COVID-19 is creating economic upheaval the likes of which we have never seen before, and has moved us into a ‘Low Touch Economy.’ This new global reality means businesses need to develop innovative solutions to safeguard the health of consumers and workers, and respond to changing consumer demands, if they are to survive.
The 50 ‘Low Touch winners’ (or companies that are already flourishing in this challenging new climate) demonstrate two key criteria:
Financial growth, such as increases in revenue, profits or stock value; attracting new markets, customers or partnership deals; or improved branding and reach.
Preparedness for the Low Touch Economy: based on our Readiness Scorecard, we evaluated companies based on how dependent they are likely to be on close physical interactions between people, indoor gatherings or large outdoor gatherings, and a range of other factors.
A Low Touch Economy will be driven by those companies that enable remote and digital interactions, and respond to new consumer behaviors.
Some companies have business models practically designed for them to flourish in a Low Touch Economy – think Amazon or Zoom – but a good starting position doesn’t mean you will win the race, as the market is flooded by disruptors and new players looking to capitalise on the Low Touch world.
Our leaderboard also showcases companies that are already pivoting and redesigning parts of their business model. Our bets are on those companies that can show the most agility.
Some of the trends we have found across this month’s 50 winners:
Restrictions on in-person meetings and workplace environments have resulted in an urgent need for better digital workflows and IT services. Our winners-list includes companies providing cloud infrastructure (Amazon, Veeva), cybersecurity services (Fortinet), telco & communications services (T-Mobile, Zoom, Twilio), and automation services (Hexagon, Rockwell Automation). These businesses are rapidly building new foundations forcompanies to reliably connect with their clients in an increasingly digital world.
Enabling virtual creativity
Many products in the Low Touch Economy will be ‘virtualized’. The winners in this new era will play with data, virtual graphics, and creative problem-solving tools. Nvidea, AutoDesk and Matterport are all active in this space. Keep an eye on those creators who can combine the power of machine learning and algorithms with visually enriched data: think 3D scanning or virtual environments.
People are adapting to a safer and often more convenient way of living. Food and products are delivered to your doorstep (Instacart, Delivery Hero, Shopify). Gradually homeowners and businesses are investing in safer spaces in which to live and work. For some people, it’s finally time to start that home renovation project. Some businesses may need essential upgrades to be allowed to open up again, like new security gates or access points. Several winners are active in this space of facilities management and infrastructure upgrades, including Home Depot, Fastenal and Kone.
Investing in yourself
To feel better in these difficult times, some customers are investing in a healthier lifestyle. Home gym equipment brand One Peloton is a clear Low Touch winner, as is Lululemon, selling yoga pants and sportswear. Established companies like L’Oreal are in a perfect position, with sales of make-up sales and small personal treats on the rise. It’s important to note that all these companies had already invested a lot in digital channels and services, even before the pandemic: which is paying dividends in a Low Touch world.
Disconnect from reality
People are feeling more anxious than ever before, and we are seeing an increased demand for insurers, like Progressive, to help put people’s minds at rest. But the major trend is consumers searching for distractions, to take their minds off the doom and gloom of the pandemic. . Most digital entertainment services, from streaming to gaming, are experiencing an unprecedented rise (Netflix, Activision Blizzard, Ubisoft). Gambling, too, is on the rise. While sub brands of Flutter Entertainment support betting on sports events and similar, we see that other consumers are “betting” on the stock market, with services like the investment app Robinhood seeing an enormous increase in user growth.
We will continue to dig for the trends, sectors and companies that will win out in the Low Touch Economy as we update our leaderboard in the months ahead.