Recessions have historically brought about new business opportunities for those thinking outside the box and looking for what the world will need during these times of change. During the 2008 recession, startups like Uber and Airbnb identified and capitalized on how consumer needs were expected to change as a result of the banking crisis and housing market crash. The recession we are currently experiencing is no different; we know that savvy and agile businesses are evolving in response to our new reality. Entrepreneurs are identifying new opportunities and unmet consumer needs. All the while, many companies, large and small, across a vast number of industries are struggling to stay afloat with low demand, an unstable supply chain, and great uncertainty around stabilization. While the economy as a whole suffers, here are 5 industries benefiting and capitalizing on societal changes during the COVID-19 era.
In April, Home Depot and Lowe's weekly store visits saw a 31.3% and 71.8% increase respectively, despite the dramatic decrease in overall consumer retail spending. People are taking advantage of unlimited free time at home to complete some easy DIY home projects they never got around to before the pandemic. Be it replacing a door, putting on a new coat of paint, or starting that home garden you always dreamed of, it has never been more feasible and exciting. Similarly, popular online furniture retailers, such as Wayfair and Overstock, have also seen increases in sales compared to the same period last year as consumers spend more time upgrading their homes.
Telecommunications and Online Working Resources
As businesses shift to working from home, the demand for different remote working resources has skyrocketed. Zoom has been the most popular video conference platform making up for the inability to conduct in-person meetings. By the end of April, its revenue had increased by 169%, as it’s being used to host online university classes, business meetings, and different virtual social gatherings. Slack, a business communication platform, saw an 80% increase in new paid customers between the beginning of February and the end of March. As businesses begin reopening slowly, it will be interesting to see how the usage of these platforms shifts and if they will continue growing this rapidly.
Video Streaming Services
With millions of people stuck at home, watching movies or binging new tv series has become an increasingly popular pastime. It's been a saving grace for those trying to stay entertained and distracted while in quarantine. Netflix has seen increases both in its consumer base and in the amount of time each user spends streaming their services. They’ve also capitalized on this opportunity of heightened consumer engagement by releasing new Netflix Originals that have developed a cult following such as Tiger King, Outer Banks, and Money Heist. Netflix had one of its biggest quarters this year with a record-setting 16 million new paid subscribers and an increasing stock value.
Food Delivery Services
Since most restaurants have been prohibiting customers from dining in, providing take-out options has enabled many of them to stay afloat. With take-out being the only way to get a bite from your favorite Italian place or burger joint, food delivery services have been an easy way to access these meals without having to leave your house. Companies like Postmates, Grubhub, Uber Eats, and Doordash have seen increases in the number of orders, the quantity of food ordered per purchase, and the number of delivery drivers as people look for new sources of income during this recession. Additionally, as a result of the risks associated with contamination while food shopping, grocery delivery services like Instacart and PeaPod have also spiked in demand.
At-Home Fitness Equipment
With gyms shutting down to prevent the spread of COVID-19, fitness lovers have been investing more in at-home workout subscriptions and equipment. During the Coronavirus lockdown, Business Wire reported a growth in fitness equipment sales by 170%. The increased demand for treadmills, bikes, and rowers has retailers scrambling to keep up with production needs and consumers waiting weeks longer than typical delivery times. Equipment like weights and barbells have been sold out for weeks on almost every online retailer, creating a second-hand market with prices well above retail; people are desperate to get their hands on any type of gym equipment. Additionally, at-home exercise apps, such as Peloton and Nike Training Club, that provide fitness fanatics with expert-guided workouts in the comfort of their own homes have boomed in subscriptions.
The change in lifestyle brought on by the COVID-19 pandemic has produced new consumer habits that can be capitalized on. While many companies and industries will struggle to respond and survive, we are already seeing a cross-section of firms growing, innovating, and providing new experiences for their consumers. With that, next year’s Fortune 500 will most likely see a dramatic change in the roster with many old familiar names gone in exchange for newcomers yet to be discovered. As the famous author and businessman Bo Bennett once said, “As sure as the spring will follow the winter, prosperity and economic growth will follow recession.”