HOW SOCIAL DISTANCING IS AFFECTING BUSINESS MODELS
As social distancing shifts from a “trend” to an absolution, many companies have struggled to adjust their business models to accommodate the drastic change in market mentality, especially within industries that typically rely on people leaving their homes. Many of these businesses already face competition from at-home, Internet-connected alternatives, and the coming weeks and months will be critical to defending their claim on the market. We’ve analyzed how three of these industries are adapting to social distancing and self isolation.
Social distancing has affected everyone in the fitness industry, from gym and studio owners to fitness instructors. In fitness, physical presence is pretty pinnacle to peak performance—so many businesses felt the impact from the onset. After all, it’s not just about how “clean” the gym is if people have to face the perils of public transportation to get there. Realizing this, many gyms and studios closed their doors before the government mandated it.
That might have been the end of it, but for the fact that fitness is founded on the “break outside your limits” mentality. Many gyms have already found a way around their “physical limitations,” offering online workout courses people can take from home. Big-name gyms like Crunch and Planet Fitness are offering online workouts for free. Meanwhile, smaller boutique studios are stepping up to the challenge, from posting daily at-home workouts on their social channels to offering free online classes.
At-home fitness businesses are also thriving. Peloton has seen a 12% rise in shares even as the rest of the market crashed. Similarly, Obé Fitness claims signups have increased ten-fold, and the company has added new workouts and wellness options—even going so far as to offer a free first month to new subscribers.
The explosion of online fitness options over the past weeks only emphasizes the industry’s dedication to serving its clients. As gyms and studios have shifted their service offerings to suit the needs of their audiences, they continue to offer their core value to their clientele: community.
Most school districts in the nation have now closed their doors, and while many have already kicked off online learning programs, others are still trying to figure out how to proceed. From infrastructure to lack of Internet-connectivity in student homes to serving students with disabilities, the challenges facing school systems seem endless and insurmountable.
In response to school closures, dozens of companies that produce educational materials have made their resources available to students at home. Multinational publishing company Scholastic recently launched its “Learn at Home” website, with daily courses for students from pre-K to grade 6 while online learning site ABCmouse.com is offering a free 30-day trial of its early learning academy. Educational YouTube channels have also beefed up their offerings. Crash Course is creating engaging educational videos for high school students. Meanwhile, Khan Academy, a free online learning resource, is offering lessons, exercises, and quizzes as well as daily schedules to help parents organize online learning.
Higher education has also changed drastically, with over 3,278 colleges and universities closing their campuses and moving classes online. These universities face not only the challenges associated with online learning, but additional logistic concerns, such as helping their students return home. While some schools offered free shuttle rides to the airport and refunds for the remaining cost of room and board, others made exceptions for students who could not easily travel, such as international students and students with suppressed immune systems. College admissions have also been affected, and many universities have already started creating more online content for prospective students, such as virtual tours. Across the board, universities are also electing to extend the deadline for admission.
Even amidst the uncertainty, it is clear that educational institutions are finding ways to continue to support students of all ages. With tremendous support from outside resources and the advantages presented by online video conferencing, it is only a matter of time before schools and universities create a new forum for education.
With streaming services such as Netflix, Amazon Prime Video, and Hulu already posing a significant threat to traditional paid TV services, social distancing could have an enormous impact on the entertainment industry. While roughly 80 million Americans still subscribe to paid TV, polls have emphasized the importance of live sports such as ESPN, TNT, and TBS in their decision. Yet new social distancing guidelines have resulted in live sports coming to a standstill worldwide, which could prompt even more people to make the switch to cheaper, online options.
Streaming services have clearly taken advantage of this weakness, stepping up their service offerings to make themselves even more enticing to bored viewers trapped at home. Disney Plus recently released Frozen 2 ahead of schedule while NFL Game Pass is offering complimentary access to replay all games until the end of May. Amazon Prime has a “Movie Theater Release” section where viewers can rent/buy the movies that were supposed to come out before theaters shut down.
Still, some live broadcasts have made an attempt to stay on the air, even from home. TV-host Conan O’Brien will be making new episodes of his TBS show from his home. Similarly, musicians who had to cancel live concerts have decided to livestream from their own homes on social media as part of a new series called “Together at Home.”
As artists and entertainers look for new ways to connect with their fans and streaming services continue to expand their service offerings, one thing is clear: none of us stuck at home will run out of ways to entertain ourselves.
Social distancing has changed the way many companies are conducting their businesses and as the market’s needs continue to shift, serving customers’ needs becomes more important than ever.