During the year, 2020, the novel coronavirus (COVID-19) pandemic dramatically altered the way in which millions of Americans live their daily lives. While many hope for some aspects of pandemic life, such as travel restrictions and mask mandates, are temporary, other changes made last year are here to stay.
Working from home is bound to stick around for large segments of the workforce, digital security will only rise in importance, and the future of subscription services should be to continue to improve on consumer retention. Let’s explore how business during pandemic can continue to grow:
The Proliferation of Remote Work
Amidst the COVID-19 pandemic, 88% of companies around the globe either encouraged or required employees to work remotely. Of those companies, 67% expect remote working to become a permanent fixture of business operations.
Remote work has exposed unexpected cost savings to be had by both the firm and the employee. Firms save on property and overhead by holding fewer people in office buildings, and workers save on transportation expenses by forgoing a daily commute. Technologies such as Zoom and Microsoft Teams have become a lifeboat and incredible opportunity for so many.
In the long run, both firms and workers will migrate from higher cost markets like New York, San Francisco, and Washington DC to more affordable areas.
Between 14 and 23 million Americans are already expected to move, some living as much as four hours away from the company’s headquarters. In the coming years, that number has the potential to increase 3 or 4 times over.
While some companies do intend to cut the pay of workers living in more affordable areas, the worker is still likely to save money to the tune of anywhere from $2500 to $4000 a year. Location-based pay differences are a natural consequence of business during the pandemic, but they’re one in which the worker can still out ahead.
Even though remote work brings wonderful benefits, it offers no solution to several long standing inequalities present in the American workplace.
On the subject of more well known wage gaps, such as those based on gender and race, 2020 did not show significant gains for women or racial minorities. Though some predict that the prevalence of remote work will decrease hiring and management biases, women still make less than men when both are working in a remote position.
Furthermore, women and racial minorities are less likely to have the option of working from home in their jobs, meaning the cost savings discussed above will not apply to them. As with any new system, the shift to permanent remote work creates both winners and losers.
Cybersecurity Attacks Have Increased
Remote work has shown a compelling need for cybersecurity. The large scale growth of work-from-home technologies, customer-facing networks, and online cloud services have all been exploited by cyberattacks in the recent past.
Between February and March 2020, hacking and phishing activity increased by 37%. In March and April, over 192,000 coronavirus-related cyber attacks were reported each week, a 30% increase compared to pre-coronavirus numbers.
Three lessons can be learned from these alarming cyber-attack numbers in the post-pandemic world.
To start, a cyberattack could spread just as fast or faster than a biological virus, lying dormant in some servers for months at a time while it spreads. Furthermore, in an economy with ever-greater digitization, the economic impact of a digital shutdown could be immense.
If a digital virus had the same virulence as COVID-19, it could brick or wipe information off 20 million infected devices. Finally, recovering from digital destruction presents serious challenges as tech companies would struggle to meet demand surges in the aftermath of an attack, grinding other industries in the economy to a halt.
Our dependency on the internet is staggering: global loss of the internet would cost $50 billion per day.
Cybersecurity needs to be strong enough to prevent that from happening; in the case of a digital virus outbreak, cybersecurity experts are the frontline warriors. Right now, IoT and cloud email security are the places in need of attention.
Phishing remains the #1 vector in cyberattacks, serving often as the first step. For workers at home, reliance on public clouds increases risk of outages. On the side of IoT, 67% of enterprises have experienced a related security incident, many of which occurred due to out-of-the-box security flaws.
As long as these issues go unresolved, attacks will continue to use IoT as a point of entry.
Aligning OT and IT will do a great deal in improving cybersecurity.
In addition, businesses must reevaluate their security policies and procedures to reflect shifts to remote work. That means making changes to recovery plans, adjusting insurance coverage, and creating new policies for mobile security and devices brought into the business by an employee.
Logical next steps include increasing a company’s bandwidth to better handle teleconferencing, establishing secure VPN access for their employees, and requiring a network-level authentication for remote desktop protocols.
Cybersecurity is more necessary than ever before. Companies everywhere need to stay ahead of hackers in order to maintain business as usual.
Fixing the Holes in Your Recurring Payments
Both the changes discussed above think about how the way companies do work will change as a result of the pandemic. One final consideration is what kind of businesses will rise to prominence in the post-pandemic economy. While everyone was stuck at home, subscription services like on-demand streaming saw increased usage.
Companies who offer monthly subscription services are excited for and know their top line revenue numbers very well. The companies who will do well going forward take themselves to the next level by paying attention to what so many have come to ignore: existing customers.
In the US, customer churn (when consumers cancel their subscription) costs businesses $136 billion per year. A third of that number occurs due to involuntary churn and failed payments.
Companies who fix failed payments and keep their customers have the best chance of keeping customers long after pandemic concerns are alleviated.
When it comes to payment failure, the main causes of involuntary churn are insufficient funds, credit card limits, and credit card changes. While companies cannot see into every customer’s personal budget, the last issue of changed payment information is one they should be aware of.
This is especially an issue with auto-renew subscriptions. 35% of subscriptions automatically renew, but 47% of businesses lose auto-renewals due to change in payment data.
Not only do failed payments prevent companies from earning revenue, but they raise costs as well. 48% of businesses say chargeback rates cut into forecasted revenue, but 43% also say increased customer service contacts from failed payments make it cost more to keep customers.
Customer Loyalty is Key
Of course, it’s natural for businesses during the pandemic to pay for customer loyalty. 65% of a company’s business comes from customers it already has. Unfortunately, it’s easy to lose a customer; 32% of people will stop doing business with a brand/company after one bad experience.
Payment failures naturally lead to angry customers because they often only learn of the issue when their service stops.
How does one tackle the issue of failed payments? Automatic emails rarely help; they lack empathy, they put the onus on customers to take action, and they can’t replace customer service. Ways to decrease credit declines include direct debit, the use of digital wallets, and having a payment processor who accept a wide variety of card brands.
Personalization and applying logic to retrying a transaction can prevent failed payments from occurring in the first place.
Business During the Pandemic and Post-Pandemic Must Prevail
The year 2021 is primed to bring a lot of changes to the economy. Millions of people can work from anywhere, allowing both great opportunities and great risks.
The growing digitization of the economy gives more power to hackers and more potential for companies to forget the humans they have at the end of the line as customers. Despite great technological strides, computers can’t do it all in business.
Especially on the consumer facing side, it’s still necessary for companies to have people working to retain customers.
Brian Wallace is the Founder and of NowSourcing, an industry leading infographic design agency in Louisville, KY and Cincinnati, OH which works with companies ranging from startups to Fortune 500s. Brian runs #LinkedInLocal events, hosts the Next Action Podcast, and has been named a Google Small Business Advisor for 2016-present as well as the SXSW Advisory Board 2019-present. Follow Brian Wallace on LinkedIn as well as Twitter.