Coronavirus pushes traditional businesses into the digital age
A slew of old-line industries that once hesitated to embrace digital technologies are now being forced to do so for the sake of survival.
Why it matters: Once consumers get used to accessing services digitally — from older restaurants finally embracing online ordering, or newspapers finally going all-digital — these industries may find it hard to go back to traditional operations.
Media and entertainment: Venerable mediums like television, newspapers and movies are all quickly moving their content over to digital formats and online delivery as they struggle to adapt.
- Newspapers are being forced to shut down print editions and ramp up digital operations. “We will look back on these events as a moment at which the newspaper industry’s transition from print to digital accelerated meaningfully," says Jim Friedlich, executive director of The Lenfest Institute for Journalism, a nonprofit that supports local news and is the owner of The Philadelphia Inquirer.
- Television interviews are overwhelmingly being conducted via Skype or other digital channels. There's been a major uptick in internet video and streaming consumption, per Nielsen. More than a quarter of Americans (26%) are using video streaming services, like Netflix, for the first time, per the Consumer Technology Association.
- Some movie studios, like Universal Pictures, have said that they will for the first time roll out movies to digital audiences at the same time that they make them available in theaters due to the crisis. Although analysts don't think the box office will ever die, this could put pressure on the traditional 90-day exclusive movie window that theaters used to enjoy over streamers.
Retail: Brick-and-mortar shops that never sold goods online are shifting to that mode at a moment when stores nationwide have shut their doors and customers aren't leaving their homes.
- Sellers who had offered a limited selection of their wares online are now shifting to full-catalog service.
- Powell's Books, an iconic Portland independent bookstore, was able to rehire 100 laid-off store employees after a surge of online orders from devoted customers.
- By contrast, offline-only retailers, including big names like Marshall's and TJ Maxx, are basically out of business until in-person shopping returns.
Food and beverage: Restaurants that chose not to adopt online ordering or delivery services are suddenly finding that to be their lifeline now that many parts of the country have banned on-location dining.
- Topo Gigio, a small mom and pop Italian restaurant in Chicago, is using delivery services for the first time in its 30-year history. It sees delivery and takeout as a better option than shutting down entirely, its owners tell CBS Chicago.
- Uber Eats, the food delivery service from Uber, announced two weeks ago that it would waive all delivery fees for local restaurants.
Workouts and fitness: Everything from ballet lessons and karate classes to physical therapy sessions and yoga instruction has gone virtual.
- In Houston alone, more than a dozen fitness and yoga operations have taken their services online.
- Some people like to work out with other people for social motivation. Those people may still prefer to go to group fitness classes, but may choose ones that are smaller or in spaces where they can maintain more distance from others, Carl Bialik, data science editor at Yelp, said.
- "But for business owners that get really comfortable with that, they will probably continue to see that as a much bigger channel than they had before," he said.
The bottom line: Going virtual may open up new markets and new channels for engaging with consumers. But consumers will also likely rush to take part in out-of-home experiences once the pandemic eases and they can leave home again.