Of the many changes we’ve seen in the past 8 months, which will stick and which won’t? The massive reduction in air travel could well be temporary. The growth in demand for online shopping and services, will likely be a keeper.
As an SME, you’ll almost certainly have seen shifts in what your customers want, and/or how they want it delivered. The strong likelihood is the situation will continue to evolve.
Do you have digital and data mining processes in place for detecting and analysing further changes in customer behaviour? These will occur in response to a range of developments like the lifting of shutdowns, border re-openings, travel bubbles and increased hygiene practices.
According to The Harvard Business Review studies on habit formation suggest it takes a minimum of 21 days to learn a new habit, but in reality the average timeframe is closer to 66 days (just over 2 months).
By now, the pandemic’s severe disruption has lasted long enough to cause fairly major shifts in habits that had previously been the foundation of demand and supply.
According to Australia Post, between March and August 2020, over 8.1 million households shopped online, an increase of 16% when compared to the same time last year. Importantly, over this same period more than 900,000 new households shopped online for the first time. That’s 35.4% more than the same period in 2019.
Travel habits have undergone a huge shift. With the explosion in online conferencing, it’s hard to see how business travel will ever go back to pre-pandemic levels.
Domestic tourism could boom in the next one or two years, only to drop off in favour of long-haul destinations once (and if) a vaccine is developed. There’s potential for huge pent-up demand with overseas tourists thronging back to Australia when interstate and international travel is permitted again. Or will they become travel-shy, and look to explore much more of their own respective backyards?
For a kind of precedent, we can look to the 9/11 terrorist attacks. According to the Harvard Business Review, the aftermath of the attacks caused only a temporary decline in air travel. Instead, they created a lasting shift in consumer acceptance of the trade-off between privacy and security. The result has been permanently higher levels of screening and surveillance.
COVID could potentially create long term greater expectations of hygiene and health screening practices.
Investing in your digital offering is a priority like never before. A new McKinsey Global Survey of executives has found that since the pandemic, companies have accelerated the digitisation of their customer and supply-chain interactions, and of their internal operations by an average of three to four years.
Most of the respondents said that their companies implemented at least temporary solutions to meet many of the new demands, much more quickly than they would have thought possible before the crisis.
At the same time, the respondents expect most of these changes to be long lasting and are now making the kinds of investments to ensure they will stick.
Think about your business’ digital processes whether they’re going to serve you into the new normal. Look at things like:
- investments in data security
- whether you need to accelerate migration to the cloud
- a decrease in the physical footprint of your business
- investing in technology for competitive advantage, or
- refocusing your entire business around digital technologies.
In part 2 next time we’ll look at busines continuity planning and preparing for future pandemics.