There’s no escaping the dismal news — the COVID-19 pandemic is wreaking havoc globally on lives, families, the workplace, and businesses’ bottom line both large and small. The impact that global “social distancing” and business shut-downs will have on the global economy is yet to be fully quantified. During the SARS and MERS epidemics, there was temporary pressure on the business supply chain — but the impact of COVID19 will be at a far greater scale.
It “could be felt for as much as two years and cost up to $400 billion for business supply chains,” according to the Boeing Center for Supply Chain Innovation. HBR pointed out in late February that “the 2002-2003 SARS epidemic created just a blip in the global financial markets…[but] the relative importance of China in the worldwide economic ecosystem has increased tremendously in the past 18 years….and many more industries are now heavily dependent on China.”
Despite this gloomy outlook, many brands immediately leapt to “do their part,” which was inspiring to see. According to Fast Company, LVMH was the first to adapt its production line to make hand sanitizer for local hospitals and communities; KFC quickly partnered with the nonprofit Blessings in a Backpack to help provide weekend meals to kids with food insecurity, and Netflix set up a $100 million relief fund, including a $15 million for donations to organizations working to support out-of-work production employees.
But of course, despite brands’ best intentions to be good global citizens, most will feel the strain very quickly. A survey in March of more than 2,200 marketers by Econsultancy and Marketing Week showed that 55% of UK and 56% of North American marketers say that marketing campaigns are now delayed or under review. There is no doubt that marketing activities will be significantly curtailed as a result of the global economic downturn.
Consumers Have Flocked Online
EMarketer reports that — despite the fact that the majority of marketers (77% in the UK and 64% in North America) predict consumer delays in major spending decisions — most also predict a rise in other areas. For example, with consumers now socially distancing or self-isolating at home, ninety-one percent of UK and 87% of North American marketers predict an increase in the use of online services (gaming, entertainment, social media etc), and 70% of UK marketers and 75% of North American marketers predict that there will be an increase in eCommerce usage such as online grocery shopping. Working from home has also increased exponentially with up to half of American workers currently doing so (as of April 6), more than double the fraction who worked from home (at least occasionally) in 2017-18.