10 ripple effects of COVID-19, you should keep an eye on in 2020

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The shock from Covid-19’s high-speed spread had brought not only a health crisis but also an economic emergency that may roll into one of the largest recessions our generation has faced. This has and will further cause major disruption in what we called “everyday life” as more than 3,5 million people have tested positive around the globe. Many studies suggest that even after the lockdown ends, the social distancing measure may become the standard way of life at least in the year 2020.

At present, it is difficult to foresee when this situation will end. For sure, a lot of business may never come back on the market after such a hit. Many new businesses will erupt in the aftermath of this calamity. For some, 2020, in effect, will be a year lost and the challenge will be getting into 2021.

The longer the economic disruption and behavioral shifts sustained, the more will normal behavior have a shift, as per the 21 Day Habit Theory introduced by Maxwell Maltz. Nevertheless, at present, the only way to survive this situation from a purely economic point of view is by relying on human-centered digital solutions. It is being said, if you are not present online, you are asking for major trouble.

For this purpose alone, I have searched for 10 ripple effects on the socio-economic sphere by COVID-19. The ripple effect is not all in one but divided into three phases that are an immediate paradigm shift, and the unforeseeable future changes.

The following table shows the major shades of the 3 phases that are explained in detail later:


Phase-I: Immediate effect

Phase-I or the immediate effect includes the effects that we felt in the very first month of the COVID scare that started from the time of increasing numbers of positive cases as well as announcements of lockdowns in a segregated manner depending upon state and federal intimations. Phase-I comprised of 4 ripple effects which include:

1. New growing and declining categories

The first and foremost effect that we saw was the increase and decrease of certain items on the market. For example, toilet paper, masks, and sanitizer demand skyrocketed in the very first few days. Similarly, after the first few days, sales of gym equipment and packaged food picked up. In the same manner, certain commodities like outdoor equipment (tents, grills, swimwear, golfing equipment) saw a considerable decline.

This has been depicted by Stackline which analyzed eCommerce sales across the U.S.A and compiled a list of the fastest-growing and declining eCommerce categories (March 2020 vs. March 2019) with surprising results. We can see that toilet paper has seen more growth than baby care products, and cured meats have seen more growth than water. But while some categories are experiencing a drastic increase in demand, others are slumping in the pandemic economy as luggage or cameras.

2. At home, entertainment is picking rise

This was all but natural as lockdowns were initiated but work from home procedures was not. Similarly, high school and middle school kids were sent home where they had not much to do. Therefore, they resorted to downloading more online content and games for entertainment. This was depicted by Netflix’s Q1 2020 results as the video streaming service brought in 16 million new global paid subscribers. Disney Plus Racks Up 50 Million Subscribers in 5 Months. Furthermore, this new wave of entertainment is predicted to continue even after the lockdown ends.

On the other side, the restaurant business got severely hit. The ones with an online presence have contributed to home entertainment rise which includes ordering out and sitting in front of the T.V. However, those companies with no digital presence, there is no other choice but to play the waiting game.

3. Travel falling off a cliff

One industry that was hit the heftiest blow, out of which some say several businesses won’t service in the travel and tourism industry. As the COVID-19 pandemic has spread to over 100 countries, many governments have implemented sweeping travel restrictions. Not only has this brought a decline in traveling equipment sales, but tickets, reservations and naturally put a halt on foot traffic earnings on streets of Milan, Ibiza, London, New York, Delhi, and almost all tourist destinations.

As a result, Booking Holdings, the parent company to Booking.com, Priceline, Kayak, and OpenTable, witnessed share price declines of over 35% since the peak. In under two months, the share price of Delta Airlines has fallen over 50% as the company anticipates a capacity reduction of 40%, the largest in its history.

According to the World Travel and Tourism Council, a staggering 50 million jobs are at risk in the industry, with 30 million of those jobs belonging to employees in Asia. Considering that the travel and tourism industry accounts for 10.4% of global GDP, a slow recovery could have serious ramifications.

Consumers globally do not intend to undertake international travel anytime soon, while governments in several countries—except for Germany and France—plan to restrict domestic travel as well.

All these factors are reflected in the graph below that depicts a gross reduction of over 60% revenue for April, May, and June that are ideally the most profitable months in the tourism industry.

4. Students shifting from in-person to virtual classes

After a couple of weeks, the EdTech sector realized that learning institutions may not open for a considerable time. Therefore, it took a natural rise as most adopted the online route. Large-scale efforts to utilize technology in support of remote learning were made and evolved at a fast pace. Educational institutions have closed in 107 countries, affecting more than 860 million students and counting. The EdTech sector has leaped to a prominent position, making it of particular interest to investors as it reshapes how we learn in real-time.

This has been the debate of the 21st century whether to promote distance learning or not. Well, it has been found out that distant learning methodology was the way to go for the future, and COVID-19 may alone bring this shift in the education sector.

The World Bank believes we are in the grips of a learning crisis, where 60% of children globally fail to achieve minimum standards of reading and arithmetic because of poor-quality teaching. Even when students are learning, their education often doesn’t include the skills they need to succeed at a time of unprecedented automation and technological disruption.

Phase-II: The Paradigm Shift

Some of the ripple effects were felt after the first month of everything shutting down. These are the ones that may convert into the norm depending upon the length of the Pandemic situation. Phase-II comprised of 3 ripple effects which include:

5. Leveraging on digital to reach work-life re-balance

The next industry to realize the need for a lockdown but running operations was the corporate sector. They knew that killing the switch will be an economic disaster from which even several big players could not have survived. Since 100% of the 20 largest economies are now in some form of lockdown, ‘shelter-in-place has changed daily routines.

For years we have been all exchanging about the benefit of remote work and the impact on work-life balance, I remember the first time I negotiated with my employee remote work twice a week because of the long distance between work and home. Today there is no choice.

Therefore, online meetings have taken center stage and private chats have taken over the water cooler gossips. Video conferencing company Zoom released data showing a 30 times increase in just four months with daily users in meetings reaching around 300 million. That’s an astounding increase from the daily user rate of 10 million in December of last year. Similarly, Microsoft Teams 20 million user base increase in one month and Slack has also seen a sharp increase in daily concurrent users, with more than 12.5 million.

6. Accelerating adoption of offline-to-online

A large section of the population till went to the store to buy groceries or stood in line at their favorite pizza (delivery only) place. The adaptation to the new way of life has been such an immense factor that many people are now shopping online. Therefore, big, medium and small size businesses are moving to provide consumers almost all products and services online. The major trends are grocery shoppers shifting from going to store to ordering delivery. Consumers have also expanded their usage of restaurant and grocery delivery as new ways to procure food safely with limited in-person interaction.

There are many examples of business moving to the digital sphere, from offering pick and collect to booking services via online, to local restaurants shifting from four-top seating to curbside pick-up, local stores adapting to sell products on information-only websites or my fruits and vegetable store offering a Google form to order every week. Businesses that were lacking in online presence are making a concentrated effort to be seen in daily advertisements. With more people online than ever, the chance of a business surviving through the online route is immense.

7. Evolving on-demand work

As many economists and money makers of the past said that with a demise in the economy comes hugs opportunity of fortune building. Similarly, the paradigm shift of on-demand work skyrocketed. There are practically two reasons for this. One, several people are required to handle the delivery part of the business. The second reason is that people don’t want to hire permanent resources at the moment so they are investing in the on-demand workforce, especially in the departments of transportation, supply chains, groceries, and healthcare.

Job postings from online job marketplaces like ZipRecruiter highlight significant growth in transportation (trucking), e-commerce (warehousing / supply-chain), and healthcare. Instacart announced it was looking for 300 thousand full-service shoppers and Amazon indicated it was looking for 175 thousand warehouse and delivery workers.

This also may move from Phase-II to Phase-III once the lockdown extends over time. This trend can and will allow workers who lost their job to sign up for work on multiple platforms and schedule hours around life commitments such as childcare and/or education. We may be looking at a 10% job reduction in the USA and 20-30% in Europe. This is the way out in the current scenario as well the near future, for both business owners and the working class.

Phase-III: The Unforeseeable Future 

Some of the ripple effects will be long-lasting or at least I think will not be going anywhere anytime soon in 2020 or even 2021. These effects will convert into the norm irrespective of the Pandemic situation. Phase-III comprised of 3 ripples (+permanent) effects which include:

8. From social distancing to digital socializing

People are making use of communications tools in their personal lives as well, to stay connected with their loved ones. This may be the way of life when bridal showers and birthdays are celebrated online more than a local café or bar. I was asking one friend how her 11 years old is doing regarding being homeschooling alone at home. She answered not a major issue, she has a date every day at 5 Pm with her best friend via ZOOM. They chat for 30 min and then she feels great about it. I thought I should do the same.

According to Priori Data, global downloads of Skype, Houseparty, and Zoom each surged by more than 100 percent in March alone, particularly popular among people meeting up virtually while being confined to their homes. Zoom, the video conferencing app was downloaded nearly 27 million times in March, up from just 2.1 million times in January which can be seen in a glance from the graph below.


9. Increasing stress and mental issues

The outbreak of coronavirus disease (COVID-19) may be stressful for people. Fear and anxiety about a disease can be overwhelming and cause strong emotions in adults and children. With 1 in every 10 people already facing mental issues, the lockdown may not be easy to fight with even when it is over.

Moreover, the stress of staying home at all times and not being able to go out in self is a disease. Furthermore, the stress of not being able to provide for the working class and losing all savings + business value for business owners can very well be a stressing factor pushing the human body to the limit. Remote therapy has started to pick up and may become an eventual trend in the future.

Apart from mental strains, the physical part of it will also take toll since doctors are currently not able to visit patients and some patients with underlying conditions are afraid to visit medical facilities.

10. Faster adoption of on-demand platforms

This will surely be a part of the norm while we come out of COVID-19. There is a rise of on-demand platforms that deliver groceries and food as Instacart,  DoorDash, Uber Eats…; for example, Uber Eats has reportedly seen a 30% surge in customers signing up for the service and it has received an influx of new drivers as well.

These platforms have experienced surging demand and are aggressively bringing on new workers, in addition to providing demand to local grocers, restaurants, and other essential stores. This trend is there to stay and may haunt us for the unforeseeable future since the consumer is getting used to the comfort of these services.


Coming out of the COVID-19 (whenever that may be), there will be winners and losers. Winners will most certainly be those who adapted to changing times and faced their disruptions rather than hiding from it. Consumers globally are feeling its economic effects and are still pulling back dramatically on discretionary spending. During the pandemic, they have taken up new ways to learn, work, entertain themselves, procure essentials and non-essentials, connect with others, and increase wellness while at home.

Saying so, the same amount of money was spent online in March that was spent in the holiday season (December). This means that there are equal opportunities to innovate, but you need to take care of the ripple effects. However, with increasing weeks of the COVD-19 and extension in lockdown, the trends may change and spending may become scarce. This will only lead to human-centered digital solutions for most worldly physical problems.

Meanwhile, the question remains: will this drastic change in consumer behavior stabilize once we flatten the curve, or is this our new normal? But as each country moves along the COVID-19 curve, we can see a glimmer of increasing optimism levels, which in turn is linked to higher spending. Looking ahead to the “next to normal,” consumers remain hesitant to return to some of the activities that were part of their daily life before the start of the pandemic.

Keep in mind the current phase of the paradigm shift and the future one right after the curve starts to flatten. This way you can plan your business strategies for the near and far future.

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