The Effects Of COVID-19 On Hyperlocal Services

When one takes a retrospective look back at the end of 2019, the future of the economy and consumer behavior looked to continue rising on a comfortable upward trend into the new decade. While online sales and direct shipping from companies such as Amazon were becoming more commonplace, consumers were still venturing out to brick-and-mortar stores and restaurants for a majority of their retail therapy and entertainment.

7 months into 2020, the world looks quite different. With the emergence of COVID-19, consumer lifestyles and expectations have experienced a seismic shift from the last months of the previous decade. With global shutdowns and a subsequent economic crash, behavior moved from venturing out to purchase with expendable income to buying only the essentials online. Suddenly, brands and companies faced a seemingly impossible uphill climb against buyer fear, team member safety, disrupted supply chains, and consumer behavior. 

In the wake of closed physical location and delayed shipping times, one industry has grasped the golden chain of opportunity - hyperlocal services.

COVID-19 & The Shattering Of The Status Quo

Unfortunately, the novel coronavirus - SARS-CoV-2 - needs no introduction. First emerging in late 2019 in the Wuhan province of China, the new strain of the common coronavirus family mutated to allow human-to-human transmission. In a globally-connected world, the virus hitched a first-class ticket on an airplane and the rest is history. 

In the span of a few short weeks, countries closed their borders and ordered businesses to cease operations in hopes of mitigating the spread of the virus. The sudden shutdowns and lockdown measures sent panic-stricken crowds to grocery stores and home supply retailers, wiping shelves clean of many common household products. 

The effects of this panic-buying were felt immediately, and the shockwaves traveled back to warehouses and manufacturers as supply suddenly crashed below demand. From the view of many analysts, the strain on the supply chain system due to COVID-19 was the worst since World War II

Rising From The Rubble - Hyperlocal Services Find New Life

As often happen in moments of crisis, innovation wins out over fear-induced paralysis. While major retailers and supply lines struggled to learn how to adapt their systems to an at-home civilization, one industry was primed for this moment - hyperlocal services

Hyperlocal services, simply defined, are services focused on consumers in a finely-tuned region or location. Common examples of popular hyperlocal services are GrubHub or DoorDash restaurant delivery services and InstaCart online grocery shopping. Instead of consumers traveling to brick-and-mortar locations to shop, purchases can be made with the click of a mobile phone application and are delivered within the hour by a local delivery driver. 

While consumer behavior surrounding online ordering had been rising in recent years, the effects of COVID-19 have given the industry new life. With millions staying home to avoid infection from the virus, individuals and families are now reliant on hyperlocal delivery systems to deliver necessary items to their doors in a safe way. 

What was once a novel way to order food for a working lunch, hyperlocal services have become the new way to receive food, essential products, and medicine. Even pet food and makeup are now being delivered through hyperlocal services. In the span of a few months, low-payed gig economy workers saw their jobs take on a new meaning as they took on the mantle of “essential workers”, with families even celebrating delivery drivers as they arrive at the door with food and supplies. 

A New Symbiotic Relationship - With Benefits? 

One of the unforeseen effects of COVID-19 on the economy has been the flipping of the competitive to cooperative. While hyperlocal services were once seen as competition to companies who fought for customer’s presence at their physical locations, many of those businesses are now relying on hyperlocal services to ensure their goods and services reach consumers. 

This new cooperation between hyperlocal services and established businesses has led to new questions regarding gig economy workers. Are these hyperlocal services now part of the regular business operations of a company? Should gig workers who offer services or these companies offer benefits and pay comparable to on-site employees? Will hyperlocal services maintain their autonomy from big business, or will they be consumed as companies move to an online-only model? 

The COVID-19 pandemic has brought hyperlocal services and gig economy workers into the spotlight. While there are still unknowns to be determined about hyperlocal services in the modern economy, one thing rings true: in the age of COVID-19 and beyond, hyperlocal services are here stay. The real question is whether companies will respond to this new economic reality - and how? 

The Future Of Hyperlocal Services

In the fog-of-war caused by the unknowns of COVID-19, the future of the economy remains shrouded in uncertainty. However, the outlook may not be that bleak for those willing to innovate. As history as shown, many of the greatest technological and economic advances were birthed from moments of global crisis. Perhaps COVID-19 is the catalyst that leads to the rise of direct-to-consumer service models that last.

With the number of large companies and brands that are making the shift toward D2C delivery models, the need for an intermediary is becoming less necessary. Products are now being carried directly to consumer’s doors and mailboxes through the services of an army of hyperlocal delivery men and women. As demand rises for hyperlocal services in communities around the world, those who have become unemployed due to the economic shift are now answering the call to deliver. 

It may be morbid to speak of success in a pandemic, but industries and small businesses are looking for ways to survive and thrive in the midst of this unexpected global crisis. Whether a company is global or still lives on Main Street, those who evolve to scale their operations to take advantage of hyperlocal services will likely see the greatest success from the pandemic. Not only will hyperlocal services help companies extend their reach and increase customer engagement, but consumers are looking for companies that are willing to meet their needs and protect their health through services tailored to them.

By partnering with hyperlocal services, businesses will continue to reach their faithful customers while providing new opportunities in the emerging post-pandemic economy.