How Will COVID-19 Impact Each Industry? 9 Experts Share Their Views

After months of confinement, China is slowly overcoming the outbreak of COVID-19. The epicenter of the pandemic is shifting towards the West at an unprecedented pace. As of early-May, Europe is suffering the worst consequences of the virus, that has also spread to Africa and the American continent. 

The world is going through a never-before-seen situation. However, with governments taking strict social distancing measures, the circumstances can only get better. European countries deeply affected by the virus (such as Italy or Spain) are already “flattening the curve”, and the number of new confirmed cases decreases every day.

The fact that this pandemic will have consequences is a no-brainer. All industries are being affected, but businesses such as those in the travel & hospitality industry, or traditional retailers, are undergoing hard times indeed. How does the global pandemic caused by COVID-19 affect each industry?

We have interviewed experts from different verticals within Plug and Play, to give you a glimpse of how COVID-19 is impacting each industry, and how businesses will adapt once the pandemic is under control. 

Supply Chain

world after covid 19 impact supply chain

What will happen to the supply chains globally? We have asked Frederik Bohn, Director, European Corporate Partnerships at Plug and Play’s Supply chain vertical. 

  • Supply chains will become more localized: “The pandemic has clearly shown us that if China has a cough, the world economy is in intensive care… Literally. That is why more production will be done locally to ensure that in tough times, supply chains can still somewhat function independently.”
  • Just in Sequence or Just in Time will become less heavily deployed: “If the supply chains face major disruptions (i.e., for longer than a few days), production grinds to a halt because a couple of parts are missing. This means greater local stockpiles to account for an extended production buffer during times of crises, or massive investment in 3D-printing to locally produce certain parts at a high degree of customization.”
  • Rail and road will become even more integral: “Ocean and air freight are more susceptible to international disruptions, and supply chains will move from global to local, so rail and road are the obvious answers.”
  • Governments will be pushed to implement new regulations: “On urban delivery, truck platooning, customs clearance, automated driving, smart infrastructure, etc. These are needed to help rail and road deal with the new demand and ensure that the current infrastructure doesn’t become completely overwhelmed.”
  • The pace of automation will pick up: Because robots can't contract COVID-19.

Health

world after covid 19 impact health

The delivery of healthcare will change in a post-coronavirus world. There are two categories to focus on: what happens inside the hospital and what happens outside of it. Zachary Poll is Head of Healthcare Partnerships at Plug and Play Health, and this is his prediction:

Inside the hospitals

“Hospitals are seeing record amounts of patient overflow, infectious disease risk, and provider burnout. Despite what many believe, the increased amount of patients is decreasing profitability.” When asked about the most-likely evolutions for how hospitals will change because of COVID-19, this is what he responded:

  • Increased investment in infectious diseases: “Infectious disease risk was already a significant issue for hospitals, and now it is being exacerbated by COVID-19. Look specifically for software that incentivizes best practices for providers, software that visually shows possible pathogens through video, and self-cleaning textiles.”
  • Increased utilization of capacity planning: “Hospitals will find solutions to take existing resources and utilize them more efficiently and faster. Software that finds where unused resources can be found (i.e., face masks) and automated ordering, formal processes for overflow planning, and partnerships with rapid product development companies.”

Outside the Hospitals

“This will be the biggest area of growth because of COVID-19,” said Poll. “Every day, patients and pre-patients are being more exposed than ever before to the resources and value available to getting treated at their own home. They are also getting accustomed to it. Here are the most likely evolutions Plug and Play is predicting for how healthcare will change in the home because of COVID-19:

  • Overall increased utilization: “This seems obvious but it needs to be stated. This trend has been significantly increasing in the last two years, but the big hurdle was getting people to change their habits that when you are sick you go somewhere to get treated. The industry most likely to grow is at-home healthcare.”
  • At-home diagnostics: “People will be utilizing resources within their homes to check for symptoms. This can take many forms such as answering questions online, at-home diagnostic tests that can be done through either cameras or sensors on our existing devices or specific diagnostic devices.”
  • Chronic Care Management: “There will be a host of tools to manage chronic conditions. Digital therapeutics, apps that can tell if medication was taken correctly, diagnostics that are tracking important vitals, and other tools.”

Zachary Poll’s key takeaway is that “none of these areas are new, these have all been growing categories already, and COVID-19 is drastically increasing the value and importance of them. Both from a perspective of increasing patient outcomes, but also profitability for the healthcare system.”

Cybersecurity

world after covid 19 impact cybersecurity

“Cyberattacks related to coronavirus have become so prevalent that they have sparked unprecedented cooperation within the global cybersecurity community,” said Rohit Gupta, Ventures Associate at Plug and Play Cybersecurity. “This has manifested in the formation of an international group of nearly 400 volunteers with cybersecurity expertise called the COVID-19 Cyber Threat Intelligence League. They combat hacks against medical facilities and other frontline responders.” (attacks such as the one that targeted the U.S. Department of Health and Human Services to cause further coronavirus panic through disinformation campaigns). What else is shaking the online security landscape?

  • COVID-19-themed scams: “Threat actors are launching COVID-19-themed phishing emails, which claim to deliver official information on the virus, to lure individuals to click malicious links that download Remote Administration Tools (RATs) on their devices. Some reports estimate thousands of new phishing and scam websites cropping up every day. 
  • Fake streaming sites: “Malicious actors are also aware that many users across the globe are quarantined and spending more time looking for entertainment online, which is why they’ve developed fake streaming sites, or sites offering entertainment promotions to appeal to users. Researchers at Trend Micro spotted the domain hxxps://promo-covid19-neftlix[.]ml, which is actually a phishing site that steals Netflix account credentials. 
  • Unprotected employees: “Due to the COVID-19 crisis, many organizations are requiring and promoting employees to work-from-home to maintain business operations. Unfortunately, threat actors have taken notice and are seizing the opportunity by launching phishing, malware and business email compromise campaigns at individuals no longer protected within the traditional enterprise network perimeter. As personal computers lack enterprise-grade email security and advanced endpoint protection, they are significantly less secure and more vulnerable to malware, exploits, macros and other malicious executables.” 

“Moving forward, it’s likely that threat actors continue targeting individuals working outside of the office given the likelihood of success – this may prompt small and large businesses alike to invest more heavily in endpoint security, malware detection & prevention, and anti-phishing solutions. Moreover, many businesses are coming to terms with the fact that operating in a distributed manner is not the end of the world, which creates a further need for solutions to secure remote workers.”

Insurtech

world after covid 19 impact insurtech

“Insurers will suffer major losses over the short-term because of this pandemic,” said Noorjit Sidhu, Senior Ventures Associate at Plug and Play Insurtech and Enterprise 2.0. 

  • Writers of life insurance will pay a significant spike in claims.
  • Writers of health and employee benefits will come under mounting pressure from consumers as to how their coverages relate to pandemic-related losses
  • Writers of property and casualty will find consumers buying fewer assets, like cars or real estate. 

The duration of this instability will determine the extent of M&A and the appetite for new innovation that we see over the coming months.” 

“We should also expect a push toward new sources of data for underwriting. As employees largely work from home, the types of vulnerabilities that now arise and must be underwritten by products like cyber liability and workers compensation are a different order of complexity. More insurers will look to optimize their underwriting models to fit the new normal we find ourselves abruptly living in.”

Retail

world after covid 19 impact retail

With the spread of the COVID-19 virus, entire cities have been locked down. How is this affecting global retail? We have asked Carolin Wais, Ventures Associate at Plug and Play Retail. 

  • Essential goods vs. non-essential goods: “There’s been a rapid spike in sales for essential goods, and a significant drop of revenue for non-essential-goods retailers, who have closed down stores and are now facing a shrieking online demand through online channels. Retailers are taking contingencies to face the situation, but the COVID-19 pandemic also has the potential to disrupt the entire retail industry in the long-run.”
  • The importance of online selling: “The stay at home mantra is changing the way customers consume and form new habits. Some people are experiencing the convenience of online shopping for the first time, while the customer journey changes towards an online-only version. Retailers can prepare for this change by improving their online stores so they’re as seamless and customer-friendly as possible. This can be done through innovative "try at home" features, more efficient last-mile services that enable 2-hour deliveries, novel forms of customer communication or gamification elements that engage users. 
  • New business models: “Times of distress“ encourage creativity and lead business owners to explore new business models, such as livestream commerce, virtual events, or digital showrooms. The success of retailers will also increasingly depend on the way data is leveraged. Dynamic pricing, hyper personalization, or trend and demand forecasting are becoming essential rather than a nice-to-have option to stay competitive.”
  • The role of brick and mortar: “With online transactions growing ceaselessly, the role of brick and mortar will keep changing into a more experiential one, where businesses offer a platform that instead of just selling wants to inspire. While no one can give an exact prediction of what retail will look like in 2021 and beyond, we at Plug and Play are eager to support and prepare brands and retailers for the next digital era.”

Enterprise Tech

world after covid 19 impact enterprise tech

The COVID-19 outbreak will force companies who have been slow at adopting the future of work to rethink their business practices and people.

For example:

  • Many employers have added new perks (i.e., physical and mental health solutions) to employee benefits programs as a result of this pandemic and it is likely these new benefits will be maintained;
  • Diversity will likely increase in the workplace as traditional ways of working have not been particularly inclusive to those with different physical and social capabilities.
  • For business continuity, companies are adopting policies and practices to manage the workforce that has to now work from home. This will force companies to explore how a dispersed structure can work within their own organization and will probably see stronger adoption once the COVID pandemic is behind us.
  • Organizations are inevitably experiencing a precipitous decline in revenue, which will result in cost-cutting efforts over the coming months and increase automation efforts.”

A growing list of companies are continuing to pay their employees even with business operations temporarily suspended while others have committed their products to support education initiatives while schools are closed. For example, AllState announced a special payment plan to provide auto and homeowner policyholders the choice to delay two consecutive premium payments with no penalty. Customers can also choose to pay what they can afford, with no minimum payment required. The total unpaid balance will spread across remaining bills. In addition, Allstate will automatically cover customers who use their personal vehicles to deliver food, medicine and other goods for a commercial purpose. Standard personal auto policies typically exclude such coverage. The insurance company is also continuing to pay employees who cannot work remotely. 

Startups are also playing their part. Loom, a video messaging tool, has made their pro version free for all verified teachers and students at K-12 schools, universities or educational institutions who are using Loom for classroom work. The startup even declared that the changes will be permanent unlike the other changes to their plans and pricing in response to COVID-19. 

There are a growing number of companies that are rising up to the occasion and contributing any resources available to them in various ways. We will probably see more CEOs join the list of organizations who commit to lead their companies for the benefit beyond just shareholders and to all stakeholders once we overcome COVID-19. 

Travel

world after covid 19 impact travel

The COVID-19 pandemic has hit the travel and hospitality industry very hard, and now these companies are facing an unprecedented situation and an uncertain future. How will the travel industry be once things go back to “normal”? We have asked Diego Montes, Venture Capital Analyst at Plug and Play Travel.

  • Business trips will be affected: “Many organizations have adopted new technologies that allow them to work remotely in an efficient manner. According to Workplace Analytics, 25 to 35 million American workers will work from home within the next two years, which make up almost half of the workforce in the U.S. There is no doubt that more and more meetings are going virtual. Besides meetings, the global events industry, a sector valued at $1,100 billion in 2018, is also being disrupted by startups like Hopin or Run The World. The growth and acceptance of remote work inside corporations will have an important impact on the corporate travel industry as businesses will have the option to decide if an event/meeting is worth attending in person or if a virtual meeting/event could be an alternative.”
  • Domestic travel vs. international travel: “As we have seen in China, domestic travel will recover faster than international travel, due to travel restrictions between countries and the fact that travelers will see domestic trips as a safer option. People are more likely to choose non-typical destinations, as well as outdoor tours and activities. Ground transportation, particularly road trips in a private car, will also increase before air transportation does. Until a good vaccine is in place, long-haul international travel will be muted.”
  • Restoring travel confidence: “At some point, governments, airlines, and hotels will resort to price-based strategies to promote travel. Discounts, packages, loyalty programs…all options are on the table. Chinese carriers, for example, are reportedly offering $13 seats to fly across China in hope to fill those empty seats. Cleanliness and sanitation will be a must in order to restore travel confidence. Digital identity technologies, wearables, cleaning robots are some examples of startups that will emerge in this space. The collaboration and cooperation between different players will be the best practices needed to win a traveler's trust.”
  • More conscious traveling: “Social distancing” and “shelter in place” bring a wakeup call to a lot of us, who will change the way of valuing and prioritizing different aspects of travel. The length of a trip or review of a destination will simply become less important. Many people will opt for shorter, frequent trips, which take less time to plan and yet bring friends and family together so as to enjoy each other’s company.   
  • Unequal recovery: “The recovery phase will vary based on regions, demographics, and stakeholders. In terms of demographic characteristics, the elderly will probably need more time to start traveling than younger generations. In terms of travel stakeholders, airlines, hotels, airports, OTAs, TMCs and cruise lines will each recover at different paces. Ultimately, both consumers and operators will largely be influenced by each region's responsiveness to control the pandemic.”

Media & Advertising

world after covid 19 impact media and advertising

"The COVID-19 pandemic and the consequential social distancing and work-from-home measures have resulted in major changes in consumer behavior, creating both opportunities and challenges within the Media & Advertising industry," said Tanya Ma, Ventures Associate at Plug and Play Media & Advertising. "There has been a growing appetite for entertainment and content while advertising revenues across the board have declined significantly due to dwindling consumer spending on non-essential goods. Whether these changes in consumer behavior will become the norm or are simply a short-term phenomenon, they will have a great impact on the future of the Media & Advertising industry."

Entertainment and content

  • Since entire populations have been confined to their homes, over-the-top (OTT) and television viewership have spiked. Broadcasters and OTT providers including HBO, Netflix, and Disney are seeing increased viewership numbers, with late-night shows and live sports being suspended..
  • Nielson has reported that, in the Seattle area, total television use increased 22% on March 11 from the week before, while OTT viewership has seen an increase of 50% when compared to the same week in March of 2019. 
  • Likewise, live streaming providers and social media platforms have seen increased viewership during this period. According to the New York Times, Twitch and TikTok saw a 20% and 15% increase in average daily traffic, respectively, since January 2020. 

"We expect the usage of these platforms to continue in the post-COVID era as they are sticky in nature, and their widespread use is quickly becoming the new normal," said Ma. "With social media platforms, wider adoption increases the likelihood that users will continue to use the app due to the inbuilt network effects. For OTT platforms, content is often series-based, which leads to continuation and loyalty amongst viewers."

Advertising

  • The onset of social distancing measures, the dramatic decrease in sales of non-essential goods, and substantial job cuts have contributed to a dramatic decline in advertising spend, especially in the out-of-home (OOH) and live event sectors. Traditional OOH advertising is expected to be the most affected at a 51% spend decline for March and April and 41% for May and June.
  • Digital advertising is expected to decline to a lesser extent than other mediums - at 33% compared to 39% for traditional media from March to June according to the Interactive Advertising Bureau (IAB) - as major players in the biggest hit industries such as retail and travel cut their advertising budgets. 

"The uniqueness of the COVID situation presents itself whereby we are seeing a significant increase in traffic on social media and news sites which is not translating to advertising spend, as per usual," said Ma. "Regardless, there has never been a greater impetus for advertisers to shift online. The pandemic has further forced marketers and advertisers to rethink their advertising channels and especially their messaging, given the heightened consumer concerns regarding the state of the world. Advertisers must tread carefully to avoid any messaging that may appear insensitive to current events and adapt to the new digital way of life."

"As the world recovers from the COVID-19 pandemic, consumers may continue to remain cautious and rely on e-commerce and digital platforms, as currently seen in China. As this becomes “the new normal”, we can expect to see advertising dollars shift to the platforms that have attracted the most eyeballs coming out of the pandemic, whether it be OTT, live streaming, or social media platforms. We expect OOH advertising to recover at a slower rate than its digital counterparts as retail businesses and brands will need time to recover from the impacts of the pandemic and face uncertain demand. Brands who operate in the essential household goods space and those with strong e-commerce presences will be well-positioned coming out of the pandemic to take advantage of prime advertising real-estate at attractive prices across all platforms."

Fintech

world after covid 19 impact fintech

“Access to capital is key for enduring the shift in economic and social dynamics post-COVID-19,” said Kiswana Browne, Ventures Associate at Plug and Play Fintech. “The financial service providers that will thrive are those that address the gap in access to capital for the core of the economy: consumers and small businesses.”

  • Small businesses will gravitate towards fintechs, instead of traditional banks, for loans: “The federal government created the Payroll Protection Program (PPP) to sustain the workforce within small businesses and elected traditional banks to distribute the initial $349 billion in funding. As banks are inclined to serve their existing high value clients, large enterprises were approved for this loan program and the funds were quickly depleted. As small businesses are less likely to have the same level of banking relationships as their larger counterparts, they are left to seek alternative lending options.
    "There are fintech solutions that primarily serve small businesses and have the infrastructure in place to do so efficiently. Algorithms that determine creditworthiness will become robust and increase the number of customers that fintechs acquire by incorporating macroeconomic factors, which will broaden the scope for customer approvals.”
  • Digital banking fintech will dominate the new-to banking customer segment: "Unbanked consumers, such as immigrants and the younger population who do not have access to financial services, are seeking alternatives to cash as policies that include stimulus checks and social orders are implemented", said Browne. "These consumers will be drawn to digital banking solutions because of the focus on customer satisfaction, convenience and financial products that match modern needs."
    "Large tech companies such as Google, which will launch smart debit cards in the near future, are leveraging their global influence to become fintech companies and to potentially capture this untapped market."
  • Traditional banks will accelerate partnerships with fintechs to keep up with consumer expectations: "Banks partner with fintechs to ensure their innovation efforts occur seamlessly. For example, banks integrated with mobile wallets such as Apple Pay and Google Pay for consumers to make contactless payments. As cleanliness is currently a global concern, these solutions that allow consumers to digitally conduct or manage basic financial activities are becoming more critical than ever. In order for banks to keep up with consumer needs, they will partner with proven fintech solutions, instead of consuming resources building and testing applications in-house."
    "Traditional banks have stood the test of time and will continue to do so by accepting the fintech revolution and adjusting strategies accordingly. Banks will increasingly partner with fintechs, not only to innovate current business practices but also to spin off their own fintech companies to truly address the digital era."


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