Post-COVID: Which Behaviors Will Stick?
APRIL 13TH, 2020
IIt’s a strange time right now. Humanity is collectively focused on COVID-19, and it is changing the way we live. An interesting question, and an important question for investors is- what are the major economic, social and individual behavioral changes from what's happening right now that will never really reverse? Which of these changes will we still be able to recognize in 15 years time?
From an economic perspective — beyond the obvious massive short-term damage due to a halting of large swaths of the economy — there will also be some amount of permanent restructuring. This includes re-thinking supply chains, likely with a focus on local rather than international footprints. This includes re-thinking cumbersome regulatory frameworks whose inefficiency have been laid bare in light of the crisis. Macro-scale restructuring of this nature is not the focus of this article, but is something investors need to contemplate.
The most obvious behavioral change is the impact on business travel and remote work. Everyone who can is learning how to do this now. If you buy the theory that what happens in California will hit the US five years later, and the rest of world after that (perhaps faster now), I think the fact the Silicon Valley went virtual and more or less chugged along without missing a beat is significant. I think this means that moving forward, it’s going to be much harder to justify an in-person-only culture. Virtual conferences & meetings will not totally replace their in-person counterparts, but will remain more prevalent than pre-COVID. The bar for justifying work travel will be permanently elevated.
The crisis has forced many Americans to become users of food and grocery delivery services. The number of active users for these platforms has increased by an order of magnitude over the course of the past couple months. Not all of these users will stick, but many of them will. A sector that seemed to be teetering prior to the crisis will come out of it bigger, stronger and will be a permanent part of the American food-chain.
COVID has busted open the digital socializing Overton Window. Social use cases for apps like Houseparty and Zoom have brought social video-conferencing to the masses. This is here to stay. Social video streaming platforms like Twitch have outperformed video platforms without a social component (Netflix, YouTube, etc.) during the crisis. I suspect we will see more social video platforms built and existing platforms lean into social features moving forward. Similar to social video, social gaming has exploded during the crisis. Games like Fortnite and VRChat (portfolio company) have skyrocketed in terms of new and active users. New social games such as Valorant and Animal Crossing have launched during the crisis and become instant sensations. We call these applications 'games' today, but they are looking more and more like next-gen social applications every day. COVID accelerated the transition from game to social application, and it will continue once the crisis subsides.
Using technology to track, trace, predict and prevent outbreaks will be the new normal. AI will monitor data from devices such as wearables, smart thermometers, cross-referenced with data from Google searches and hospital data to flag potential hot spots. Apple and Google are set to launch an appliacation that will send a push notification to let users know they've been in contact with a COVID positive person based on tracking data from users' phones. A new digital layer of disease tracking, monitoring and alerting will come out of this crisis, as will related privacy concerns.
Telehealth and automation of healthcare tasks will both advance significantly. In the case of telehealth, we are talking about a massive institutional change happening now that requires learning new behaviors on-the-fly. We are seeing years-worth of change occurring over a matter of weeks. It’s astonishing. Once this infractructure and user-base is in place, it will be here to stay. Automation in healthcare will come after the crisis. The more we can automate procedures to protect (not replace) healthcare workers, the better. There will be pressure from politicians and healthcare unions to do this. It will help keep healthcare providers safer when the next pandemic hits and it will help keep the public safer by increasing the surge capacity of hospitals/clinics.
A massive number of institutions, organizations and individuals are learning new behaviors right now, not all of these behaviors will roll back when this crisis is all over. Not everything will stick either, but I suspect a lot of what's listed above will.
