Thriving Businesses during the Coronavirus

By: Veronica Baladi

It’s no secret that COVID-19 is responsible for the downturn of companies, which were once major dominators. Household brands like Neiman Marcus, Gold’s Gym, and J. Crew cited the coronavirus as a reason for bankruptcy.

Though the pandemic has been responsible for the decline, struggles, and even extreme cases like bankruptcies for a myriad of businesses -from big names to smaller businesses- countless others are now prospering.

The most blatant, straightforward winners seem to be businesses in the cleaning industries. For example, Clorox is famous for its wipes, sanitizers, and such. Overall, Clorox skyrocketed 15% for the first quarter of 2020, which is correlated with the increasing need to sanitize. Mass media channels, whether it be the government or Hollywood A-Listers, are spreading information to wash hands, clean surfaces, and be extra careful. In order to do so more often, more supplies are needed. To obtain more supplies, people turn to these businesses and as such, they gain profit.

This affluence is not only limited to “essential” businesses. There are a great deal of non-essential businesses that are doing remarkably, which may strike one as surprising. For Electronic Arts, a mainstream video game company, their fourth-quarter revenue grew 12% compared with last year. Nintendo, particularly the Nintendo Switch, is also seeing massive success.  Not only is the physical console seeing increased demand, but the newly made game “Animal Crossing: New Horizons” has shattered records, selling over 13 million units within its first six weeks of release.

Already a dominator in the streaming industry, Netflix has gained over 16 million new subscriptions in the first quarter of the year and that number is only surging upward. AllianceBernstein analyst Todd Juenger notes that this is favorable for the long term. If and when the pandemic, which is still in the unknown, people will be hesitant to terminate their loyalty to these somewhat pleasurable, addicting services. Though he says this in regards to Netflix, this may certainly apply to currently successful companies in the overall virtual entertainment industry, like Spotify, Hulu, and so on.  Since people are seeking distraction during what may be an idle time in quarantine, they may begin to utilize these services. In turn, these companies all greatly benefit.

Zoom has also become a household staple during this time, even though it has existed for nine years. With only 10 million users in December of 2019, March 2020 saw 200 million users, which continued to surge to 300 million users in April 2020. In addition to its typical uses for a personal video call or conference call, Zoom is now being implemented in virtual school settings. With its Education plans, Zoom has a new niche, target audience for this indefinite time in shutdown. Even after social distancing is raised or if schools reopen, schools still may opt to continue to use Zoom if there is a circumstance that in-person interaction is not available. Zoom specifically is preferred to competing video calling services because of its simplicity, fun green screens, and smooth conferencing. The introduction of Zoom to a mainstream audience has opened an outlet for the future of Zoom to continue to expand and flourish.

These are just a few of the businesses and industries that are thriving, not including more traditionally recession-proof areas like food, now elevated due to the increased use of dine-in-home delivery with apps like Uber Eats; healthcare, since people who have access to will continue to retain their insurance; and the pharmaceutical area. As demands shift towards a more socially distanced society, so will the overall market. As a result, different niches of business will successfully emerge. 

 

Citations:

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STAFF. “Netflix Gets 16 Million New Sign-Ups Thanks to Lockdown.” BBC News, BBC, 22 Apr. 2020, http://www.bbc.com/news/business-52376022.

STAFF. “Zoom Revenue and Usage Statistics (2020).” Business of Apps, 23 June 2020, http://www.businessofapps.com/data/zoom-statistics/.

Swartz, Jon. “Netflix May Have Edge on Competition as Coronavirus Keeps People Looking for New Shows.” MarketWatch, MarketWatch, 2 May 2020, http://www.marketwatch.com/story/netflix-in-the-age-of-covid-19-streaming-pioneer-may-have-new-edge-on-competition-2020-04-07.

Tucker, Hank. “Coronavirus Bankruptcy Tracker: These Major Companies Are Failing Amid The Shutdown.” Forbes, Forbes Magazine, 26 June 2020, forbes.com/sites/hanktucker/2020/05/03/coronavirus-bankruptcy-tracker-these-major-companies-are-failing-amid-the-shutdown/#294ceece3425.

Valinsky, Jordan. “Business Is Booming for These 14 Companies during the Coronavirus Pandemic.” CNN, Cable News Network, 7 May 2020, http://www.cnn.com/2020/05/07/business/companies-thriving-coronavirus-pandemic/index.html.

“Video Conferencing, Web Conferencing, Webinars, Screen Sharing.” Zoom Video, 2020, zoom.us/education.