: Half of All Jobs May be Lost Austria Requires All Residents to Wear Face Masks Austria will require all residents to wear face masks when they shop for groceries Nearly half of all jobs in Africa could be lost because of the coronavirus. The starting this week, as experts question the prevailing guidance that healthy people UNDP warned that the crisis would disproportionately affect developing countries don’t need to wear masks. The WHO said that masks should only be worn by in Africa and elsewhere, taking a toll on education, human rights, basic food people who are sick and those who are caring for them, and that there is little data security and nutrition. Overpopulation, poor waste management, pollution and showing that they protect the general public in everyday life. But some experts traffic were all identified as factors that threatened a developing nation’s chances and government officials say they could offer some protection. Masks have been of recovering from a coronavirus outbreak. in short supply for front-line medical workers, and officials are trying to discourage hoarding and panic-buying by people all over the world.

Source: New York Times, Washington Post

President Trump Suggests Coronavirus FDA Grants Approvals to Use 2 Malaria Drugs Testing is No Longer a Problem The FDA has granted an emergency approval permitting the President Trump told governors that the chronic lack of kits to use of two long-used malaria drugs to treat patients who are test people for the coronavirus is no longer a problem. However, hospitalized with coronavirus, despite little evidence the drugs governors said it was a different picture on the ground. President would be effective against the virus. Trump also said many American companies were now producing ventilators and the US would soon have supplies to send to The decision allows companies to donate supplies of two hard-hit Europe. related drugs — hydroxychloroquine and chloroquine — to the Strategic National Stockpile. The drugs will then be distributed American companies like GE Healthcare and Ford are expected to hospitals for use in patients who have coronavirus. to produce 50,000 ventilators in 100 days. The President's comments indicate that the shortage of equipment will be ending The generic drug maker Sandoz, a division of Novartis, donated soon. 30 million pills of hydroxychloroquine and Bayer donated one million doses of chloroquine. Other companies are ramping up their production of the drugs and may donate more supplies.

Source: New York Times, WSJ, Washington Post

3 out of 4 Americans Will Calls to Free Inmates Healthcare Workers Are New York Mayor Asks for Be Ordered to Stay at Two weeks ago, the coronavirus Getting Sick Help as 911 System Home entered New York City's jail system. In emergency rooms and intensive Overwhelmed Fears have grown of the potential of a care units throughout New York City, Maryland, Virginia, Arizona and New York Mayor Bill de Blasio called public health catastrophe in the medical professionals are panicking Washington DC have issued stay-at- on the federal government to help cellblocks where thousands are being as their colleagues fall sick. home directives to try to slow the held in close quarters. provide critical equipment to the city’s overstretched hospital system. Some virus’s spread. People in Arizona will The federal government announced patients are now being left behind in have to stay at home till April. Florida 650 people have been released so that it was relaxing many of its usual their homes as the health care system governor has favored local action over far, but the rate of infection has safety standards for hospitals so they cannot handle them all. statewide mandates. continued to climb, and by this week, could expand services to fight the 167 inmates, 114 correction staff and pandemic — rules including what The city’s 911 system has been Roughly three out of four Americans 20 health workers had tested positive counts as a hospital bed; how closely overwhelmed by calls for medical are or will soon be under instructions and two correction staff members had certain medical professionals need to distress apparently related to the to stay indoors, as states and died. be supervised; and what kinds of virus. Typically, the system sees localities try to curb the spread of the health care can be delivered at home. about 4,000 Emergency Medical coronavirus before their hospitals are These broad but temporary changes Services calls a day. overwhelmed. will last the length of the national emergency.

Source: New York Times, WSJ, Washington Post, BBC

Social Media Conversations

• Mentions are up 2M from 3/30. • Conversation remains negative due to mentions of disease, deaths and crisis but users are expressing worries over coronavirus spreading through money, and people being afraid for grocery stores being cleared out.

Source: Netbase

Scams Taking Advantage of the Too Much Corporate Borrowing Will Healthcare Stocks Help Lead Wall Street Situation are Starting to Emerge Hinder Recovery Higher Stocks on Wall Street rose as investors bid up shares State and local authorities are receiving Federal Reserve Chair Janet Yellen said while the of health care companies as they reported progress complaints as scammers try to cash in on banking and financial sector was in “generally in good on products that could help with the outbreak. the panic. Scammers are peddling fake shape” ahead of the crisis, non-financial corporations cures and vaccines, soliciting donations to entered this crisis with enormous debt loads - Gainers included Johnson & Johnson, which said it phony charities, and selling needed items borrowing mostly for buying back stocks and paying had identified a lead candidate for a vaccine for the like masks, hand sanitizer and toilet paper at dividends to shareholders. virus and planned to ramp up both production and jacked-up prices. The corporate borrowing binge “creates risk to the clinical testing. Also, Abbott Laboratories rose on economy" and may trigger a wave of corporate reports that it had said a new test that could detect defaults. Highly indebted firms usually cut back a lot the virus in five minutes had been cleared for use by on investment and hiring, which will make recovery the FDA. Markets Improve difficult. US Stocks rose as government officials signaled that measures to contain the More Companies Announce Furloughs coronavirus pandemic are likely to remain in place for an extended time. S&P was up Companies that announced furloughs this week include Macy’s - 125,000 employees furloughed; Gap will furlough 3%, and Dow Jones up 3.2%. Both indexes 80,000 store employees; and media company – Gannett announced furloughs for those who earn $38,000 and have allied more than 15% since last week, above. L Brands also said it would furlough most store staff starting April 5. Fiat Chrysler is asking salaried but remain below February levels. employees to defer a portion of their salaries, while CEO will take a pay cut. Disney executives said they would take pay cuts as well.

Source: New York Times, Washington Post, WSJ

Already Struggling Community Banks Watch for Fallout

The economic fallout from the coronavirus poses a new challenge for small banks across the country. Most of America’s banks are woven into the local economy and a key source of credit for small businesses. As the downturn squeezes more industries, community banks must balance helping these businesses with protecting their own bottom lines.

Some community bankers say they have already started getting calls from businesses and individuals who say their cash flow might be tight for a while. Business customers have expressed interest in short-term loans and additional lines of credit.

China Moves Into Manufacturing BlackRockOverdrive Says Economy to Recover Steadily

BlackRock Inc. CEO Laurence Fink expects world economy to “recover steadily” from the coronavirus pandemic. Fink said the recovery will have steady momentum because the current market stress doesn’t rise to the magnitude of a typical financial crisis. Its roots aren't in insolvent institutions and investors collapsing from exposure to risky financial instruments. Central banks and governments worldwide have acted swiftly to shore up markets as well. However, he warned that heavily indebted businesses face deep challenges ahead.

Source: WSJ

• Last week saw the postponement of the 2020 Summer Olympics in Tokyo, affecting athletes, audiences, media companies, marketers and countries all across the globe

• Here in the U.S., NBCU will need to replace more than 7,000 hours of coverage across their platforms and delay, disperse or return over $1.5B in advertising and media commitments to this amazing global cultural platform

• This widens a hole created by the pause, delay or full cancellation of Live Sports seasons indefinitely – NBA, NHL, PGA, MLB, XFL and many others, including (potentially) NFL Football

• To add this, Entertainment-focused content production has ground to a halt, which will significantly impact the Summer and Fall schedules of BOTH ad-supported and non-ad-supported programmers

• All of the above of course impacts futures markets like the Upfront, which your Amplifi team is watching closely

• That said, consumers are still consuming lots of Linear & Digital content in the search for updates & information, and leaning into Streaming, Audio and Social for mental escape while they remain largely at home

• Overall, viewing is up week to week across ALL age groups • Across ALL viewing modes: • Linear • Time-Shifted • OTT • Linear viewing continues to hold the lion’s share of viewing for most older age groups • Much more balanced among the younger demographics • Increases in Streaming / OTT are roughly doubling Linear increases • The loss of sports GRP’s will have an impact, although offset with growth in news and general entertainment

• Streaming has increased 25% across all platforms (Alphonso) • On March 18, [Netflix & Amazon Prime] saw a 41% spike in viewership compared to a week prior (Samba TV) • Viewership on HBO’s direct-to-consumer streaming service has surged 40% since March 14 (HBO) • Netflix Top 10 in the US today (3/30)

Programs: Movies: • Tiger King • Uncorked • Ozark • The Platform • All-American • Blood Father • Self-Made: Madam CJ Walker • Badland • Love is Blind • Spenser Confidential • Car Masters: Rust to Riches  • The Occupant • The Letter for the King • The Angry Birds Movie 2 • Unorthodox  • 2012 • Boss Baby: Back in Business • Miracle in Cell No. 7  • 100 Humans • Outbreak

• Films Outbreak, Pandemic and Contagion have all populated the top 10 rankings of various streaming services

• 10x growth in watch time from day one to day 28 (U.S.) • “Study With Me” 52% increase in views YOY* • “Pantry Meals” 49% increase in views* • “Coping Techniques” 49% increase in views* • “At Home Workouts” 57% increase in views* • Tens of millions of search queries each day related to COVID-19 • Over the last month, billions of views on COVID-19 related content on YouTube • Reviewed over 100K and removed over 7K videos related to dangerous or misleading coronavirus information since early Feb • 95% of videos removed first flagged through YouTube's automated flagging systems • More than 70% of videos removed had 100 views or less

Link To Full DAN-produced Influencer/Brand Deck.

Engagement & Usage 10X downloads for Watch time across key 15%+ increase in 155% freezer 30%+ increase in Increase has lowered their desktop content categories up, average daily users recipe searches average daily users CPMs ~45% since mid- camera app – can aside from Sports: across OTT 170% work a thru week 11 Feb as many verticals be used in - Creators +48% (+25% avail from home tips pull back spend. conjunction with - News +35% impressions) 43% home org. Average user spends desktop video-conf. - Ent. +14% 73% self-care checklist 51 mins/day (GenZ Artists & Businesses capabilities Global share of 116% ‘daily-schedule’ and Millennials) leveraging IG Live conversation: 70% TV and Movies platform for - COVID-19 10.4% Helping to facilitate in- in-home viewing - Politics 9.1% home school, exercise - Ent. 12.7% and leisure activities

Source: Usage inf ormation prov ided by each indiv idual platf orm

Engagement & UsageAll are10X providingdownloads for Watch significant time across key donated15%+ increase in media155% space freezer to run30%+ increase in Increase has lowered their desktop content categories up, average daily users recipe searches average daily users CPMs ~45% since mid- andcamera amplify app – can governmentalaside from Sports: across and OTT societal 170% campaign work a thru week 11 Feb as many verticals be used in - Creators +48% (+25% avail from home tips pull back spend. efforts,conjunction with getting - News urgent +35% messagingimpressions) to audiences43% home org. Average user spends desktop video-conf. - Ent. +14% 73% self-care checklist 51 mins/day (GenZ Artists & Businesses capabilitiesnationwideGlobal on share the of platforms they 116%use ‘daily daily-schedule’ and Millennials) leveraging IG Live conversation: 70% TV and Movies platform for - COVID-19 10.4% Helping to facilitate in- in-home viewing - Politics 9.1% home school, exercise - Ent. 12.7% and leisure activities

Source: Usage inf ormation prov ided by each indiv idual platf orm

Versus week ago, total available impressions +6%; Sports impressions - 19% and News +10%

Source: Similar Web, week of 3/23 v s. 3/16; impression av ailability v ia Dentsu Internal Market Sampling Data

10% Reduction in spend across verticals week on week

Source: iProspect, weeks of 2/3 - 3/28/20

Source: Google, week of 3/18/20

Disclaimer: Please note that Google have shared this information with Dentsu under NDA.

Before sharing, please reach out to your Google account team to align on more specific consumer insights for your client.

Source: Google, week of 3/18/20

Disclaimer: Please note that Google have shared this information with Dentsu under NDA.

Before sharing, please reach out to your Google account team to align on more specific consumer insights for your client.

Source: Google, week of 3/18/20

Disclaimer: Please note that Google have shared this information with Dentsu under NDA.

Before sharing, please reach out to your Google account team to align on more specific consumer insights for your client.

Source: Google, week of 3/18/20

27% reduction in CPMs as a result of increased inventory

Source: iProspect, weeks of 2/3 - 3/28/20

VolumeVolume = Sizesize of of Bubblebubble

For this spotlight, FB highlights popular topics of conversation on Facebook related to COVID-19, using a combination of content consumption, total dwell time on posts (Volume), and change over time (YoY growth).

Source: Facebook, Feb 20-March 21/20; scale has been normalized between topics

Volume = Size of Bubble

Source: Facebook, Feb 20-March 21/20; scale has been normalized between topics

Kim Kardashian

Motown Anthony Davis Bread & Beyond Gone with the Wind WWE Smackdown Ken Anderson J.K. Rowling John McNally Food Network Kitchen (wrestler) George R.R. Martin Gilligan’s Island Ben Gibbard Jane Goodall Volume = Return of the Jedi E.T. Candy Land Size of I Still Believe (movie) Bubble Evan Rodrigues Recipe

Business as Nostalgic and Highlighting Filling time Celebrities usual comfort content athletes without screens pitching in

Source: Facebook, Feb 20-March 21/20; scale has been normalized between topics

• While overall numbers will be down, there are more people using radio and audio platforms versus a month ago • As measured by Nielsen: • 83% of American adults report spending the same or more time with radio as a result of the COVID-19 outbreak • More than 50% said that radio is a good source of information about COVID-19 and the associated restrictions, trust that what they hear on radio is accurate, and trust the information they get from their favorite radio hosts • 42% of consumers reported that radio has helped them deal with the outbreak • 46% indicated that radio helps them know what stores are open and where to shop locally

Source: Nielsen custom Radio Surv ey , 3/20-3/22/20

• Your Video Buying Teams are working closely with you and your clients to plot out how this traditionally fast-moving annual marketplace will unfold • Evaluating the traditional triggers around supply and demand, as well as overall economic conditions and content development

• As of today, we continue to believe the market will develop more slowly, but are evaluating on a day-to-day basis • A continued focus will be to maximize flexibility, opportunity and effectiveness and recommending only those investments that help grow your businesses

74% of buy-side decision-makers think Coronavirus will have greater impact on U.S. ad spend than the 2008-09 financial crisis

• Nearly a quarter (24%) of respondents have paused all advertising spend for the rest of Q1 & Q2

• Another 46% of respondents are adjusting advertising spend for the rest of Q1 & Q2

• Expect slightly less negative impact on Digital spend than on Traditional spend for Q1 & Q2, and a faster rebound for digital in Q2

• Impact on Q3 and Q4 spending is expected to be more modest

• 73% are indicating that the Coronavirus will have an impact on 2020/21 Upfront spend plans

• Expect a 20% decrease in Upfront spend vs original plan

Source: IAB Study of roughly 400 Marketers, Agency Buy ers and Planners (March 18-24/2020)

• Search & Social are least impacted

Link To Full IAB Survey Of Marketers, Agency Planners And Buyers

Source: IAB Study of roughly 400 Marketers, Agency Buy ers and Planners (March 18-24/2020)

When will sports return?

Where will the Olympics money go? To e-sports?

Will non-linear ad spend (OTT/CTV) rise to meet the growth of consumer usage?

Will performance marketing have a rebound in 2H?

Will there be any shift in support for news?

What are the spend differences by vertical category?

Source: IAB Study of roughly 400 Marketers, Agency Buy ers and Planners (March 18-24/2020)

As the scale and impact of the COVID-19 outbreak mounts, a flood of information has come out that tries to crystalize the current moment. While understanding the present is important, it is also important to acknowledge that it won’t last forever. Consumers’ understanding of this crisis is changing daily, with the situation unfolding at different paces throughout the country. As consumer attitudes and preferences evolve with the changing situation, marketers will need to shift their positioning in response.

To help marketers navigate the shifting road ahead, Dentsu will be regularly publishing findings from a consumer survey (weekly in the near-term). The goal is to track consumer sentiment over time. As the crisis unfolds, we will map how consumers are responding to help marketers understand how consumers are moving through the various stages of the crisis and how brands can respond.

This is an excerpt of a fuller report, which you can find here. 1. The Outbreak Is The Most Pressing Issue At Hand

2. Consumer Spending Is Decreasing

3. Consumer Media Consumption Is Increasing

Highlights of 4. Consumers Need Security & Reassurance Key Findings: 5. Consumers Expect Brand Action

6. Impact is Felt Strongest at Community Level

7. A Framework For Understanding Consumers’ Response

8. How Brands Can Reach Consumers In Different Stages

Source: COVID-19 Tracker, part of the Taking the Pulse series by Dentsu Aegis Network. Online surv ey panel, conducted f rom March 27-29, 2020. 1. The Outbreak is the Number One Issue on Consumers’ Minds Concern over the COVID-19 health crisis far surpasses other issues that typically characterize the American landscape such as climate change, immigration and gun control. Other top concerns are related to the outbreak, such as the US economy and unemployment.

Top Issues Concerning Consumers 63% (% of respondents who said an initiative was in their top 3 choices)

42%

32%

22% 20% 19% 19% 19% 19% 17% 14% 13%

COVID-19/coronavirus US Economy Unemployment Climate Change Immigration Terrorism Income Inequality Gun Control US Political Landscape Freedom of Movement Gender Equality Reproductive Rights health crisis

Q. Please pick the top three issues, in priority order, currently most concerning to y ou. Source: COVID-19 Tracker, part of the Taking the Pulse series by Dentsu Aegis Network. Online surv ey panel, conducted f rom March 27-29, 2020.

© 2020 Dentsu Aegis Network 40 2. Household Spending Patterns Tighten, Then Settle A significant amount of people have experienced an impact on their work and income. While a majority of consumers report a decrease in spending over the last two weeks, they expect their spending to largely stay the same over the next two-week period.

Income Impact Household Spending Impact

It has decreased It has stayed the same It has increased It will decrease It will stay the same It will increase

20% 40% 26% Say their ability to work has been impacted by the outbreak 35% 47% 42% Report reduced income due to 39% the outbreak 33%

The Past 2 Weeks The Next 2 Weeks

Q1 Do any of the f ollowing apply to y ou? Please select all that apply . . Q2. How has the COVID-19/coronav irus outbreak af f ected your (and (or) y our f amily ’s) spending in the past 2 weeks? Q3. How do y ou think y our (and (or) y our f amily ’s) spending may change in the next 2 weeks? Source: COVID-19 Tracker, part of the Taking the Pulse series by Dentsu Aegis Network. Online surv ey panel, conducted f rom March 27-29, 2020.

© 2020 Dentsu Aegis Network 41 3. Across the Board, Media Use is Up as People Stay Home Media time is up as consumers look for ways to fill their time at home. Digital mediums like social media, online news, streaming video and chat services are seeing the highest gains, while traditional mediums such as radio, newspapers and magazines see slight upticks.

Increase/Decrease in Media Use Compared to Normal

% of Respondents that said % of Respondents that said Net % Increase/Decrease In Channel More Time Less Time Time Spent

Social media 51% 11% +40

Online news 51% 12% +39

Streaming video services 49% 12% +37

Video chat or messaging +37 services 49% 12%

Live TV 45% 13% +32

Online video 44% 12% +32

Streaming music/audio 41% 13% +28

Recorded TV 36% 16% +20

Radio 29% 24% +5

Newspapers 28% 24% +4

Magazines 28% 24% +4

Q. Are y ou currently spending more, less, or the same amount of time using the f ollowing compared to how much y ou normally would? *Of those who said they use the f ollowing. Net intent was calculated by subtracting those who said they are spending more tim e f rom those who said they are spending less time on the f ollowing. Source: COVID-19 Tracker, part of the Taking the Pulse series by Dentsu Aegis Network. Online surv ey panel, conducted f rom March 27-29, 2020.

Current Need State

SECURITY 36% High Priority REASSURANCE 25% Consumers most strongly prioritize Security, Reassurance, Stability and Normalcy, broad STABILITY 24% notions that speak both to a desire to establish a new normal in the present as well as a desire to NORMALCY 23% know what the future holds. POSITIVITY 23% FREEDOM 22% Medium Priority DISTRACTION 21% Less prioritized are more superfluous needs like Fun, Inspiration and Distraction. These may INSPIRATION 19% become more important as the outbreak drags on. INFORMATION 18% EMPOWERMENT 16% Low Priority FUN 16% Companionship and Belonging are prioritized LEADERSHIP 15% to the least degree – perhaps reflecting the ability of modern technology to keep people connected SUPPORT 15% during crisis. COMPANIONSHIP 13% BELONGING 12%

Q. Thinking about how y ou are currently f eeling about the COVID-19/coronav irus outbreak, what are the top three things y ou need right now? *For def initions of the f ollowing need states prov ided to respondent, please see the appendix. Source: COVID-19 Tracker, part of the Taking the Pulse series by Dentsu Aegis Network. Online surv ey panel, conducted f rom March 27-29, 2020.

© 2020 Dentsu Aegis Network 43 5. Brand Actions Speak Louder Than Brand Communications As the impact of COVID-19 spreads to all aspects of consumer’s lives, they are open to a variety of initiatives from brands. While consumers do want to see communications from brands, actions speak louder than words. Consumers are most looking for brands to put people before profits – donating to those in-need and taking care of their employees – over simply acknowledging the outbreak. Initiatives Consumers Want To See From Brands (% of respondents who said an initiative was in their top 3 choices) 50% 48%

41%

34%

25% 22% 21% 19%

15% 14%

Brands donating Brands looking after Brands offering Brands responding to Brands helping me Brands Brands that help me Brands that help me Brands advertising as Brands staying silent time, money, their employees discounts at this time the outbreak get through my day acknowledging the contribute to the take my mind off of normal on the issue products, to outbreak response what is going on causes/those in need

Q. Many brands and companies are try ing to decide how best to respond to the COVID-19/coronav irus outbreak. Which of the f ollowing do y ou MOST want to see f rom brands? Please pick y our top 3 in priority order. Source: COVID-19 Tracker, part of the Taking the Pulse series by Dentsu Aegis Network. Online surv ey panel, conducted f rom March 27-29, 2020.

© 2020 Dentsu Aegis Network 44 6. Impact is Felt Strongest at Community Level Local government and local businesses are doing the best job meeting consumers’ expectations in handling the outbreak, while national government and other citizens are falling short. This indicates the impact of both the outbreak and the response is felt strongest at the local community level.

Evaluating Responses (So Far)

Q. How do y ou f eel the f ollowing organizations hav e or hav e not met y our expectations in handling the COVID -19/coronav irus outbreak so f ar? Source: COVID-19 Tracker, part of the Taking the Pulse series by Dentsu Aegis Network. Online surv ey panel, conducted f rom March 27-29, 2020.

© 2020 Dentsu Aegis Network 45 7. A Framework For Understanding Consumers’ Response Often, responses to pandemics follow a pattern. As the effects of COVID-19 impact communities at different rates, the following Stages of Social Response can act as a guide to monitor and profile shifting public sentiment. Our approach was to ask respondents to self-identify which of the following stages best represents their current situation in relation to the outbreak:

The Five Stages of Social Response

INITIAL SHOCK COMING TO GRIPS LIVING A NEW NORMAL MOVING INTO RECOVERY POST- CORONAVIRUS LIFE

The outbreak is spreading. I am I am modifying my daily routine. I am moving towards settling into a I feel there has been progress to I am reconnecting to work and life uncertain about how it might impact There are moments of frustration new routine while the outbreak is reduce the outbreak in the nation without having the threat of the my day to day life. I am feeling and anxiety, but I’m trying to focus evolving. My routine is starting to and my community. I feel we will outbreak hanging over me. I am confusion, fear or anger about on what I can control. feel familiar. return to normal soon. back to my routine from before. preparing. % of Respondents Who Currently Identify With Each Stage: 24% 33% 26% 10% 7%

Q. When it comes to a public health crisis such as the COVID-19/coronav irus outbreak, there are of ten “phases” of how the response unf olds. Thinking about how Further attitudinal analy sis rev eals that these cohorts are likely still in denial about the the outbreak has impacted y ou and y our daily lif e, which of the f ollowing phases best describes y our current situation? sev erity of the outbreak. Source: COVID-19 Tracker, part of the Taking the Pulse series by Dentsu Aegis Network. Online surv ey panel, conducted f rom March 27-29, 2020.

Initial Shock (24%) Coming to Grips (33%) Living a New Normal (26%)

Their view is still at odds with the reality of the outbreak Internalizing the ramifications, uncertainty is at a high Have adjusted the best they can on their own, need leadership

Outlook: Hold hope and optimism. Outlook: Macro-view is increasingly negative. Outlook: Micro-view is improving. • 50% (172i) believe that the health threat to their • 46% (128i) believe that the health threat to their • 60% (240i) say their personal finances are getting community is getting better. community is getting worse. better • 60% (200i) say their personal life is getting better Emotional Sentiment: Positive almost to a fault. Emotional Sentiment: Uncertainty is at its peak. • More likely to feel connected (186i) and hopeful • More likely to feel isolated (124i) Emotional Sentiment: Calm, cool, collected. (179i) • A sense of fear creeps in (123i) • Feelings of calm (103i) are at their highest compared to • Also more likely to feel helpless (147i) and report • Most likely to feel frustrated (135i) and bored the other stages frustration (110i) (120i) • They feel more prepared compared to the other stages (100i) Need State: Looking for guidance and support. Need State: The biggest unmet need is security. • Information (110i) • This group needs security far and beyond the Need State: Want to understand their trajectory. • Support (146i) others (133i) • Cohort with the highest ranking for normalcy (122i) • Companionship (121i) and leadership (126i) indicating they want to • Belonging (142i) Brand Expectations: Appreciate a helping hand. understand the trajectory of their situation • 48% (117i) think more of brands that “help me take Brand Expectations: A little goes a long way. my mind off what is going on” Brand Expectations: Expect brands to help, now they • 39% (118i) say they would think more of a brand • 47% (112i) think more of brands that “help me get want them to lead. that simply acknowledges the outbreak. through my day.” • 50% (109i) expect brands to “help me get through my day.” • The national gov’t and other citizens have fallen short of their expectations.

Source: COVID-19 Tracker, part of the Taking the Pulse series by Dentsu Aegis Network. Online surv ey panel, conducted f rom March 27-29, 2020.

INITIAL SHOCK COMING TO GRIPS LIVING A NEW NORMAL

Consumers need help Consumers are looking Consumers have adjusted adjusting and want to for empathy and a sense as best they can and need take their mind off the of connection. Brands brands to act as leaders. crisis. Brands can offer should adjust Demonstrate action at value by providing communications to offer macro level (help with experiences that a sense of hope and crisis) and micro level enhance/enable daily community. (add magic to the routines. mundane)

BRAND ACTION: BRAND ACTION: HELP BRAND ACTION: LEAD ACKNOWLEDGE

• Acknowledge the crisis • Take my mind off it • Be part of my routine • Reaffirm my hope • Provide a sense of security • Make me feel ‘normal’ • Provide information & connection • Help me get through my day • Step in where others aren’t

Source: COVID-19 Tracker, part of the Taking the Pulse series by Dentsu Aegis Network. Online surv ey panel, conducted f rom March 27-29, 2020.

© 2020 Dentsu Aegis Network 48 • Need states have reprioritized in favor of stability: Consumers are stripping down to the essentials as they prepare for an uncertain future. Brands should focus on the role they can play in consumer’s new routines.

• Media usage is up as people stay home: Digital & TV are seeing the highest gains, as they play multiple roles in consumer’s lives – social connection, entertainment and information. Brands should design content strategies around consumers’ media needs to benefit from increased attention and time spent.

• Brand actions speak loudly; silence speaks louder: Consumers are looking to brands to lead and to fill the void left by national government. Brands need to pivot communications to acknowledge the crisis and demonstrate the role they can play in helping (helping consumers, Key Themes & helping communities, helping society).

Implications for • Impact is felt closest to home: Consumers express highest satisfaction in responses from local government and local businesses. Consider localizing communications and defining your brand’s Marketers role in local communities.

• Brand expectations climb as consumers progress through the crisis: Consumers move from wanting acknowledgement, to help, to leadership. Brands who plan both shorter and longer-term responses will be most effective in reaching consumers’ shifting needs and maintaining a lasting relationship.

• Experiences matter more than ever: Consumers are settling into new routines they will need help navigating. Brands can add value by recreating experiences to fit these shifting habits and by enhancing consumers’ lives as new routines become mundane.

Source: COVID-19 Tracker, part of the Taking the Pulse series by Dentsu Aegis Network. Online surv ey panel, conducted f rom March 27-29, 2020. Survey Methodology This survey was administered through Toluna, an Thank you. online research panel, between March 27-29, 2020. Conducted by Dentsu, this survey was distributed among a random sample of 1000+ respondents, aged 18-64 years old and residing in the United To access the full findings, States. The survey controlled for nationally click here. representative weighting across age, gender and ethnicity. Additionally respondents represented a variety of backgrounds: educational, racial and geographic.

1. The Modern 2. Mobilizing for the 3. A Catalyst for Homestead Collective Good Resocialization

1. The Modern 2. Mobilizing for the 3. A Catalyst for Homestead Collective Good Resocialization As systems people rely on crack under crisis, anxiety is reviving an autonomous mindset.

Increasingly reduced spending… Bleak consumer outlook… Leading to decreased spending across non-essential categories. 73% of respondents believe their finances will be impacted by more than 2 months

Source: McKinsey & Co, Consumer Surv ey

Figuring it out, with a little help from Google: 5x Increase in search volume for “how to cut own hair men’s” over the past week

“how to take off acrylics" is trending

Source: The New York Times Source: Eater.com Source: Google Trends, COVID-19 Dashboard

Business Models: Create-Your-Own Neighborhood Technology: Create-Your-Own-Family

Between March 14, and March 16, 2020, Disney Plus signups tripled compare to the week before.

1. The Modern 2. Mobilizing for the 3. A Catalyst for Homestead Collective Good Resocialization As systems people rely on crack A collective sense that we will only under crisis, anxiety is reviving an get through this by coming together. autonomous mindset.

+3,650% Increase in search volume for “how to help others during coronavirus” over the past week

Source: Google Trends, COVID-19 Dashboard

+1,150% Increase in search volume for “thank you essential workers” over the past week

Source: Google Trends, COVID-19 Dashboard

1. The Modern 2. Mobilizing for the 3. A Catalyst for Homestead Collective Good Resocialization As systems people rely on crack A collective sense that we will only Social media is shifting from a space under crisis, anxiety is reviving an get through this by coming together. to share experiences to a space to autonomous mindset. create experiences.

One-way sharing is declining… The desire to participate is growing… % of global internet users who % of global internet users report “sharing details of my daily who use online forums, life” on social media: blogs, and/or vlogs: 2014 2017 27% 72% 2019 & 2019 20% 76%

Source: Global Web Index

Apps for direct connection are spiking From passive to active interactions online

© 2020 Dentsu Aegis Network 62 Creating New Ways To Experience Familiar Traditions Remote doesn’t mean alone. From meals to movies to concerts, creative initiatives and uses of technology are bridging the social gap.

Chipotle: Meal-time Together (with your Netflix & Instagram: Watching Together Twitch: Jamming-Out Together favorite celebrities)

• Reflect the Moment. Right now, consumers may not be keen to take action with your brand, but messages of support can reach them and position your brand as a partner for when they are ready to spend.

• Proactive Adaptation. Consider how to fit into new habits starting at home. Make existing resources work in surprising ways or think laterally.

• Act Like an Ally. Modern consumers were already looking for brands to prove their values. Now more than ever they will want to see how brand initiatives benefit their local heroes and communities.

• Deepen Connections. Reimagine your brand experience for the virtual age and ask how it can unite consumers either literally or through comradery.

Media & Entertainment CPG Slide 73 Slide 95

Travel & Hospitality Restaurants Slides 77 Slide 98

Auto Insurance Slides 80 Slide 101

Retail Non-Profit Slide 83 Slide 104

High-Tech & B2B Slide 87 Americans, largely unprepared, brace for prolonged economic crisis • Most Americans are not financially prepared for a prolonged coronavirus crisis. Two-thirds of U.S. adults are worried that COVID-19 will hurt their financial situation. Top financial concerns are: unexpected medical expenses (44% of those polled), inability to work enough hours (37%) and declining value of stock portfolios (33%)

• Banks and credit unions need to act as buoys of stability:. Banks should promote capabilities that can be provided digitally, such as remote capture, P2P transfers, and video chat as well as waive fees and delay payment due dates. Frequent updates should be posted concerning branch closures and other service changes.

• Among respondents with investment portfolios, 45% say they are not planning to make any changes to their investment strategies as a result of the coronavirus, 13% say they are planning to move some investments into cash and 12% say they see the current market downturn as a buying opportunity. Just Financial under one third of Americans (30%) say they do not have enough money invested in the market for it to matter one way or the other. Services • Most consumers are not turning to banks to understand how to manage their finances. Just 17% of Americans say they will look to their bank and just 16% say they will look to their financial advisors for advice to help them better manage their money during a crisis such as the coronavirus compared to 38% who say they will turn to family and friends and 36% who are not looking for advice. • This Week’s Headlines: • Bill Ackman’s hedge fund generates gains amidst stock market's huge losses: Bill Ackman recently disclosed $2.6B in gains to investors in his Pershing Square hedge fund. Ackman had hedges designed to generate a profit despite Pershing’s positions in restaurant and hotel stocks as

Source: jdpower.com, thef inancialbrand.com, the broader market tanked. These hedges were first disclosed in early March. aitegroup.com Industry Insights and Examples from the Previous Week

Many banks are leveraging video to communicate with customers. It feels more personal and conveys more support than simple text. Bank of America is use video to explain how to find ATMs in this time of need.

Huntington Bank has gone “all-in” to fully focus their homepage on the virus and their response for their customers. In the process they show empathy and support, Organizations must deliver a lot but also continue to highlight of information to customers, but acquisition opportunities with a should continue to use focused mortgage callout. messaging. PNC has a great straightforward execution about how to bank remotely.

Banks should highlight ways in which they are Brands are leveraging content marketing on supporting local communities and workers “on the affiliate sites to highlight services available. AMEX front lines.” Chase is communicating their is leveraging their native partners to both get the commitment to both nonprofits and small business. word out to their customers that they have options, These audiences are particularly vulnerable and but also to build brand sentiment with potential their support typically resonates strongly with prospects. customers.

Bank of America is not only educating customers on their preparedness, but also are educating on why some of these actions need to be done. They again are communicating that they are putting customers and their employees first.

$2T stimulus package has significant Consumer surveys indicate that more than half of consumers don’t believe their bank has shown enough implications for banks and lenders empathy during this crisis. While many banks are taking significant action to support customers, that message may not have yet met a broad cross-section of customers – especially those in the greatest need of assistance. • It delays implementation of a new accounting rule requiring banks to reserve for loan losses all at once, instead of spreading them out over the life of the loan. • Gives the OCC the authority to allow banks to make loans that would typically trip up size restrictions. Smaller community banks with less than $10B in assets get more lending flexibility through a higher maximum leverage ratio. • Banks will also get more leeway on how they account for troubled consumer loans, allowing them to work with struggling borrowers who have fallen behind on their payments.

JPMC announced commitment to spend $50MM to In partnership with Goldman Sachs, Apple Known for student loan refinancing, help address immediate and long-term challenges launched a Customer Assistance Program where SoFi released a new investment product from the coronavirus pandemic – will support enrolled Apple Card customers can skip March signalling an evolution from just loan refinancing existing non-profit partners for economic recovery payment and not incur interest. to the next financial step for graduates: of underserved communities, resiliency for investment services. A sweepstakes to vulnerable small businesses and emergency encourage sign-ups includes $1 million in stock healthcare and food prizes incentives essentials.

© 2020 Dentsu Aegis Network 72 Shelter-in-Place Drives Increased Media Consumption • As Americans stay home, Nielsen anticipates overall content consumption to increase by almost 60%. Prior to the crisis, media consumption was already at historically high levels.

• In the week ending March 22nd, US television use increased by 18% WoW. Viewership of live television rose by 14%, while the use of video-game consoles climbed by 35%. The increase in watching live TV was especially marked for teenagers (31%). In recent weeks, three-fourths of US consumers have been adding streaming subscriptions and TV connected devices, giving them even more media options.

• Overall internet usage rose by 28%, largely driven by a newly remote workforce.

• This Week's Headlines:

• Several of the Spring’s Biggest Cable Series Delayed Due to COVID-19: While cable networks that don’t Media & broadcast sports were excluded from the initial round of coronavirus-related ad sales frenzy, they are now dealing with the fallout as networks and buyers have enacted new strategies in the wake of COVID-19. Several of cable’s biggest and most anticipated shows this spring have been postponed until at least later Entertainment this year, as networks grapple with production shutdowns, a major upheaval in advertiser spend and concerns about what could happen to their content pipeline if production doesn’t resume for several more weeks or months.

• Media Companies Are Resorting To Pay Cuts Amid Coronavirus: Vice will cut salaries for top staff and halt retirement benefit-matching. Anyone making more than $100,000 per year would receive a pay cut, and some top executives will take a furlough and a 20-to-25% pay decrease while the company weathers the storm. CEO Nancy Dubuc would take a 50% pay reduction. BuzzFeed and media giant Gannett, which oversees USA Today and is the largest newspaper publisher in the country, both announced steep pay cuts for staff, citing sharp advertising revenue declines.

Source: AdWeek, The Economist Media & Entertainment | Brand Actions

Disney+ launched Frozen 2, two weeks early. Hulu is offering ABC News Live on current Hulu NBCU is sending “Trolls 2”, “the Hunt” and plans for continuous coverage of all the latest news other major movie titles that were headed to Disneyland will donate all of its excess food and live events on the novel coronavirus pandemic, the box office straight to streaming. to local charity during the Park’s temporary including a daily show on what you should know closure about COVID-19 and live updates from federal and Launched The More You Know campaign on local officials across the country. how to reduce the risk and spread of COVID- 19. The effort was created in partnership with the Ad Council, Centers for Disease Control and Prevention, the U.S. Department of Health and Human Services and the White House. It was shot on mobile devices and cameras available in the talent’s own homes and produced remotely.

With almost all US states closing schools until at least the end of the month, most children ages 6–12 are spending at least 50% more time in front of screens daily. SuperAwesome, a kids technology company, found overall kids are effectively going to be spending 2.5–3x more hours of day in front of a digital screen than they historically would have. Traffic to kids apps and digital services has increased by nearly 70% in the US.

• An increase in desktop: Usually most families would have a single tablet shared between siblings, but because of homeschooling there is a desktop spike. • Traffic from devices increase: Tablet traffic has nearly tripled, while phone traffic has nearly doubled as children use their parents' devices to access kids sites. Connected TV device usage is also high. • Gender split data: Shows girls are typically using chat apps and TikTok and have read more; boys are using games more. Digital engagement between genders is also increasing, as children try to make up for the lack of in-person contact at school. • Key channels where they spend time: Streaming video was the leader across all ages of kids 6–12+, followed by watching regular TV, then playing games. • Top streaming brands kids engage with: Netflix, followed by Amazon, YouTube, Apple and Disney+.

Source: Axios

ViacomCBS. Unveiled #AloneTogether, a multimedia PSA campaign in partnership with the Ad Council. The campaign has released mobile ads that encourages people to self-isolate and stick to recommended social distancing measures. #AloneTogether is fronted by the company’s portfolio of entertainment and youth brands, including MTV, Comedy Central, CMT and VH1.

Sesame Street. Sesame Street’s famous fuzzy residents star in Kid-Friendly PSAs about COVID-19. Elmo's famous healthy teeth PSA got a lyrical upgrade to reflect the urgent public health messaging needs imposed by COVID-19. Elmo dropped a COVID-19 remix of “Washy Wash” with some of Sesame Street’s other beloved Muppets in a series of animated music videos to teach young children how to wash their hands properly.

These timely content changes are all part of the Caring for Each Other initiative, launched by Sesame Workshop, the nonprofit educational organization behind Sesame Street, in partnership with the Ad Council.

© 2020 Dentsu Aegis Network 76 US Travel Industry Warns of $910B Coronavirus Losses • The global slump in travel due to coronavirus is anticipated to cause a $910B hit to the US economy, representing seven times the impact of 9/11.

• According to the US Travel Association, the travel industry underpins 15.8MM jobs, approximately 1 in every 10 Americans. 83% of the travel businesses that comprise this industry are small businesses. As of April 1 st, an estimated 6M travel jobs are at risk in the US. This loss in travel-related jobs alone will see the US unemployment rate double from 3.5% in February to 7.1% in April.

• Spending across all tourism-related sectors – lodging, retail, restaurants, transportation and attractions – will plunge by 78% in the next two months.

Travel & • This Week's Headlines:

• Airlines Pivot From Passengers To Cargo Amid Coronavirus Crisis: For the first time in 36 years, American Hospitality Airlines is flying two cargo-only flights from the U.S. to Germany. Other airlines, including Southwest Airlines, are following suit.

• United Not Offering Immediate Refunds for Canceled International Flights: The changes came as United and other airlines slashed flights in unprecedented numbers as travel demand has plunged due to government and business travel restrictions and traveler anxiety.

• Amtrak Adds Service Cuts and Warns of Travel Restrictions: Amtrak has reduced and suspended service across its network, temporarily reduce bookings in coach and business class by 50%. Daily ridership is down 90% systemwide, while future bookings are down 85% YOY.

Source: US Trav el Association, Forbes Travel & Hospitality | Brand Actions

The Four Seasons New York is offering In order to help college students travel JetBlue is donating free flights for its rooms free to medical workers for that home safely, Enterprise is waiving the incoming medical volunteers who are are self- isolating from family. “young renter fee” and reducing the heading to NY State. minimum rental age from 21 to 18 at all U.S. locations for students with a valid ID.

Delta. Amtrak. Envoy. Offering free flights to medical Updates customers about its service suspension to Launched a new blog series TeamEnvoy to highlight professionals. combat coronavirus. goodwill and stewardship stories during these trying times.

© 2020 Dentsu Aegis Network 79 Automotive Industry Under Economic and Trade Pressure, Reckons with Shutdowns and Government Directives • Global auto production could fall by as much as 1.4M vehicles this year due to shutter manufacturing plants. RBC Capital Markets adjusted its forecast for global auto stocks, stating that fallout from the coronavirus could result in 20% decline in US vehicle sales. Shares of publicly-traded US automakers were down approximately 30% to 40% in March • In addition to impacts on supply, the pandemic is impacting demand and shopping. As of March 22nd, US automotive retail experienced a 36% decrease in WoW foot traffic. In particular, China – the world’s largest auto market – has already seen automotive retail sales cut in half this year.

• This Week's Headlines: • US Senators Urge Delay of US-Mexico-Canada Trade Deal Start Date: A group of 19 US senators urged the Trump administration to push back the planned June 1 start date for the new U.S.-Mexico- Canada trade pact, saying the short time would add to pressures on US companies due to the spread of Auto the coronavirus. Senators earlier raised concerns about the auto industry’s ability to quickly comply with higher standards for North American automotive content under the new pact.

• US auto industry is already under immense pressure due to outbreak as most players have shut down their plants and with decreased sales this new pact will further increase pressure on auto manufacturers.

• Ford And GE To Produce 50,000 Ventilators In 100 Days: Following this 100 day period, Ford and GE will build 30,000 per month as needed to treat patients afflicted with the coronavirus. On Friday, March 27th, President Donald Trump said he would invoke powers under the Defense Production Act to direct manufacturers, including Ford and General Motors to produce ventilators. US auto manufacturers are already producing medical devices and equipment to deal with shortages of medical devices.

Source: Reuters, CNBC, Ford, NinthDecimal, CNBC Auto | Brand Actions

General Motors committed to dedicating space Hyundai and sibling brand Genesis are GE Healthcare and Ford Motor Company in plants to manufacture ventilators to address relaunching a recession-era program called announced plans to work together to scale up nationwide shortage. Assurance Job Loss Protection. The brands the production of ventilators. promise to make up to six months of Cadillac aired a new spot to respond to the lack payments for drivers who lose their jobs and Additionally, Ford has replaced all media with of financial security that many are feeling right have purchased or leased their vehicle a message about their coronavirus relief plan, now – offering flexible payment arrangements, between March 14 to April 30, 2020. their payment relief program and how they’ve OnStar crisis assist services, in vehicle Wi-Fi responded to previous disasters. data and shopping online and home delivery for new vehicle purchases.

Mercedes-Benz. Daimler. Shared about its dealers’ online Regularly shares tips from WHO services, complimentary pick-up and on how to stay active at home delivery. and safety measures.

Hyundai. Ford. Announced it will donate $2M to Shared a post about how to keep fight Covid-19 and shared about it your vehicle clean, including a on social media. video explaining how to do this.

Shared posts using #FlattenTheCurve with its car interior and tagline “Stay Inside”

© 2020 Dentsu Aegis Network 82 Containment Measures Cripple Most Retail, Foot Traffic • As more states announce stay-at-home orders, nearly all retail industries have reported significant foot traffic decreases. Even as consumers stock up at grocery and big box stores, many stores have implemented crowd control and limited store hours. By March 22nd, grocery store foot traffic had decreased 19% and big box store foot traffic had decreased 27% Wow

• As more states order the closure of non-essential businesses, discretionary activities disappear. As of March 22nd, WoW foot traffic dropped 75% for shopping malls and 86% for movie theaters. Automotive retail also experienced a 36% decrease in WoW foot traffic.

• Consumers are pivoting to grocery delivery and eCommerce to meet their needs, with grocery delivery sales up 60% over last year. 31% of households have shopped for groceries online in the last month; of that 31%, Walmart won the most online grocery converts with 58% of the share, Amazon took 14%, and Kroger accounted for 6%.

• This Week's Headlines: Retail • Neiman Marcus May Be One of First Major Retail Casualties: The luxury retailer closed its stores for an indefinite period, and is reportedly in discussions with lenders about filing for bankruptcy to ease its $4.3B debt load.

• Macy Furloughs Most Employees: As Macy’s temporary shuttered their 870 physical properties, the company placed 125,000 employees on furlough in the last week of March.

• Kroger Forms Employment Partnerships to Bolster Employment, Food Supply: In order to ensure an undisrupted food supply chain and help displaced workers, this effort includes a shared-resource model with companies in hard-hit sectors — such as restaurants, hotels and foodservice distributors — to temporarily flex employees to Kroger roles.

• Amazon and Costco Dominating Consumer Spending: With similar pricing and variety across product categories, Amazon and Costco are dominating consumer share.

Source: NinthDecimal, eMarketer, AdWeek Impact on Online Shopping Behavior

1 Americans are stocking up on meds and virus protection online Purchase of virus protection category of products have surged 817% during the outbreak. Americans are stocking up products related to cold, cough & flu products – purchases of these items increased by 198%, while online purchases for pain relievers increased 152%.

2 Online shopping to fill pantries and purchases of toilet paper Non-perishable foods such as canned goods and shelf-stable items are common staples in emergency preparation and online purchases of these items are up by 69% and 58%, respectively, also online purchases for toilet paper have spiked by 186%.

3 The youngest generations are particularly altering their purchasing behaviors 96% of Millennials and Gen Zers are concerned about the pandemic and its effects on the economy, leading them to change their behavior more dramatically than other generations, which includes cutting back on spending, stocking up on items, and spending less on experiences. 4 Men and Women’s Shopping Behaviors Vary Women are more likely to be concerned about the effects of COVID-19, but men are more likely to have it impact their shopping behaviors. One-third of men, compared to 25% of women, reported the pandemic affecting how much they spend on products. Additionally, 36% of men, compared to 28% of women, reported it affecting how much they are spending on experiences. Also, men are more likely to purchase online then women.

Walmart and the Walmart Foundation Commit $25 Offering a higher cashback rate and Nordstrom has joined forces with one of their Million to Global COVID-19 Response Effort. extended cashback at over 150 “stores” partners, Kaas Tailored, to have members of including ones that meet day-to-day needs their Alterations teams help sew masks that will The company has also rolled out contact payments such as grocery, education, health and be used and distributed by Providence Health in using Walmart Pay on the Walmart app. fitness, and pets Seattle.

Additionally, Walmart plans to hire 150,000 workers primarily for distribution and fulfilment centers. Starting pay for Walmart centers ranges from $15 to $19 an hour, with hourly pay for existing workers at fulfilment centers going up $2 an hour through Memorial Day. Those employees also can get $250 bonuses for referring new hires, who get $250 bonuses themselves

Bloomingdales. Amazon. Urges people to make their Thanks all the staff who are evenings special by doing working to cater to the needs of things that they would the people during the pandemic. have done (example – a date night) without the pandemic.

Abercrombie & Fitch. JCPenney. Posts various clothes that people In this poll on Twitter, JCPenney can wear on the weekends, at asks what people would want in home. The company urges their Easter baskets – as it begins customers to have “weekend Easter promotions, distracting feels” while staying at home. attention from the pandemic.

• With millions of Americans looking for new ways to pass their time at home, bandwidth for online services has come under immense pressure. Microsoft is grappling with a huge demand on its servers with over 900 million meeting and calling minutes a day and 44 million daily users. Netflix, Disney, and YouTube had reduced streaming quality to cope with extra demand.

• This Week's Headlines:

• Facebook Commits $100M to Support News Media Hurt by Virus Crisis: Facebook announced $100M in financing and advertising spending to support news organizations, including local US publishers. Facebook’s donation include $25M in emergency grant funding for local media, and $75M in marketing spend for news organizations globally.

• New Offering From Comcast Helps University Students Stay Connected: Universities are offering High-Tech online-only courses for rest of the semester. Comcast announced two free months of Internet Essentials for eligible low-income individuals that sign up over the next 60 days. Xfinity is now offering eligible university students who live in service areas and need internet service a Visa prepaid card worth about & B2B two months of internet service.

• Skype Users Surge 70% Amid Coronavirus Outbreak: Microsoft reported the number of people using Microsoft’s Skype video calling system has surged by 70% in a month to 40M people presently. Skype-to- Skype calling minutes jumped 220% from a month earlier.

• Big Tech Could Emerge From Coronavirus Crisis Stronger Than Ever: The pandemic has deepened reliance on services from the technology industry’s biggest companies while accelerating trends that were already benefiting them. Streaming services like Netflix, YouTube, and others are strengthening their share of content consumption; Amazon has fielded huge increases in shopper demand; messaging volume on Facebook’s WhatsApp has doubled; and Microsoft, Amazon, and Google’s cloud computing offerings have become essential to cloud workers. Source: Facebook, Reuters, Comcast, Forbes, Microsof t, CNN, The New York Times High-Tech and B2B | Brand Actions

Alphabet created a COVID-19 fund to provide Adobe is giving higher education and K-12 Facebook says it is prepared to dole out $100M to sick leave to affected workers globally, including institutional customers of their Creative Cloud small businesses to weather the economic all temporary staff, contractors, and vendors. apps the ability to request temporary “at- downturn. The program, called “Boost with home” access for their students and Facebook,” will provide grants to be used to cover Google granted free access to G Suite educators through May 31st at no cost and expenses like rent, employees and other operational and G Suite for Education to help available globally. costs. They anticipate 30,000 small businesses businesses/educators collaborate while they are could be eligible in 30 countries. Facebook also said work from home. Additionally, it will provide advertising assistance, and free ad the company promised $800 million in aid to small space for businesses marketing on the social and medium-size businesses, including $340 network. million in free ad space, and also announced the financial package to support businesses, health organizations and governments.

Dell. Comcast. AT&T. Regularly shares post on tips and best practices Announced 2 months of free Internet Essentials service Increased its mobile hotspot data and shared a related about remote work and work from home. and shared a social post with #InternetEssentials. social post. AT&T’s post came after Comcast announced its Internet Essentials offer.

CenturyLink. HP. Provides necessary infrastructure to connect USNS Mercy’s hospital ship Leveraging its 3D printing capabilities to help hospitals to create mask to the internet and shared a post about it on its social media channel. adjusters & face shields.

© 2020 Dentsu Aegis Network 90 Shelter-in-Place Impacting Americans’ Mental and Physical Health • With 3 in 4 Americans under shelter-in-place orders, the widespread health threat of increased loneliness, depression, and anxiety looms under the significant psychological and social stresses of this time. Coronavirus has struck at a time when more people are living alone than ever before in history. In the US, twenty-eight per cent of households were single-person in 2019—up from twenty-three per cent in 1980.

• Loneliness is linked to increased risk of heart disease and stroke, dementia, high cholesterol, diabetes, and poor health in general.

• This Week's Headlines:

• J&J Picks Up Top Coronavirus Vaccine Candidate; Human Tests to Start in September: J&J could disclose data before the end of the year, which then may allow the vaccine to be available for emergency use in early 2021.J&J said it will scale up its global vaccine manufacturing capacity so that more than a billion doses of Health & a vaccine can be made. • Google Makes COVID-19 Datasets Freely Available to Researchers: Google Cloud is offering researchers Wellness free access to critical coronavirus information through its COVID-19 Public Dataset Program, which will help accelerate analytics solutions during the global pandemic.

• Astronomical Costs of Coronavirus Hospitalizations: While coronavirus testing (when available) is free in the US, any resulting treatment may result in astronomical insurance bills. Those hospitalized with coronavirus can expect to pay anywhere from $42,486 to $74,310 if they are uninsured or if they receive out-of-network care.

• FDA Issues Emergency Nod for Chloroquine in COVID-19: Doctors can now prescribe chloroquine (medication used primarily to treat malaria) to patients without other options. In a recent study, 93% of coronavirus patients tested negative eight days into treatment with hydroxychloroquine and the antibiotic

Source: Vox, BioPharma Div e.com, Health IT Analy tics.com, azithromycin. The New Yorker, Stat News Health & Wellness | Brand Actions

Headspace released a special series of free-to- The US smartwatch brand announced the launch of a Peloton is offering free membership to new access guided meditations and at- home guided crowd-sourced data-collection campaign to be carried users to try out the app for 90 days. walking routines as well as offering free access out via its ECG watches. The campaign aims to to Headspace Plus for healthcare workers capture ECG data readings pre, during and post Covid-19 infection to help detect subtle changes in respiratory function. This data aims to provide a better understanding of the disease’s progression and increase early detection.

Sanofi. Regeneron. AbbVie. Showcases how they have been working across the Informs followers on Twitter about trials across the In this creative, on National Doctors’ Day, globe, and helping in the fight against the pandemic. globe, in collaboration with Sanofi. AbbVie expresses gratitude to everyone on the frontlines of care. In this creative, they talk about handling the supply of medicines for patients & prepare products for clinical trials.

Cigna. OHSU. Started the campaign #InformedonReform to keep people Urges people to exercise regularly, even while at home, to curb informed about various reforms being made during the anxiety, depressive symptoms for good mental health as well as pandemic. proper day-to-day functioning.

© 2020 Dentsu Aegis Network 94 Stock-up and Consumer Behavior Shifts Driving CPG Sales • By and large, CPG sales are soaring. Unsurprisingly, week-over-week sales show huge increases for certain products like disinfecting wipes (up 353%), hand sanitizer (up 73%), and chicken noodle soup (up 37%).Historically, CPG and food and beverage companies are the among the most stable businesses across economic cycles, including recessions.

• Consumer spending and shopping behavior will continue to shift as the pandemic progresses and recession worsens. Noticeable consumer shifts include: a decrease in brand loyalty as consumers try new brands in low- stock environments; continued stock-up behavior, particularly as consumers divert spending from restaurants and other away-from-home venues; and anticipated brand switching from mainstream to value brands, as more households struggle to make ends meet.

• The disruption to supply chains caused by the coronavirus pandemic, however, may result in significant financial CPG impacts for CPG brands. • This Week's Headlines:

• CPG Companies Rewarding Employees Working During Pandemic: Many food and beverage companies, including PepsiCo, Mondelez International and Hormel Foods, are giving bonuses or other benefits to employees who manufacture and sell their products during the coronavirus outbreak.

• Nestlé Running Full Time to Help Return 'A Calmness to the Market’: Nestlé has kept US shelves stocked amid a surge in demand. "That's the first step of normalcy – you show up to the grocery store and there is food on the shelf. We have a big part in returning a calmness to the market,” said Steve Presley, Head of US Operations.

Source: IRI, eMarketer, Food Div e.com, Forbes CPG | Brand Actions

Paying more than $4 million in special cash bonus Anheuser-Busch is now making hand sanitizer to Pledged $108 million (in retail value) in products to the workers in its plants who are busy address the nation-wide shortage. like soap, sanitizer, bleach and food for charities, producing food such as Spam and Skippy peanut about half going to the COVID Action Platform of butter during the coronavirus outbreak. Full-time ABI also announced it will redirect $5 million that the World Economic Forum. plant workers each get $300 and part-time it normally spends on sports and entertainment employees each get $150. marketing to the American Red Cross to support Additionally, the company pledged an additional the fight against the coronavirus pandemic. The $540 million in cash-flow relief for suppliers and nation’s largest sponsor of live sports and retail customers, which includes credit for small entertainment, also pledged to work alongside its retailers to protect jobs, and early payment for sports partners to identify arenas and stadiums that the most vulnerable small and medium-sized can be used for temporary blood drive centers. suppliers.

L’Oreal. Mondelez. Collaborates with Monica Gray, a Talks about mass-producing former Women of Worth honoree, to sanitizers as there is a high provide career guidance to students demand for those, but low via a Facebook Live series. availability.

Nestle. This video shared on Twitter showcases how Nestle is helping various stakeholders at this time of need.

© 2020 Dentsu Aegis Network 97 Restaurant Industry Facing Devasting Permanent Impacts • Roughly 110,000 restaurants are expected to close permanently in the US in April, with more than 30,000 already fully shuttered. Half of US restaurants cannot survive more than 16 days if cash flow stops; with prolonged containment measures and lockdowns across the country. Wide-spread layoffs have already taken place, with three million jobs already lost in the US and more anticipated to come.

• Total restaurant transactions in the US were down 36% YoY in the week ending March 22 nd. Orders at full-service restaurants – less-equipped for drive-thru and delivery orders – dropped by 71% for the week ending March 22. Fine dining sales dropped by more than 90%, casual dining dropped by 75%, fast casual dropped by 65%, and quick service/fast food by roughly 50%.

• The National Restaurant Association estimates that the industry lost $25B in sales in the first 22 days of March. US restaurants could take a $225B hit over the next three months, equal to a quarter of their projected 2020 sales of $899B. Restaurants • This Week's Headlines: • Coronavirus Lockdowns Prompt Smaller Restaurants to Rethink Delivery: Many restaurants are encouraging their customers to utilize discounted prices for delivery, using food delivery services. However, restaurants are struggling to pay monthly commission fees to these delivery service providers. A few delivery services said they would waive delivery fees for consumers on orders from more than 100,000 independent restaurants. Restaurants argued the moves didn’t go far enough, leaving them, not consumers, disproportionately footing the bill.

• US Restaurants Seeking $325B in Government Aid: In a letter to President Trump, Senate Majority Leader McConnell, and House Speaker Pelosi, the National Restaurant Association has requested immediate access to cash through a $145 billion Restaurant and Foodservice Industry Recovery Fund, as well as $100 billion of federally-backed business interruption insurance, $45 billion of loans, $35 billion of federal community block grants and tax reforms, and $130 million of disaster unemployment assistance.

Source: National Restaurant Association, Business Insider, The Wall Street Journal, Financial Post Restaurants | Brand Actions

Offering “Chipotle Together” virtual hangouts with In partnership with Lyra Health, Starbucks is In a large hiring push, the 4th-largest U.S. celebrities on Zoom. Each day this week, 3,000 offering its partners personalized, confidential pizza chain said that in most cases, job fans will be able to mingle virtually with celebrities mental health care, 20 free in-person or video applicants can expect to get an interview and in online chats that will also include codes for free sessions every year for partners and each of potentially start the same day. The chain entrées. their eligible family members. says it aims to hire up to 20,000 people. Chipotle is also using new tamper-evident packaging seals to reassure diners that food is untouched during delivery

Burger King. Pizza Hut. Red Lobster. On Twitter, Burger King urges people to be at home Informs customers that they are open during the Introduces family meal deals, which feeds a family of and be safe, while being as “weird” as possible. pandemic and also provides contactless delivery 4, delivered free and contactless. and carryout.

• US state legislators and lawyers have threatened to force the payment of coronavirus-related insurance claims. Congress is currently debating the need for legislation requiring insurers to pay for financial claim losses from companies suffering from shutdowns. Insurers insists their policies exclude pandemic coverage, and that retroactive amendments pose an “existential threat” to their business. The debate extends far beyond health insurance payouts, with industries from airlines to retailers to restaurants severely impacted by the pandemic.

• As a global recession looms, insurers face financial anxieties of their own. Globally, insurers manage more than $20 trillion in assets. At least half of these assets are invested in government bonds; US 10-year bond yields have more than halved since the end of 2019, while central banks’ interest rate cuts have sent yields plunging. Insurance • This Week's Headlines: • InsurTechs Helping Gig Economy Workers During the Pandemic: As the COVID-19 crisis unfolds, some InsurTech firms are working to further support customers and non-customers, focusing on gig economy workers facing intersecting issues of economic precarity and health concerns.

• Uncertain Impacts on Health Insurance Rates: Analysts for California’s insurance marketplace recently projected insurers nationwide could end up spending as much as $251 billion to cover care for coronavirus patients. If this pandemic is limited to 2020, premiums are not expected to increase for 2021; if the pandemic continues into 2021, however, insurers may be able to increase rates.

Source: Financial Times, Reuters, Property Casualty , Vox Insurance | Brand Actions

Aetna, a CVS Health company, was the first Allstate will automatically cover customers who use their major insurance carrier to announce that it will personal vehicles to deliver food, medicine and other goods waive member cost-sharing for inpatient for commercial purposes during the COVID-19 emergency. admissions at all in-network facilities for treatment of COVID-19 or health complications The company also announced a special payment plan that associated with COVID-19. gives auto and homeowner policyholders the choice to delay two consecutive premium payments without penalties.

State Farm. Allstate. Liberty Mutual. In this video, State Farm talks about “living a new normal” In this creative, Allstate informs customers that they Says that the welfare of their employees and customers where stores are closing, living rooms are the new offices, will automatically cover anyone who is using personal are their top priority and they are doing everything etc. With everything being different, State Farm says “we vehicles to deliver food, medicine or other essentials possible to keep their employees healthy and make sure remain the same” and are there to help customers facing for a commercial purpose. there are minimum disruptions to the customers. financial problems.

© 2020 Dentsu Aegis Network 103 The $2 Trillion Coronavirus Stimulus Bill Encourages Americans to Donate to Charity • The Coronavirus Aid, Relief and Economic Security (CARES) Act will let taxpayers deduct up to $300 in charitable donations from their taxable income. The rule will apply only to charitable contributions made in 2020. Taxpayers will be able to claim the deductions on their tax forms next year.

• The CARES Act temporarily creates something nonprofits have long sought: a “universal charitable deduction,” also known as an “above-the-line” deduction for donations.

• This Week's Headlines:

Nonprofit • Instagram Launched New COVID-19 Donation Section in Stickers: Instagram recently updated the Donation sticker in Instagram Stories to highlight organizations that are helping to fight the coronavirus.

Source: marketwatch.com, adweek.com Nonprofit | Brand Actions

The Gates Foundation is funding a project University of Florida researchers design The Fresh Market is hoping to raise $250,000 for at-home testing kits, delivered through an open-source ventilator from hardware in April to help feed those in need with their Amazon Care, to will allow people to store items. Five Million Meal mission. check if they have the coronavirus by swabbing their noses and sending As a national mission partner of Feeding samples back for analysis. America®, The Fresh Market is putting out a call-to-action to raise $250,000 by the end of April through a fundraising drive in all 159 store locations.

The Leukemia & Lymphoma Society. Save the Children. Arranged a Q&A session with Chief Medical Officer for Highlights an increased need for donations during this time coronavirus. crisis to help vulnerable children who are one of the most impacted by the crisis.

• Google’s ongoing dashboard of Coronavirus Trends

• A McKinsey survey detailing current consumer sentiment and behavior shifts.

• A great show of comradery and creatively executed ad by Vodafone Italy and a recognition of those on the front-lines by Budweiser as examples of brands getting it right.

• A well-written piece on how social media is changing in the time of coronavirus by TechCrunch.

• A must-read by The Drum: “Coronavirus is prompting brands and tech players to show the real power of purpose.”

• An article on how retail can bridge the social-distance gap that can serve as inspiration across industries, by Ad Age. This report was prepared through a broad collaboration of Dentsu agencies and functions.

About Dentsu Aegis Network Part of Dentsu Inc., Dentsu Aegis Network is made up of ten global network brands - Carat, Dentsu, dentsu X, iProspect, Isobar, mcgarrybowen, Merkle, MKTG, Posterscopeand Vizeum and supported by its specialist/multi- market brands. Dentsu Aegis Network is Innovating the Way Brands Are Built for its clients through its best-in- class expertise and capabilities in media, digital and creative communications services. Offering a distinctive and innovative range of products and services, Dentsu Aegis Network is headquartered in London and operates in 145 countries worldwide with more than 40,000 dedicated specialists. www.dentsuaegisnetwork.com

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