Marketing Innovation for SMEs during COVID-19 Pandemic: A case study of the hospitality industry in Norrbotten

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Marketing Innovation for SMEs during COVID-19 Pandemic

A case study of the hospitality industry in Norrbotten

Simon Larsson Simon Gustavsson

Business and Economics, bachelor's level 2020

Luleå University of Technology

Department of Business Administration, Technology and Social Sciences

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Acknowledgement

This degree project was the last assignment in the process of completing our studies at Luleå University of Technology. For Simon Larsson, this means the completion of the program Economy Candidate, specialization in marketing. For Simon Gustavsson, this means the completion of the program International Economy Candidate, specialization international business administration. This study was conducted during the spring of 2020 (April - June) and provided an insight on how small and medium sized enterprises (SMEs) in the hospitality industry in Norrbotten was affected by the COVID-19 pandemic (coronavirus), along with how the SMEs adapted a new way of marketing during the economic crisis derived from the COVID- 19 pandemic.

There are several people involved that have contributed to this degree project from the beginning to the end of the study period. First of all, we would like to thank and show our gratitude to our supervisor, Seyedeh Fatemeh Mostafavi Shirazi, who supported us with advice, expertise and experience. We would also like to thank the interviewed participants for their contribution to this degree project by providing their expertise. Furthermore, we would also like to thank our fellow students that during the term has given advice on how to improve our degree project. At least but not last, a big thank you to our families that has supported us during this study period.

We are proud to say that we after a period of time have completed our Degree Project.

Luleå, May 2020

Simon Larsson and Simon Gustavsson

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Abstract

As a global disaster, the COVID-19 pandemic (coronavirus) has an impact on the whole world economy. The pandemic threatens the survival of small and medium sized enterprises (SMEs) globally and nationally. It appears inevitable that this pandemic has created a difficult business environment for small and medium sized enterprises to operate in. The COVID-19 pandemic has caused a chain of events that have led to an economic crisis. The driving factor have been the Swedish government’s recommendations to the population to stay at home and exercise social distancing. This has led to a declining household consumption in Sweden and thus also reductions in production in the country. Thus, the purpose of this degree project was to examine how three small and medium sized enterprises businesses adapted their way of marketing in order to survive the economic crisis that came with the COVID-19 pandemic. The research has been conducted within the context of three small and medium sized enterprises (SMEs) in the hospitality industry in Norrbotten.

To gain deeper knowledge on how SMEs in Norrbotten changed their way of marketing during this economic crisis, a qualitative research approach was pursued. A multiple case study was administered against three contrasting organizations in Norrbotten to collect data in order to delve into the chosen subject more. The gathered data was collected through interviews.

The findings of this study prove that the three small and medium sized enterprises were affected by the economic crisis that came with the coronavirus. Overall, the main findings show that the three SMEs adapted and improved their marketing mix as a response to the crisis. The key factor in why the three companies had to improve their marketing mix was the change of the consumer buying behavior. The changed customer behavior was a result of the Swedish government and the Public Health Agency measures to prevent the spread of the virus: social distancing, traveling restrictions and closed borders.

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Sammanfattning

Som en global katastrof har COVID-19-pandemin (coronaviruset) en påverkan på hela världsekonomin. Pandemin hotar små och medelstora företags överlevnad både globalt och nationellt. Det verkar oundvikligt att denna pandemi skapar en besvärlig affärsmiljö för små och medelstora företag (SMFs) att hantera. COVID-19 pandemin har orsakat en händelsekedja som har lett till en ekonomisk kris. De drivande orsakerna har varit den svenska regeringens rekommendationer till befolkningen att stanna hemma och utöva social distansering. Detta har lett till minskning av hushållens konsumtion i Sverige och därmed också en minskning av produktionen i landet. Därav har syftet med detta examensarbete varit att undersöka hur tre små och medelstora företag har anpassat sin marknadsföringsstrategi för att överleva den ekonomiska krisen som medföljt COVID-19 pandemin. Forskningen har bedrivits gentemot tre små och medelstora företag inom besöksnäringens i Norrbotten.

För att få djupare förståelse och kunskap om hur små och medelstora företag i Norrbotten förändrade sitt sätt att marknadsföra under denna ekonomiska kris (som kom från coronaviruset) genomfördes en kvalitativ forskningsstudie. En multipel fallstudie upprättades med tre små och medelstora företag i Norrbotten för att samla in data för att fördjupa sig inom det valda ämnet.

Den insamlade data kom från intervjuer från tre respondenter i tre små och medelstora företag inom besöksnäringsindustrin i Norrbotten.

Resultaten av denna studie visar att de tre studerade små och medelstora företagen påverkas av den ekonomiska krisen som kom från coronaviruset. Sammanfattningsvis visar resultaten att de tre små och medelstora företagen anpassade sin marknadsföringsmix som ett svar på den ekonomiska krisen. Den centrala orsaken till varför de tre företagen uppgraderade sin marknadsföringsmix var konsumentens förändrade köpbeteende. Det förändrade köpbeteendet var ett resultat av den svenska regeringens och folkhälsomyndighetens åtgärder att hindra smittspridningen av coronaviruset: social distansering, reserekommendationer och stängda gränser.

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List of Figures

Figure 1 - Economic crisis linked to the marketing mix 4

Figure 2 - Outline of thesis 5

Figure 3 - The Marketing Mix 12

Figure 4 - Summary of Methodology 30

Figure 5 - Overview of consequences and actions brought by the COVID-19 pandemic 51

List of Tables

Table 1: Frame of reference for research questions 17

Table 2: Interview types 21

Table 3: Interviewed respondents 24

Table 4: Types of Validity Tests 26

Table 5: Experience of decreased production due to supply chain disruptions 40 Table 6: Experience of reduced workforce among the companies 41

Table 7: Economic crisis financial impact on SMEs 42

Table 8: Changing consumer behavior affection on the companies 43 Table 9: The number of companies that have made improvements in the market mix 44 Table 10: Product innovation as a response to an economic crisis 45

Table 11: Pricing strategy in an economic crisis 46

Table 12: Changes in the distribution chain toward the customers 47 Table 13: Adaption of marketing during an economic crisis 48 Table 14: Comprehensive table of marketing mix adjustments 49

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1. Introduction

The following background will give an overview on how SMEs in the hospitality sector have to cope with the current COVID-19 pandemic - from a marketing perspective. Moreover, a problem discussion is presented in this chapter which allows the purpose of the research to be given, along with the stated research questions. At last, an overview and outline of the entire thesis will be provided.

1.1 Background

Companies are today managing businesses in a highly interrelated international business world (Alhawari et al., 2012). Companies are therefore more exposed to abnormal and unexpected events such as a crisis, since it constitutes new risks and an unpredictable business surrounding.

For companies that are not adequate to adapt in time of crisis, it can be challenging to have a sustainable profitability or even survive (Darbonnens & Zurawska, 2017). As this thesis is written the world is in the midst of an economic crisis derived from the corona-pandemic outbreak (COVID-19), which is affecting businesses all over the world.

The coronavirus outbreak was officially declared as a pandemic in March 2020 (WHO, 2020) and in early February the first case was detected in Sweden (Statista, 2020). As this thesis is written, the country has 20 300 confirmed cases where the region Norrbotten has 243 confirmed COVID-19 cases (Statista, 2020). The COVID-19 pandemic has caused a chain of events that have led to an economic crisis. The driving factor has been that governments all over the world have advised their population to stay at home and practice social distancing, which has led to a declining household consumption and thus also reductions in production (Statistics Sweden, 2020).

In a survey by Norrbottens Chamber of Commerce (2020) it shows that the corona crisis has caused damage to the business sector in Norrbotten and that over 70 percent of the firms have taken measures to reduce their costs. The survey also confirms the image that the hospitality industry (i.e. hotel, restaurant, tourism, travel, cafes) and small and medium sized enterprises (SMEs) have been hit hardest so far. A SME is according to EU’s definition a company that employs less than 250 people, and has either a turnover that is not more than EUR 50 million or

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Almost 80 percent of the SMEs in Norrbotten have already been affected directly or indirectly by the coronavirus. Demand has decreased for two-thirds of the firms. Cashflow has already negatively affected 60 percent of the firms and 68 percent of the firms see long-term negative effects of the corona crisis (Norrbotten Chamber of Commerce, 2020).

99.9 percent of all companies in Sweden are small and medium sized companies. They create employment for 70 percent of the total labour force and since 1990 they have created more than 4 out of 5 jobs every year (Yazdanfar et al. 2015; Yazdanfar & Öhman, 2018). SMEs are considered to be an important factor in a market economy and a great source of national economic growth (Haltiwanger et al 2013; Decker et al. 2014). However, SMEs are likely to be the ones who are most negatively affected in times of crises. Since they are vulnerable with their, in general, inferior financial- and human resources when it comes to responding to the consequences compared to multinational corporations (Vargo & Seville, 2011; Cesaroni et al.

2020).

A suggested tool in order to deal with an economic crisis for firms with limited resources (many times SMEs) is to adopt marketing innovation (Naidoo, 2010). Marketing innovation is defined as the application of a new marketing strategy with changes in product design, pricing strategy, packaging and product placement (Varadarajan, 2018). When a crisis hits the organizations, in this case the hospitality industry, they might need to adjust and change their marketing strategies (Karlsson & Tavassoli, 2016). In those cases, it is vital for firms to remember that the adaptation of a new way of marketing should avoid cutting expenses of marketing (Köksal & Özgul, 2007).

A good first step to adapt the marketing strategy might be to reevaluate the marketing mix and realign the value offered in order to please customers changed demand, due to the crisis (Karlsson

& Tavassoli, 2016; Falk, 2013). Empirical results also show that marketing innovation activities positively influences the economic profitability for firms in the hospitality industry (Nieves &

Diaz-Meneses, 2016).

Although changes in the marketing mix (i.e. product, price, place, promotion) have been proposed as a feasible strategy for companies that face a crisis, little research has been directed at empirically proving this, at least in the context of SMEs (O'dwyer, Gilmore & Carson, 2009;

Naidoo, 2010).

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1.2 Problem Discussion

When an economic crisis hits and the turnover rate declines, it might lead to bankruptcies (Yazdanfar, Öhman & Homayoun 2019). The declining turnover also contributes to decreases in innovative activities, mainly because new product innovation is expensive (Peric & Vitezic, 2016; Grewal & Tansuhaj, 2001). Nonetheless, the use of innovativeness in marketing could present an attractive solution for cash-strapped firms in order to survive in an economic crisis (Naidoo, 2010). However, there is not much previous research that has investigated or been able to prove marketing innovations' impact on firm survival in an economic crisis (Naidoo, 2010).

As a consequence of the COVID-19 pandemic, governments all over the world have advised their population to stay at home and practice social distancing, which has led to changed customer preferences and firms have to adapt to that in order to stay profitable and competitive (Statistics Sweden, 2020; Fernandes, 2020; Karlsson & Tavassoli, 2016). The changes in customer needs is something that has affected every industry in the business sector (Statista Sweden, 2020). Since marketing innovation is a tool for firms in order to adapt to consumer needs, and includes innovations such as advertising innovation, distribution innovation, promotion innovation and pricing innovation (Naidoo, 2010; Varadarajan, 2018). A successful implementation of that kind of innovations will help firms to better match customer needs and in turn also help them to gain a competitive advantage (Anning-Dorson et al. 2018; Karlsson & Tavassoli, 2016).

The marketing mix (i.e. the 4P’s) is the mechanisms the organization can use to create customer satisfaction and to stay competitive within the market (Karlsson & Tavassoli, 2016). It is considered to be a dynamic model since it adapts to change in consumer preferences, market condition and government policies (Singh, 2012). Hence, it is a vital tool for firms in the hospitality industry in order to adapt to the changes within the marketing environment and find a new way of marketing to stay competitive and profitable (Karlsson & Tavassoli, 2016).

The coronavirus pandemic has created an economic crisis that so far has required actions that the world has not experienced before (Fernandes, 2020). Since every crisis is more or less unique, a firm cannot learn how to cope with it in advance and therefore firms encounter them with little experience (Grewal & Tansuhaj, 2001). With that in mind the authors want through this study to contribute with additional knowledge regarding how SMEs in the hospitality sector in Norrbotten

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future crises. To understand how SMEs can survive in the current crisis figure 1 was developed below, which illustrates how SMEs can respond to an economic crisis by applying marketing innovation activities (changes in the 4 P's in the marketing mix).

Figure 1 - Economic crisis linked to the marketing mix

1.3 Purpose and Research Questions

The purpose of this study is to examine how SMEs in the hospitality industry in Norrbotten have been affected and how they are changing their way of marketing in order to survive in the economic crisis that is derived from the COVID-19 pandemic.

RQ1: How have SMEs in the hospitality industry in Norrbotten been affected by the economic crisis derived from the coronavirus outbreak?

RQ2: How can SMEs in the hospitality industry in Norrbotten adapt a new way of marketing in times of crisis?

1.4 Delimitations

The conducted research in this thesis is delimited to small and medium sized enterprises in Norrbotten, Sweden. The study is also delimited to a specific industry which is the hospitality industry. Due to a limited timeframe for this degree project the approach for data collection will be qualitative and the number of interviews conducted with companies will also be limited.

Economic Crisis Marketing

Innovation Changes 4P’s

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1.5 Outline of Entire Thesis

The main objective with this section is to give a comprehensive outline view of this study. The gradation of this thesis is illustrated in figure 2 below. In the first chapter there is an introduction, which contains a background, problem discussion along with the study’s overall purpose and it will end with this study’s stated research questions. Delimitations of the study are also presented in chapter one. Chapter two will discuss models, research and theories from previous research within the field. Methodology is the third chapter. This chapter will present necessary proceedings and course of actions on how the methodological choices that helped build this thesis. Chapter four will present the empirical data with key citations from the interview with the respondents. Chapter five presents an analysis of the gathered data from the interviews towards theories from this study’s frame of reference, a so-called data analysis. At least but not last, in chapter six, the main findings and conclusions will be presented and discussed.

Figure 2 - Outline of thesis Chapter 1 - Introduction

Chapter 2 - Literature Review

Chapter 3 - Methodology

Chapter 4 - Empirical Data

Chapter 5 - Data Analysis

Chapter 6 - Findings & Conclusions

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2. Literature Review

In this chapter, the study will review previous literature in the area of (1) economic crises and (2) marketing innovation. The reviewed literature on economic crisis will assist the study to highlight the challenges that businesses encounter in dealing with the outcomes of an economic crisis. Further on in the chapter previous studies in the field of how innovation could be used in order to deal with a crisis, within the context of: marketing innovation.

2.1 Economic crisis impact on businesses

Crises can come in various forms (natural disasters, technological disasters and economic crises) and occur at the most surprising time, in a way one ever could imagine (Grewal & Tansuhaj, 2001). Pearson & Clair (1998) defines a crisis as a low probability, ambiguity, high consequence decisions along with time pressure.

An economic crisis can affect companies in many different ways and if it is not managed correctly it will be costly for the organization (Ghandour & Benwell, 2012). Some businesses are forced to reduce the production (i.e. the supply) due to inadequate demand for products and services combined with competition within the market environment. They could also be forced to lay off personnel or lower the wages, and some companies are forced to shut down the business completely (Köksal & Özgul, 2007). The financial suffering can also be in terms of disruption in the supply chains (Ghandour & Benwell, 2012).

A supply disruption leads to decreased production and demand shortage which in turn causes unemployment (Guerrieri, Lorenzoni, Straub & Werning, 2020). Thus, a disruption in supply could damage the organization internally but also externally since the reputation and trust with stakeholders is put to the test, since it affects the brand equity (Ghandour & Benwell, 2012; He

& Ran, 2015). In an article about the macroeconomic effects of COVID-19, Guerrieri et al.

(2020) mentions that supply disruptions could cause supply shocks in an industry. Supply shocks that initially only affect a single industry can spread quickly into other industries during a pandemic. This means that goods become less available, whereupon the price of the products in the specific industry increases, making consumption more high-priced and thus also less attractive (Guerrieri et al. 2020).

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The economic impact derived from the COVID-19 pandemic is really something else for businesses to handle. A valid comparison of the COVID-19 pandemic to previous crises, such as the global finance crisis in 2008 and the SARS outbreak in 2003 simply cannot be made. This time it is different: it is a global pandemic, it is not solely affecting poor income countries, interest rates are down at record levels, and the whole world is going through a destruction of demand and supply (Fernandes, 2020).

2.1.1 SMEs and the economic impact

Empirical results show that SMEs are the ones who suffer the most during financial turbulence and are exposed to a higher risk of facing bankruptcy (Yazdanfar & Öhman, 2018; Vargo &

Seville, 2011; Quintiliani, 2017). Around 99 percent of all Swedish companies are SMEs and SMEs creates jobs for about 70 percent of the whole labour force in Sweden (Yazdanfar, Öhman

& Homayoun 2019). The reason for why SMEs suffers to a larger extent compared to bigger firms is because of their dependence on loaned money and overall limited financial resources (Bourletidis & Triantafyllopoulos, 2014). The fact that SMEs many times have limited financial resources leads to limited flexibility and therefore lack the ability to respond to environmental changes, especially during an economic crisis (Yazdanfar, 2011).

2.1.2 Understanding consumer behaviour in an economic crisis

An economic crisis affects the purchasing behavior of consumers (Mogaji, 2020), in both mentally and financial ways (Köksal & Özgul, 2007). Mentally, the negative impact on businesses is that consumers become more eager to save money in fear of losing their job (Sharma

& Sonwalkar, 2013) and people that lost their jobs are the ones who are most financially vulnerable (Mogaji, 2020). Financially, people reduce consumption due to a changed perception of risk (Sharma & Sonwalkar, 2013; Mogaji, 2020). Most of all, during an economic crisis, the household reduces its consumption which means that consumers prioritize necessary products and switch to cheaper substitutes (Sharma & Sonwalkar, 2013). For a lot of businesses this means that sales starts to drop (Srinivasan & Lilien, 2009). When the price elasticity curve changes the organization needs to adapt to the customers redefined value in order to respond. In those cases, it is common that leaders in charge think that cost rationalization and lowering prices are enough measures to stimulate the organization again (Barwise & Styler, 2002; Piercy et al. 2010).

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2.1.3 Significance of marketing in an economic crisis

However, one thing that should not be compromised in an economic crisis is the marketing activities (Köksal & Özgul, 2007; Srinivasan & Lilien, 2009; Alananzeh et al. 2018).

Organizations that increased the spending on marketing during the economic crisis did not increase the income in the economic downturn. However, the revenues increased quicker once the recovery of the recession started in comparison to firms that solely focused on cost rationalization (Köksal & Özgul, 2007; Srinivasan & Lilien, 2009). Empirical evidence shows that firms who focused heavily or maintained the degree of marketing, the market stake increased thrice faster when the economic downturn was over (Roberts, 2003). However, research shows that it is more important to retain customers compared to chasing new customers. Thus, in an economic crisis it is of great importance to retain the loyal customers, since they are the most profitable and therefore marketing mainly should target the loyal customers (Grundey, 2009).

2.2 Marketing Innovation

Another marketing strategy that has proven to be successful in times of crisis is the adoption of marketing innovation (Naidoo, 2010). Marketing innovation is a tool that assists the developing and sustaining of competitive advantage (Anning-Dorson et al. 2018). Market innovation can be described as the application of a new marketing strategy with changes in product, pricing strategy, packaging style and product placement (Karlsson & Tavassoli, 2016; Hussain et al.

2020). It can also be described as the creation of value by using relevant information and capabilities to implement an idea for a new marketing strategy or improvements in an existing marketing strategy (Varadarajan, 2018). Marketing innovation includes innovations such as distribution innovation, promotion innovation and pricing innovation (Varadarajan, 2018). The objective with marketing innovation is to better meet customer needs, give the company’s product a new position in the market or open up new markets (Karlsson & Tavassoli, 2016;

Medrano & Olarte-Pascual, 2016; Widjojo et al. 2020). Empirical studies have shown that successful marketing innovation helps companies to gain or sustain a competitive edge (Line &

Runyan, 2012; Scaglione et al. 2009). An empirical study by Falk (2013) shows that firms that focus on marketing innovation during a crisis have a higher chance of surviving.

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2.2.1 Marketing Innovation in Times of Crisis

An economic crisis or recession will most definitely create changes in the business activity and strategies for the organization (Gümüş, Geçti, F, & Yılmaz, 2019). Since product innovation tends to be too expensive in the midst of an economic crisis the focus therefore shifts toward market factors instead, such as demand management (Grewal & Tansuhaj, 2001). In an article related to COVID-19 it is highlighted how companies need to figure out how the consumer’s needs have changed (Bartik et al. 2020). People’s habits are changing, and millions of households are capsized and therefore firms constantly need to work with marketing innovation to increase customer satisfaction and to stay competitive (Medrano & Olarte-Pascual, 2016; Medrano et al.

2020). By employing a marketing innovation strategy, it is intended to shift the demand for a firm's products or services from elastic to a more inelastic demand (i.e. less price sensitive demand), by increasing the customer value and thus also the organization’s revenues (Naidoo, 2010; Hussein, et al. 2020).

2.2.2 Marketing Innovation for SMEs in Times of Crisis

Marketing innovation is ideally suited for SMEs who usually have limited resources and if SMEs achieve competitive advantage it increases the likelihood of surviving a crisis (Naidoo, 2010;

Halpern, 2010). An explanation to why marketing innovation is well suited for SMEs is that an economic crisis many times triggers a price war (i.e. a course of intense competition with price reductions). Most of the time companies engaged in a price war take severe damage, especially SMEs. The reason for that is the small margins for SMEs compared to big firms (Grundey, 2009).

However, an adoption of a marketing innovation strategy facilitates the firm's ability to differentiate and to secure a cost leadership. Derived from the differentiation and cost leadership comes competitive advantage, which in turn is a major contributing factor to SMEs firm’s survival in a crisis (Naidoo, 2010).

In addition to that, SMEs have a vital role in every economy as companies of such character are said to be the central driving forces of economic growth, employment and innovation (Kossyva et al. 2015). Furthermore, because of the organizational size, SMEs are considered being more adjustable and flexible than bigger companies when it comes to introducing new products or services in an economic crisis (Kossyva et al. 2015; Naidoo, 2010). That is also the case for companies that are not a part of a group of companies, since those companies do not have to

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2.2.3 Marketing Innovation in Hospitality Industry

In times of crisis empirical results from a previous study proves that new technologies, foremost the rise of the internet have had a great impact on the tourist industry and hotel industry marketing innovations (Campo et al. 2014; Nicolau & Santa-María, 2013). The rise of the internet has given firms access, at a low cost, to an indefinite number of consumers (Consiglio et al. 2018; Campo et al. 2014). Firms web pages and social media activity are key elements for promoting services and products. In addition, the website use as sales channels reduces the use of intermediaries, making it cheaper for the hotel company and easier for the customer to reach information about the company or a product (Hjalager, 2010; Consiglio et al. 2018; Campo et al. 2014) These marketing innovations derived from new technologies has proved to be an important element for firms in the hospitality industry to stay competitive and to increase revenues (Scaglione et al.

2009). Marketing innovation activities positively influences the economic profitability for firms in the hospitality industry (Nieves & Diaz-Meneses, 2016).

Also, empirical results from a study by Campo et al. (2014) proved that hotels' ability to innovate during the financial crisis in 2008 allowed an increase in customer service quality, satisfaction level and greater value offer. These three terms are key elements in order to sustain and gain competitive advantage and financial profits (Medrano et al. 2016; Anning-Dorson et al. 2018).

Due to that, firms that on purpose limited the investments on marketing innovation activities when facing a crisis, should have reviewed their decision and done so instead, implementing marketing innovation activities such as new process bettering’s and new services (Campo et al.

2014). Results from an empirical study reveals that companies in the hospitality industry primarily should focus on marketing innovation in order to survive in times of crisis. The results proved that firms in the industry mainly focus on applying innovative marketing ideas, followed by better pricing along with improvements in promotional activities (Pappas, 2015).

In a paper that investigated how marketers in the hotel business managed the SARS epidemic in Toronto (where around 75 percent of the businesses in the hospitality sector experienced a downturn), the most common strategy way to rely on government assistance (Jayawardena et al., 2008). Among the strategies where the company actually took action the most common tactic was to offer price reductions in order to attract customers. However, a few hotels offered their rooms for other purposes than accommodation, like renting their available rooms as offices instead (Jayawardena et al., 2008). Solutions like the one mentioned can be effective for

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companies in a crisis instead of the common price reductions since price reductions do not increase the profit in the same proportion. In order to stay profitable in the long-term companies instead need to retain the spending on marketing (Köksal & Özgul, 2007). Since marketing innovation suits the spending ability of SMEs and is defined as improvements and necessary changes in the marketing mix. The tools available to create increased customer value are; place promotion, product and price (Naidoo, 2010; Köksal & Özgul, 2007).

2.3 The Marketing Mix

The marketing mix can be described as the set of activities the organization applies to promote its product or brand in the market. Another description could be as the mixture of different marketing decisions that the organization uses to market its products or services. Which could be used to innovate the organization out of the impacts of an economic crisis (Singh, 2012). It is a dynamic and innovative model thus it changes according to the changes in preferences of the consumer, market competition, market situation and government policies (Singh, 2012).

Managers in the organization need to evaluate the traditional marketing mix model when a crisis strikes by reshaping it with tools in the marketing mix for marketing innovation (Naidoo, 2010).

It is essential to create and apply an appropriate marketing mix of the elements in it to gain competitive advantage (Singh, 2012). To get the best profitable outcome from marketing activities, the marketing mix should adapt according to the market condition and how the outside world is changing (Singh, 2012). The four elements of the marketing mix: product, price, place and promotion are presented in figure 3 down below.

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Figure 3 - The Marketing Mix Source: Adapted from Singh (2012)

2.3.1 Product

A product is what is actually exchanged. A product is a package of complex advantages that please the customer. The customer gives money for the product or the service but what the customer actually pays for is the experience the product brings and the level of satisfaction that it has. Hence, the product or service needs to be accurate and suitable in order to match the need of the customers (Salman et al. 2017).

That firms that focus on innovation are more likely to survive is commonly known (Falk, 2013).

However, new product innovation tends to be expensive and therefore it might not be a viable tool for companies in order to survive a crisis, especially not SMEs (Grewal & Tansuhaj, 2001).

Instead it is suggested that innovation in a crisis focuses on the other components of the marketing mix, i.e. price, place and promotion (Hamdani & Wirawan, 2012).

The Marketing Mix

Product Price

Promotion Place

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2.3.2 Price

What the customer must pay to receive the offered product is the price. The price of a product or service relies on numerous factors and therefore the price is continuously changing. Due to that, the price should be dynamic so that it can adapt to changes over periods of time (Singh, 2012).

The prices element in the marketing mix model is ruled by what is being debited for what it takes to perform the service or buying the product. Pricing does not only influence the revenues for the organization, it also influences the buyer perceptions regarding the quality of the product or service. Therefore, pricing is vital to the organization’s daily business operations (Salman et al.

2017).

Hence, an economic crisis obligates companies to adjust the pricing, mostly downwards with price reductions. The objective with price reductions is to increase sales volume in the short term.

It is a course of action that could damage the organization in the long run, primarily by receiving lower revenues from reduced prices, but it could also damage the image of the brand and consumers might not accept returning to the normal price when the crisis fades (Köksal & Özgul, 2007). Ang, Leong and Kotler (2000) proposes two pricing approaches when in an economic crisis: Use the initial price for quality products and services or offer quality products to a reduced price (Ang et al. 2000). Yet, if the organization does not adopt pricing strategies, such as premium pricing or lower pricing and does not adapt to the consumers purchasing behavior during an economic crisis, the organization will probably be deprived of customers and struggle to survive (Raggio & Leone, 2009). However, the selection of price during a crisis should be combined with other marketing operations involving the three other P’s in the marketing mix (Köksal &

Özgul, 2007).

2.3.3 Place

The place element in the marketing mix model is mainly about the distribution channel methods that the organization uses in order to support the facilities to its market in a way that satisfies customer expectations (Salman et al. 2017). It also includes warehouse buildings and mode of transportation since the place element is a process in which products and services are transported from the organization to the customer (Singh, 2012). Mode of transportation (i.e. distribution) has a large impact on the organization’s profitability. Hence, the organization should have a solid supply chain and logistics management when it comes to distribution (Singh, 2012).

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In a study that examined how the hospitality sector dealt with an economic crisis the result was the same as in most other industries, which is that companies put a lot of effort in trying to reduce the costs (Pappas, 2015). In turn that is also in line with how the “place” element of the marketing mix is typically dealt with. Since a suggested solution for how to deal with a crisis is to reallocate resources and focus on improving the effectiveness in the distribution channel in order to reduce costs (Kotler & Armstrong, 2006). The distribution has a vital role in every business model.

However, when a firm has to reallocate its resources it might not be prioritized, when firms instead emphasize other parts of the business that are more directly connected to profitability (Chesbrough, 2010; Kotler & Armstrong, 2006).

2.3.4 Promotion

Promotion involves all the elements that the organization can use to enlighten the customers within the market with information on its product or service offering and includes advertising, public relations, personal selling, direct marketing, publicity, sales promotional efforts and interactive channels (Salman et al. 2017; Singh, 2012). These previously described features are so-called promotion activities whose purpose is to communicate and persuade the selected market to purchase the organization’s product or service (Singh, 2012). The promotion element supports the organization when it comes to presenting the product or service to the customer in an efficient way and encourages the customer to buy the company's products or services (Salman et al. 2017).

The decisions the organization makes regarding promotion tactics during a crisis are vital. By having the same degree of advertising or increasing the degree of advertising increases sales, market share and revenue after and during an economic downturn (Köksal & Özgul, 2007). Also, the customer buys more rationally with diminishing spending power during a crisis. Thus, advertising should highlight the importance of safety, durability and reliability, rather than a representable portrait of the brand (Köksal & Özgul, 2007).

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2.4 Frame of reference

In the frame of reference, the most important theories from the literature review (collected from previous research) will be summarized, in order to guide the collection of data. Since the collected data will be compared to previous research in the field, the frame of reference also works as a foundation to guide the analysis of the collected data, and in the end also guide the fulfillment of the purpose of this thesis:

“to examine how SMEs in the hospitality industry in Norrbotten have been affected and how they are changing their way of marketing in order to survive in the economic crisis that is

derived from the COVID-19 pandemic”

Hence, the reason why this frame of reference highlights previous research within the field of economic crisis, marketing innovation and the marketing mix. The subjects that are emphasized in the frame of reference will ultimately guide the data collection and data analysis into answering the research questions of this thesis, which reads:

RQ1: How have SMEs in Norrbotten been affected by the economic crisis derived from the coronavirus outbreak?

and

RQ2: How can SMEs in Norrbotten adapt a new way of marketing in times of crisis?

The purpose of the first research question is to examine how SMEs in the hospitality sector have been affected by the COVID-19 pandemic and the following economic crisis. Since every crisis is as Grewal and Tansuhaj (2001) mentioned; more or less unique. The purpose of this research question is to examine how this crisis differs or what similarities it has in comparison to what characterizes a crisis according to previous literature. According to Köksal and Özgul (2007) a common consequence of an economic crisis is a reduction in demand, which in turn is a consequence of customers' changed behavior during a crisis. The changed customer behavior is according to Sharma and Sonwalkar (2013) a response to the fear of losing the job and therefore customers have a tendency of prioritizing saving instead of spending money. Another reason for a changed behavior during a crisis is found among those who actually lost their jobs and therefore changed their way of consuming (Mogaji, 2020).

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However, a reduced demand is not the only thing that causes financial suffering for firms in a crisis, it could also be brought by disruptions in the supply chain (Ghandour & Benwell, 2012).

Both supply disruptions and a reduced demand leads to decreased production and demand shortage which in turn causes unemployment or even forces companies to shut down completely (Guerrieri et al., 2020; Köksal & Özgul, 2007). According to studies made by Yazdanfar and Öhman (2018), Vargo and Seville (2011) and Quintiliani (2017) SMEs are among those who suffer the most during a crisis. Bourletidis and Triantafyllopoulos (2014) mentions SMEs in general, high dependence on loaned money and overall limited financial resources as the main contributors to their vulnerability.

In order to survive a crisis Naidoo (2010) and Falk (2013) suggests that companies should use marketing innovation as a marketing strategy. Hence the reason why the second research questions main purpose is to see if SMEs in the hospitality sector in Norrbotten have adapted their marketing according to what is suggested in previous research, i.e. marketing innovation.

Marketing innovation can be described as the improvements that can be made in the marketing mix: product, price, place, promotion (Medrano & Olarte-Pascual; Karlsson & Tavassoli, 2016).

Empirical evidence from a research by Naidoo (2010) proved that marketing innovation is a suitable solution for cash-strapped firms (mainly SMEs) when facing a crisis. In addition to Naidoo’s (2010) research, Line and Runyan (2012) and Scaglione et al. (2009) research suggested that successful marketing innovation helps firms to keep the competitiveness.

To maintain competitiveness in times of crisis, Hamadan and Wirawan (2012) suggested that innovation activities mainly should focus on the dimensions, place, price and promotion, since product innovation is relatively expensive (Grewal & Tansuhaj, 2001). For instance, Köksal and Özgul (2007) mentioned that the most common pricing strategy when in an economic crisis is to lower the prices. However, Köksal and Özgul (2007) also underline the danger with lowering the prices too much, as it can damage the brand image. Hence, the pricing strategy should be dynamic, which Singh (2012) suggested. Kotler and Armstrong (2006) suggested cost effective distribution channels, which Salman et al. (2017) explained as fundamental since the company’s facility usually does not change location. One more suggestion is mentioned by Srinivasan &

Lilien (2009) regarding promotion is the importance of marketing during an economic crisis.

Alananzeh et al. (2018) supports Srinivasan & Lilien (2009) statement, which Grundey (2009) meant is aimed at the most frequent and loyal customers, not new customer segments. Based on

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the knowledge and theories from previous studies mentioned above, a frame of reference was developed, which can be seen in table 1 below.

Table 1: Frame of reference for research questions

Subject Factors References

Economic crisis Reduced production Supply disruptions

Layoff and termination of personnel

Financial impact on SMEs

Consumer behavior in an economic crisis

(Köksal & Özgül, 2007;

Ghandour & Benwell, 2012) (Guerrieri, Lorenzoni, Straub

& Werning, 2020)

(Köksal & Özgül, 2007;

Guerrieri, Lorenzoni, Straub &

Werning, 2020)

(Yazdanfar & Öhman, 2018;

Vargo & Seville, 2011;

Quintiliani, 2017; Bourletidis

& Triantafyllopoulos, 2014) (Köksal & Özgül, 2007;

Sharma & Sonwalkar, 2013;

Mogaji 2020) Marketing

innovation

Improvements in the marketing mix

Product

Price Place

Promotion

(Naidoo, 2010; Falk, 2013;

Karlsson & Tavassoli, 2016;

Medrano & Olarte-Pascual, 2016; Widjojo et al. 2020;

Line & Runyan, 2012;

Scaglione et al. 2009) (Grewal & Tansuhaj, 2001;

Hamadan & Wirawan 2012;

Kossyva et al. 2015; Naidoo, 2010)

(Singh, 2012; Köksal &

Özgul, 2007; Naidoo, 2010) (Grundey, 2009; Naidoo, 2010; Kotler & Armstrong, 2006; Singh, 2012; Salman et al. 2017)

(Köksal & Özgul, 2007;

Srinivasan & Lilien, 2009;

Alananzeh et al. 2018;

Grundey, 2009)

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3. Methodology

In this chapter, research purpose, research strategy, research approach and methods used for this research study are explained and discussed. All these method approaches down below are chosen with the aim of receiving a deeper insight into the subject and to allow the reply of the stated research questions.

3.1 Research Purpose

The research purpose depends on how the research questions are formulated which can be formulated in either in a descriptive, explanatory or exploratory manner (David & Sutton, 2016).

A descriptive purpose is applied in case studies where the research problem is described in its real-life context (Yin, 2014). A descriptive research purpose's main objective is to emphasize a situation where, what, when and who. This is in the absence of an earlier or sufficient explanation of what is going on (David & Sutton, 2016). An explanatory research purpose is about measuring the examined situation but also to investigate how different elements are related to one another and especially if one element impacts the outcome of another element (David & Sutton, 2016).

An exploratory research purpose is used in case studies when the situation that is being evaluated has no perspicuous outcome (Yin, 2014).

This study focused on an exploratory research purpose because the objective and intent of this study was to explore how SMEs in the hospitality industry in northern Sweden changed their marketing activities in order to survive in the economic crisis that is derived from COVID-19.

Also, exploratory research is associated as an important element in qualitative research (David

& Sutton, 2016). Moreover, in an exploratory study the purpose is to explain what is going on in a field of research where no previous or little exploration has been conducted (David & Sutton, 2016). Since a crisis is surrounded by uncertainty and the fact that every crisis is more or less unique - an exploratory case study was best suited for this thesis.

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3.2 Research Approach

There are two research approaches that can be used when conducting a research study: inductive or deductive approach (David & Sutton, 2016). A deductive approach is used when a research study is built on previous research theories and literature (Saunders et al. 2012). An inductive approach is used when a research study is built upon observations (i.e. experiences) that have been observed from the reality (Saunders et al. 2012).

3.2.1 Deductive Approach

This study used a deductive approach. A deductive approach is suitable when a study is based on previous models, theories and literature (Saunders et al. 2012). Previous literature (theories and models) within the field of study was discussed and analyzed in order to compose the research questions of the study. The research questions were later on tested against previously collected literature. (Saunders et al. 2012). From the collected models and theories, the frame of reference was developed that was used when the empirical data was analyzed.

3.2.2 Qualitative or Quantitative Data Collection

During this study, the researchers made a decision if the gathering of data would be performed in a qualitative or quantitative way. For the purpose and configuration of this study it was decided that a qualitative data collection was most appropriate. In the qualitative research process, emphasis is placed on the collection of data of the non-numeric nature, that is to say close descriptions of events, in-depth interviews, documents and other artifacts (David & Sutton, 2016).

The method that was applied in this research was qualitative interviews, so called in-depth interviews. The outcome of qualitative interviews is a deeper understanding of certain factors (Saunders et al. 2012). Since the purpose of this study was to get a better understanding of how SMEs in the hospitality sector can survive an economic crisis, the qualitative approach was well suited.

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3.3 Research Strategy

The research strategy is the plan for how the study is going to achieve its objectives (David &

Sutton, 2016). This study used a case study because it allowed the researchers to investigate the selected organizations when going through a series of complex happenings (Baxter & Jack, 2008). Case study as a research strategy was the most appropriate strategy that could be used since it allowed the researchers to investigate the complex measures the interviewed organizations had to implement, in order to cope with the economic crisis derived from the COVID-19 pandemic.

3.3.1 Case Study

When a study contains of more than one single case, a multiple case study is needed (Yin, 2014) Since this study investigated and selected three SMEs in the hospitality industry in Norrbotten, a multiple case study was used. A single case study is used to observe only one case (Yin, 2014) and was therefore not suitable for this study due to the selected sample of this study. Since this study implemented a multiple case study, comparisons between similarities and differences could be made in between the three cases (Baxter & Jack, 2008). Another advantage of the selected multiple case study is that it investigates two or more cases which gives more convincing and reliable empirical data (Eisenhardt & Graebner, 2007).

It is also important to decide if the case study is holistic or if it contains embedded units. If a case study examines numerous units (e.g. subgroups in a firm) of analysis it is embedded (Yin, 2014).

On the contrary, when a case study looks at only one unit of analysis, the case study is holistic (Yin, 2014). This study looked at one unit of analysis, since the study focused on one individual within several cases and that individual's opinions on how the case is believed to be (Yin, 2014).

Hence the reason this study was a holistic multiple case study.

3.4 Data Collection

When the research strategy had been established, the next part of the process was to gather empirical data. There exist two kinds of empirical data: primary or secondary. Primary data is data used in research that is originally obtained from the researchers via surveys, interviews or observations (David & Sutton, 2016). This study collected primary data collected from interviews with SMEs in Norrbotten with the purpose to answer the stated research questions, to receive an in-depth understanding about the subject of interest and to better comprehend existing

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theory and models. Secondary data is research that has previously been collected before for other purposes and is data that can be accessed by receptors (David & Sutton, 2016). This research applied secondary data from statistics firms and several authorities in Sweden.

3.4.1 Interviews

Interviewing can be described as the process of asking people questions. However, interviewing is just as much about listening cautiously to the answers that are given. There exist several interview techniques. Either an interview is structured or unstructured. An interview can also be semi structured, which corresponds to a mix of a structured and unstructured interviews method.

A structured interview tries to highlight the significance of a respondent’s exclusive response by applying surveys with prearranged questions. A structured interview is normally applied and seen in quantitative research. When it comes to qualitative research, an unstructured or semi structured interviews method is more appropriate. Thus, the qualitative interview is a more unstructured and unstandardized interview technique. In that way, the interviewer lets the respondent state their version of what is being asked as more flexible answers are desired (David & Sutton, 2016).

The three mentioned interview methods are described in table 2 below.

Table 2: Interview types

Semi Structured Unstructured Structured

● Used in qualitative research

● Central questions made in advance

● Gives room for additional questions

● Non-standardized

● Open answers are sought

● Questions not predetermined

● Used in qualitative research

● More open and flexible answers from interviews

● Used in quantitative research

● Questionnaires with advanced formulated questions

● Standardized questions

Source: Adapted from David and Sutton (2016, pp. 114-115)

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This study used a semi-structured interview approach to the respondents. One of the central strengths that the semi structured interview has is the interview technique’s flexibility. The interview technique allowed this study to ask certain questions in a different way for every interview, which gave a deeper insight into the thesis investigated area. The method also gave this study the opportunity to ask to follow up questions about interesting subjects that arose when the interview was conducted. Additional knowledge that the study might not have anticipated in the first place and that is for sure a key strength of this qualitative interview method (Saunders et al. 2012).

Furthermore, the study accomplished the interviews with the respondents from the small and medium sized enterprises Nordic Lapland and Varvet Luleå face to face (i.e. personal meetings in real life context). Meeting in a personal meeting and being engaged personally with the respondents leads to a better response rate rather than performing quantitative research in sending out a questionnaire. Also, participants are less likely to fully commit their time in answering a questionnaire (David & Sutton, 2016). The interview with the respondent from Treehotel was conducted through a telephone interview. Due to prevailing circumstances (coronavirus), the respondent expressed the desire to conduct the interview by telephone. Since it is important that the respondent feels safe and secure during an interview in order to get reliable answers (David

& Sutton, 2016), the researchers accepted the request.

As mentioned earlier in this chapter, an interview means more than just asking questions since it is just as much about listening cautiously to the response that is given. For that reason, the interviews were recorded and transcribed which contributed to a solid collection of data to analyze (David & Sutton, 2016). Something that will be further discussed in section 3.6, data analysis.

3.5 Sample Selection

To gather samples, researchers usually use one of these two sample methods: probability sampling or non-probability sampling. Probability sampling is built on the principle that everyone in the population has the same opportunity to participate, while non-probability sampling is characterized by the opposite, there is no certainty of an individual to be a part of the selected sample (David & Sutton, 2016). However, probability sampling is more used when performing quantitative research. A non-probability sampling can be used when time or cost

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restrictions make it impractical to investigate a widely dispersed population (David & Sutton, 2016). Since this study applied a qualitative research and was time restricted a non-probability sampling method was applied.

Within non-probability sampling there exist more underlying sampling methods to choose from.

One of those methods is purposive sampling. In a purposive sampling the sampling selection is made in line with the researcher's own ability and perception of which individuals might be appropriate for the research. It places demand on the researcher’s since they are using their own diligently in order to select the most appropriate sample (David & Sutton, 2016). In this study, the researchers chose three individuals in Norrbotten, with positions such as CEO, part-owner and media and press responsible. The researchers assessed that the selected respondents had specific knowledge that could answer this study's research questions. The selection was based on the researchers' perception of who is the most suitable research person to choose (David &

Sutton, 2016). Therefore, this study used a purposive sampling.

3.5.1 Selected Companies

The selected organizations were Nordic Lapland Resort, Varvet Luleå and Treehotel. Nordic Lapland Resort is a tourism company located in Axelsvik, outside Kalix. Varvet Luleå is a restaurant located in Luleå. Treehotel is a hotel company located in Harads, outside Boden. The small and medium sized enterprises were selected since all represented the hospitality industry in Norrbotten. The hospitality industry is the most affected business industry in Norrbotten (due to the coronavirus) which was another reason why companies in that industry were selected. The firms offered a clear view on how small and medium sized enterprises in the hospitality industry were affected financially by the economic crisis derived from the coronavirus. The selected companies also offered a clear view of how SMEs in the hospitality industry in Norrbotten adapted their way of marketing as a response to the economic crisis coming out of the coronavirus.

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3.5.2 Interviewed respondents

The study set requirements for the choice of respondent for the interviews. To fulfill these requirements the candidate had to have a position related to marketing activities in a small and medium sized enterprise in the hospitality industry in Norrbotten. This was a necessary requirement in order to gather empirical data that was able to answer the study's research questions.

Based on the requirements above, the study interviewed three employees from small and medium sized enterprises in the hospitality industry in Norrbotten. Table 3 down below summarizes key facts of the interviewed respondents.

Table 3: Interviewed respondents Company Position Experience Interview

Length

Interview Date Interview type

Nordic Lapland

CEO 4 ½ years 40 min 2020-05-11 Face to face interview Varvet

Luleå

Part- owner

1 year 40 min 2020-05-15 Face to face interview TreeHotel Media

and press officer

10 years 45 min 2020-05-18 Telephone interview

3.6 Data Analysis

In order to analyze the empirical data, collected via the interviews, the first step this study took was to transcribe the data. Transcribing the data was the process when the recorded sound files from the interviews were turned into writing. Since qualitative data is not quantified or numerical it had to be coded in order to be understandable and useful (Saunders et al. 2012). Codes can be words, themes or expressions, and by coding the transcribed data it facilitates the reduction of the data (David & Sutton, 2016; Saunders et al. 2012).

The data reduction is the first out of three suggested steps in the process of analyzing data, a three-step guide that this study applied. The reduction of data constituted the work of

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concentrating and simplifying the data, which the study did in order to highlight the most important parts of the interviews. The second step of the data analyzing process in this study was the data display. In that step, this study had already reduced the data in an organized way with the purpose of creating a clear outline for the empirical data. The last step consists of the drawing and verifying of the data, which in other words means that this study made conclusions that were translated into something more substantial (Saunders et al. 2012).

To get to the stage where a conclusion could be drawn, this study applied pattern matching as a method to proceed with the data analysis. Understanding the basics of pattern matching significantly helps conducting qualitative research studies (Sinkovics, 2018). Furthermore, when analyzing qualitative data with a deductive research approach as this study used, pattern matching is the most suitable data analysis method (Yin, 2014). The pattern matching involved the comparison of empirical data and the theoretical framework of this study (Sinkovics, 2018). It made it possible for this study to compare the chosen theories with the collected data, with the purpose to receive an in-depth understanding of the subject.

3.7 Reliability and Validity

To provide quality and trustworthiness to the study, Riege (2003) names two key terms as essential: reliability and validity. Reliability is defined as the degree to which the test is a consistent measure over time and validity is referred to as the appropriateness of the data, processes and tools (Leung, 2015). Having a high level of reliability and validity increases the sincerity of the data (Leung, 2015). To provide a high-quality level of the data Riege (2003) names four design tests to perform in order to ensure a good level of quality to the research:

external validity, internal validity, construct validity and reliability. Table 4 below illustrates these tests and in which phase of a study the four tests were applied in this study.

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Table 4: Types of Validity Tests

Types

Case Study Tactic Research Phase

Reliability ● Develop case study information base

● Usage of case study protocol

● Data Collection

Construct Validity

● Usage of multiple sources as evidence

● Key respondents’

reviews draft of case study

● Data Collection

● Composition

Internal Validity ● Used in explanatory study

● Addresses explanation of rivals

● Applies explanation building

● Data Collection

External Validity ● Application of theories in Single Case Studies

● Usage of replication logic in Multiple Case Studies

● Research Strategy

Source: Adapted from Riege (2003)

Based on the information in table 4 above, four tests have been applied in this study to ensure that the reliability and validity is high, in order to avoid methodological issues regarding the conducted case study. This will be described in detail in the upcoming section of the study where reliability is first to be discussed.

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3.7.1 Reliability

Reliability can be described as the degree to which the research study is consistent over time, if repeated several times (Riege, 2003). In other words, if the study will give the same result at another time or conducted by another researcher (Leung, 2015).

As mentioned earlier, the study used qualitative interviews, i.e. semi-structured interviews. It is difficult to repeat the semi-structured interview and get the same replies and it is difficult to repeat the social interaction between the interviewers and the respondents, which could have impacted the credibility of the study (David & Sutton, 2016). Something that increased the credibility of the study was the selection of respondents and organizations (i.e. the sample selection). The interviewed persons held managerial positions at the company and some of the interviewed persons worked as marketers. The interviewed persons were therefore considered to have good expertise in their field of work, therefore the reliability of the result increased.

Some of the respondents wanted access to the questions before the interview took place, as this was a requirement to join the interview. According to Bryman and Bell (2018), there is a risk that respondents only answered the questions that were on the interview sheet that was omitted and that could have decreased the room for more open answers from the respondents. In an attempt to address Bryman & Bell's criticism of the chosen approach, the researchers have been extra careful during the interview to ask follow-up questions that take more spontaneous and open answers.

The study administered two of the interviews in a quiet environment at a lobby in a central hotel in Kalix and Luleå, all in order to control the interview conditions so that the study received the most reliable answers possible. The fact that the study chose a quieter place to conduct the interviews was because such a place brings a harmonious feeling and security to the respondent.

The quiet location also opened up the possibility of follow-up questions and discussion. Due to the current circumstances the respondent from Treehotel had a different perception of what was a safe environment for the interview. Hence the reason why the interview with the respondent was conducted as a telephone interview. The researchers accepted the request and believe that it was a sound decision in order to get reliable answers and data.

Marketing Innovation for SMEs during COVID-19 Pandemic: A case study of the hospitality industry in Norrbotten