As the Covid19 pandemic continues to disrupt the global economy and social systems, causing untold hardship and gloom for businesses, a lot of online businesses are yet to prepare for the post Covid19 economy.
Notwithstanding possible measures put in place to stem the outbreak, analysts believe the Covid-19 can cost global economy more than a whooping 2.7 trillion in losses.
This may sound like some doomsday predictions but indeed, the future looks bleak and unpredictable.
And above all there are speculations it could take up to 3 years before the global economy winds off the effects of Covid19. So there could be worse days ahead.
What can you do as an online Business?
It’s true. Most online businesses hardly ever prepared for an outbreak of this magnitude. For such, there’s hardly any prior plans for the imminent economic downturn.
But, since this has happened, there are precautionary measures you could take that will definitely ameliorate some of the effects of the Coronavirus outbreak on your business.
Effects of Covid-19 on Small Businesses
Below are the 7 effects of Covid19 and how they could possibly affect your online business…
Major Spending Cuts.
A lot of companies are already feeling the brunt of the economic crunch occasioned by the virus out break.
Large scale travel restrictions and Social Distancing have spiked a sharp fall in consumer spending thus leading to a slow growth in global economy.
According to a report by Mckinsey, the impact of Covid19 could lead to similar economic crisis experienced during the 2008 global recession.
For this reason, to be able to keep their business running, most companies will have to cut cost.
This is going to be one of the biggest effect of Covid19 on businesses and it will lead to serious boomerang effect beyond the digital world.
Jobs will be lost as companies strive to reduce cost. Most workers will be laid off.
A lot of services will most likely be out sourced to virtual or external companies at a cheaper rate while most other services will be discontinued.
Increased Need to Set up Online Businesses
Lack of jobs and a crushing economy will make running online businesses more attractive.
For the fact you don’t need a physical office, store etc, the cost effectiveness of running an online business will inspire individuals to set up businesses online.
This would be a good time for Web Developers and others to sharpen their skills and reach out to a new audience.
For most existing businesses, the increase in competition could possibly pose a threat and decline in business revenues as newer businesses would tend to bring down their prices in order to attract clients.
This will in the long run force some existing service-based businesses to cut down their prices…
In the end, due to a slow economy and reduction in consumer expenditure, the average cost for building websites and web related apps will be far cheaper. But the demand will be slightly higher still.
Increased focus on International Transactions.
With widespread increase in cases of the Coronavirus across the world, analysts believe it might take years before the the world can recover from the economic loss due to the pandemic.
Coupled with the slump in crude oil prices, a lot of marketers and web developers in oil exporting and most developing countries will have to target their services at advanced countries as most local businesses will be less able to afford a decent price.
Doing this successfully will in the long run cushion the effect of the economic down turn as subsisting inflation in most countries will increase the value of every dollar earned.
Surge in Demand for Designs
As businesses strive to get back on their feet after the long Covid19 induced break, there will be an increasing demand for Graphics Designs and other Web Design Services.
This will partially drive the demand for Graphics and Web Designers. Although the opportunities may not be as lucrative as it was prior to the Covid-19 era.
Reduction in cost for PPC Advertising.
With an increasing economic downturn, a lot of businesses will abandon online advertising in order to cut cost.
This will play a role in forcing major advertising companies like Google, Facebook etc to cut down their cost per click and other advert rates.
For a business with a deep pocket, here’s a good time to work on increasing your advertising expenditure.
The lack of adequate competition will not only drive results, it will increase your ROI at a higher rate and less cost.
For businesses with less advertising funds, this will be a good time to focus on content marketing to drive both organic and inorganic traffic.
Fluctuating Investment in Website Maintenance and Social Media Management Services.
As the economic crunch bites harder, most small businesses will cut off unnecessary expenditure while increasing the workload for in-house staff.
For this reason, a lot of service based businesses like Website Management, Social Media Management etc will get less and less engagement. And may be pushed to downsize their work force.
At the same time, a lot of medium Enterprises and MSMEs with a larger work force will focus on downsizing their work force to cut cost.
They will in turn work on outsourcing some of these services to service based agencies at a cheaper cost.
To be strategically positioned for this opportunity as a web agency, you want to have a team, a well known brand and a very affordable cost in place.
You’ll also want to have a track record of getting the job done and a reasonable testimonial from clients as social proof.
More Investment in Content Marketing
Most businesses will embrace Content Marketing.
As a result of the cash crunch, post Covid19 online businesses will witness far less cash to spend on online advertising.
For this reason, there will be an increasing need for Content Marketing to keep an inflow of traffic.
This in turn will create an increasing demand for Content marketers and Content Marketing Agencies as a one time investment on content marketing will in the long run create a steady flow of traffic, compared to advertising.
Increasing Expenditure on Cyber Security
One of the most proactive measures put in place to curb the spread of Covid19 across the world has been social distancing.
With increasing adherence to social distancing, people are becoming more dependent on digital tools to communicate.
Many other individuals are depending on these tools to work from home. These and many more have created a higher risk for hackers and other cyber criminals to target these digital tools.
As the Coronavirus outbreak pushes even more people to increasingly depend on the internet and other digital tools in order to stay connected, a cyber attack that deprives individuals and organizations access to their devices can pose a serious threat to businesses.
Recently, an attempt has been made to hack the website that publishes statistics on Coronavirus. Such incidence if successful can lead to major disruption in stats and data breach.
Thus as part of the effects of Covid19 on businesses, there’s an increasing need to put up reliable cyber security measures as businesses continue to depend on the internet for communications.
This incidence will cause a slight increase in expenditure on cyber security either for purposes of creating awareness or fixing vulnerabilities and possible data leakages.
In conclusion, notwithstanding the gloomy pictures out there, with the right approaches, as businesses; we will definitely triumph in the end.
So as we strive to stay safe and conquer Covid19 together, you want to protect your online business and prepare for better days ahead.