Business Briefs: Pandemic Entrepreneurs, Guerrilla vs. Ambush Marketing

Welcome to The Metropreneur’s newest series: Business Briefs. The world of academic publications features fascinating findings from real-world experiments in business and the marketplace. Here are some key takeaways and applicable nuggets of knowledge that may be helpful for your business.

Entrepreneurship and the Pandemic

The National Bureau of Economic Research issued a working paper this summer on entrepreneurship during the pandemic.

According to its dig into data from Business Formation Statistics, applications for new businesses have been surging since the second-half of 2020…at the highest pace in history. In lots of ways, that’s normally good news for job creation, growth and productivity. That said, the surge has occurred in particular areas; it’s not an across-the-board gain.

Fields that have expanded include non-store retail operations (pretty much online shopping); that chunk alone is about a third of the growth. Operations in the food and accommodations category have also grown, a notable trend in an area that has been hit especially hard in Ohio during the pandemic, first with operating restrictions, and then a labor shortage.

Other rapidly expanding areas include personal services, professional/scientific services, administrative services, and truck transportation. 

While this might be good news for productivity, it’s not yet clear that this surge will impact job creation. There’s been a big increase in what is called “non-employer” businesses; those operations that are staffed by a single owner/operator. Per the study’s author, this is a continuation of a trend that has been 10 years in the making. Many of the new businesses may just be more players in the gig, and side-gig, economy.  

Read more here

Entrepreneurship During the Covid 19 Pandemic: Evidence from the Business Formation Statistics – John Haltiwanger, National Bureau of Economic Research

Impacts of Guerrilla Marketing 

Guerrilla Marketing is a term that refers to unconventional marketing approaches. For example, an underwear company promoted itself by putting a pair of its (oversized) pants on the Wall Street Bull. It’s attention-getting, and often economical. 

The question is, does it work?

A recent study suggests there are sometimes promising payoffs.  Researchers looked at 803 examples over a 10-year span, and studied the subsequent share-price performance for companies that launched a guerrilla marketing endeavor.   

The researchers concluded that whether it works is wholly dependent on approach. The researchers reported that campaigns that appealed to emotions, especially joy, experienced the highest returns. On the other hand, negative returns were associated with humorous campaigns, as well as what was called “rational appeals” – straightforward guerrilla approaches that highlighted product quality. 

The lesson is: If guerrilla marking is your angle, the message needs to evoke joy.  

Read more here

The Effect of Guerrilla Marketing On Company Share Prices – Svetlana Davis and Frederick Davis, Journal of Advertising Research

On the Subject of Guerrilla Marketing . . . Ambush, Anyone?

Ambush marketing might sound similar to guerrilla marketing, but it’s not the same thing at all. Ambush marketing happens when a non-sponsor of an event manages to get itself associated with the event anyway. It’s been a recurring concern for Olympic organizers. Especially in an era of social media, which allows athletes to make posts that might involve products that are not official event sponsors. But it doesn’t just happen in the Olympics, it’s a concern for Ohio sports teams, and colleges, and any event organizer. 

A study in the latest print version of the Journal of Strategic Marketing  assessed the efficacy of sponsorship and ambushing. Published earlier online, researchers looked at how 368 sports fans felt about sponsors and also how they felt about ambushers. The good news for sponsors is that fans tend to associate sponsors with their respective sports teams. The bad news for sponsors is, the fans also tend to associate the ambushers with their respective sports teams. In fact, at times, the associations were more profitable for the ambushers. 

Organizational rules, and contracts provide some counterbalance for sponsors, but ambush marketing remains a prickly ethical dilemma for event organizers and promoters to navigate.

Read more here

Measuring Ambush-Marketing and Sponsorship Effects: A Football Consumer Response Approach – Nicolas Chanavat and Guillaume Martinent, Journal of Strategic Marketing