The ongoing health crisis has forced many business around the world to pivot their strategies in order to survive and answer clients’ needs – take restaurants-turned-grocery shops and hotels retrofitting rooms into remote offices. But are these short-term solutions or do they reflect a sustained shift in the way we will consume and do business?
The food and drink sector is among the hardest hit, with bars and restaurants unlikely to open at full occupancy until the late summer in many countries. Aaron Caddel was running Mr Holmes Bakehouse, a successful bakery business in California, and supplying over 60 coffee shops in LA and San Francisco alone before the coronavirus brought things to a standstill in mid-February.
Like many in the hospitality sector, he started selling lockdown kits. He never expected his home-baking kits to supplant his previous wholesale profits. ‘I had zero faith in a retail strategy that could go back to the way things were any time soon,’ he says. ‘It was a question of meeting people’s needs in quarantine and what life looks life after. One: self- sufficiency – we had never seen food shortages in California. Two: people have time on their hands and want to get savvier in the kitchen.’
Caddel is unequivocal, however, that a successful pivot doesn’t mean longevity if it’s just out for profit. ‘What’s going to outlast this is food innovation and improving people’s quality of life. Donald Trump can’t just flip on a switch and say: “Back to restaurants like you used to”. E-commerce will be bigger, for sure, but consumers are getting fatigued by a value proposition that’s just: “Hey! Keep us in business – buy something.” It’s a bit tone deaf because we’re all in a hard time.’
Whether baking at home or using public transport, all our new behaviour is grounded in risk. We’ve become more cautious. Face masks are the most vivid embodiment of this and will likely become everyday accessories even in ‘peace-time’, much like in China or Japan. London-based fashion designer Florence Bridge – whose label is one of the many to capitalise on this new consumer behaviour – thinks this is particularly true if designers can give the face mask style and individuality. ‘I think they look really cool – especially when you’re wearing a matching dress or shirt,’ she says. ‘I would love to make masks a part of my collections. Until there’s a vaccine, I think there will be demand for them.’
However, although we can project some trait changes and speculate what business models might come out on top in this new world we are currently living in, the bigger picture is more murky. ‘Right now it’s too early to tell because most people are operating on a survival mentality. The wild card here is the sense of safety that’s been threatened,’ says Rahaf Harfoush, a Paris-based strategist who teaches innovation and disruptive business models at Sciences Po’s masters of finance and economics programme in Paris. ‘
One of the biggest lessons of the pandemic is the need for diversification in terms of revenue streams,’ she continues. ‘Everyone realised that those who only had one revenue stream that was dependent on real-life interactions took a hard hit. I anticipate a mindset where people hedge their bets by having more diversified jobs and projects.’