There is concern from CEOs and business owners, particularly those who have been forced into full shut down, about whether their business can resume in a similar capacity to what it was pre-pandemic. We’re all wondering if this will change the world forever. It seems difficult to imagine a world where you’d be allowed to get close enough to another human for them to spill beer on your new shoes in the pub. Difficult to imagine swearing in unison at the ref with 20,000 people at the footy.
But is the fear that these things are gone forever reasonable? What can we learn from other pandemics, and what are we seeing around the world as countries lift restrictions?
When New Zealand lifted its lockdown laws, locals queued from midnight at the McDonalds drive-thru to get some nuggets and a dubious shake. They were literally lining up out into the street to get some normality back into their life.
There is also evidence that retail is rapidly coming back to life as restrictions are lifted. In SouthKorea the term “bobok sobi” - revenge shopping - has trended on the nation’s social media as people rush to make purchases delayed by social-distancing rules.
The most startling piece of evidence telling us that people are super keen to get back to normal is the fact that cruise ship bookings are up 40% for 2021.
Cruise. Ship. Bookings. Are. Up.
It seems normal is a very hard habit to break.
Anecdotes aside, what does the data say about macro-economic changes?
Analysis from the HBR indicated the path to recovery is likely V-shaped, as historically, the recovery from similar viral outbreaks has been rapid. Their advice: “a V-shaped recovery is the plausible scenario conceptually and empirically, but don’t let that insight make you complacent”.
While it’s unreasonable to fear ongoing and catastrophic economic consequences from COVID-19, it is also irresponsible for us to suggest everything will just go back to normal.
Two changes the HBR point to from previous pandemics seem to make sense from what we’re seeing locally.
Firstly, the microeconomic legacy: Crisis can spur the adoption of new technologies and business models. The SARS outbreak of 2003 is often credited with the adoption of online shopping among Chinese consumers.For better or worse Amazon has grown to more than 935,000 employees worldwide, including 95,000 new hires in April. It has been positive to see a lot of local businesses rapidly adopting digital transformation technologies that have been too easy to deprioritise in the past. Many are reporting nothing but positives from the transition.
Secondly, the macroeconomic legacy: COVID-19 appears to be hastening the progress to more decentralised global value chains. Once people have the option to buy from anywhere but Amazon we anticipate a shift towards buying local.
It goes without saying that this pandemic has created a lot of hardship for people. It has blindsided all of us and brought into sharp focus how fragile our lives and businesses can be. But it has also revealed how resourceful we can be. Locally we’re seeing a new wave of innovation and invention from individuals and business to ensure they can remain relevant and provide an opportunity for people to be able to connect with their former life on some level while being deprived of many things that can’t be replaced.
Throw downs in the loo paper aisle notwithstanding, we’re seeing the strengthening of community, of people queuing at their local takeaway to support business owners in tough times (and to avoid another home cooked meal). And this again points to people finding comfort in the few things they can do to connect to the life they love.
If predictions around enhanced support for buying local and supporting Australian business is realised, now is the time for business to prepare for a future that may be look a little different, but will still be bright with new opportunity.