Second Lockdown in the UK: Which sectors could do well

Summary

• Some companies have gained advantage during the pandemic, turning threats into opportunities
• A sudden surge has been observed in the online education sector and people are finding ways to alternatives of conventional teaching and learning
  • Business for supermarkets such the UK's Ocado and Tesco has been bolstered by the online delivery services being provided by them

The Covid-19 pandemic, followed by the lockdown imposed worldwide to control the spread of the coronavirus, turned the lives of a common man upside down. Before the pandemic struck, the global economy stood at $88 trillion. But due to the uncertainty around the pandemic, growth forecasts nosedived, and many economies went into recession.

Many businesses are facing an uncertain future today with economic activity coming to a halt. Most companies are facing the question of survival. However, the scenario is not the same for all companies. Some companies have gained advantage, turning threats into opportunities.

Let’s take a look at the sectors which have done well during the first lockdown in the UK:

Edtech and E-learning resources

The online education sector has seen a sudden surge as people are finding innovative ways of conventional teaching and learning. According to UNESCO data, as many as 1.37 billion students were studying and learning from home as of late March 2020. With the schools and educational institutions mostly closed, online education, tutoring, web courses, and others have gained traction.

Not only schoolchildren but most university students are also opting for online learning courses. E-learning is not only restricted to school and university students, but virtual workshop platforms have also come up to entertain and educate people. Cookery lessons, writing classes, and online drama workshops are the most popular courses in Britain.

In 2019, the edtech sector saw a high growth and investments reached a whopping €15.87 billion in 2019.

In Europe, London is a major edtech hub and one of the top cities in terms of attracting investment. Last year in Europe alone, London-based edtech companies raised a total of €105 million, which is much ahead of Paris, €78.4 million, and Berlin, €57.1 million.

Health and wellness

Health and wellness sector had a huge opportunity for growth during the lockdown and the period after that. People are looking to strengthen their immunity system and stay healthy and fit. In a survey, around 4.8 million Brits, or 9 per cent of the UK population, have said that health and wellness is ‘extremely important’ to them after Covid-19.

Most health trainers have utilized the opportunity and have migrated to online platforms for delivering classes of strength training and other exercises. This has also helped them to connect with the masses as online models helped them penetrate deeper.

Joe Wicks, British fitness instructor and TV personality, was quick on adapting the trend during lockdown, which resulted in hundreds of thousands of households tuning in for his child-friendly YouTube workout videos. 

A Barclays Corporate Banking research reveals that Covid-19 could lead to £21.1 billion in additional wellness-related business revenue across the UK hospitality and leisure sector by 2023.

People have increasingly turned to home fitness regimes to stay healthy as quarantines kept them indoors. Sales of home exercise equipment soared, sales of machines such as ellipticals and treadmills have nearly doubled, and online sales of yoga mats have also increased dramatically. According to BBC, UK department stores like John Lewis are observing huge upsurge in home gym equipment.

e-commerce and delivery-based services

People have been refrained from gathering up at markets, grocery stores and public places in most countries experiencing lockdowns. According to Digital Commerce 360, 36 per cent of consumers shopped online weekly since the rise of COVID-19, up from 28 per cent pre-pandemic. The pandemic is expected to have a boosting effect on the U.K.’s e-commerce market by adding £5.3 billion in sales in 2020, bringing the total market volume to £78.9 billion. Business for supermarkets such the UK's Ocado and Tesco has been bolstered by the online delivery services being provided by them. 

British homes were well-stocked throughout the crisis because of these supermarkets. With the cases rising again, it’s expected that the industry will grow in the same way.

Most of the UK’s restaurants and cafés facilitated takeaway orders so as to continue with their operations. Factors such as technological revolution and interface management systems have led to growth in this industry. 

People are using online ordered utilities and services for procuring their daily needs.

OTT platforms and online gaming

Restrictions and bans on movie theatres, gaming hubs and other recreational activities have led to a huge increase in the over-the-top (OTT) media and online gaming platforms. The main reason behind their popularity is that they are time and cost-efficient and provide a more personalised experience that too without moving out. 

A report has highlighted that the global over-the-top (OTT) market was around $110.1 billion in 2018 and would grow at a good pace to garner $438.5 billion by vvvv. Netflix, Amazon and Disney, best-known film streaming services in the world, have come a long way since their beginnings.

The existing gamers have been offered ample time to enhance their skills during the coronavirus pandemic, and the non-gamers have been bestowed with the opportunity to learn. Sales of video games have definitely risen. 

Healthcare

The healthcare sector comprising pharma, life sciences, and pathology segments is another major sector that has come out as a winner in the times of crisis. With the successful development of the vaccine, the current pharma industry is likely to be transformed in future. As companies race to find a vaccine against Covid-19, the pharmaceutical industry has been pumped with billions of dollars. The global crisis has illustrated the importance of the pharmaceuticals industry. 

Prices of many biotech companies’ stocks have jumped. The pandemic will prove to be profitable for those countries which have the ability of spending huge sums on healthcare equipment. 

In order to successfully recognise and treat patients suffering from this dreaded disease, the companies belonging to the health care sector have escalated the production of diagnostic tests and therapeutics.