Author: Brent Messenger

Businesses must embrace the digital age to survive COVID-19

The coronavirus pandemic has triggered massive changes in consumer behavior. Demand for online grocery shopping has more than doubled. At-home fitness gear is flying off the virtual shelves. And e-commerce platforms of all types are recording unprecedented traffic. Online sales jumped about 50 percent in April following the beginning of shelter-in-place orders. 

In an attempt to return to normalcy, several states across the nation are lifting shelter-in-place orders and removing social distancing requirements. But things won’t ever be the same. The pandemic has profoundly altered the way we do business, and some of these behavioral changes are permanent. If businesses don’t prepare for this new digital reality, they won’t survive the pandemic or its aftermath. 

E-commerce has boomed since the outbreak began. Compared to their 2019 figures, retailers that have both brick-and-mortar and online presences reported a 52 percent increase in online sales between late-January and February, according to analytics firm Quantum Metric.

Much of this business comes from new customers. A recent survey found that more than 40 percent of people shopping online for groceries were doing so for the first time.

Hiring patterns reflect this new wave of online demand. Businesses nationwide have laid- off millions of Americans. Yet in March, Amazon and Walmart announced that they planned to hire a combined 250,000 additional workers to fulfill and deliver e-commerce orders. Macy’s recently stated that it would furlough most of its employees, but there would be “fewer furloughs in our digital business . . . so we can continue to serve our customers online.”

Of course, people are primarily transacting online because they can’t leave their homes, but these new customers won’t all disappear once the virus subsides. 

Consider the workout industry. The average gym membership costs nearly $700 per year in the United States. It’s far cheaper— and more convenient— to subscribe to a virtual fitness program and buy a set of weights.

Or consider meal delivery kits. Folks may initially sign up for Blue Apron or Hello Fresh to avoid visiting the supermarket, but some people will discover they enjoy cooking their own pre-packaged dinners and become lifelong subscribers.

Florida may reopen its beaches, Texas might allow residents back into restaurants, and Georgia may open up its gyms. But even with social distancing measures in place, there will still be untold numbers of people who are afraid to even leave their homes. Millions of high-risk people who suffer from chronic conditions will be particularly wary of venturing into busy stores and public places.

If businesses want to survive in the new reality, they’ll need to significantly expand their online presence.

My company, Fiverr, has worked quickly to adapt to the new ways that Americans are living and working. When the pandemic began, we opened several new categories on our website— including online coding classes and music lessons— to meet the demand for virtual assistance. Now, we’re working with businesses to help them digitally transform their offerings— whether that’s creating a website, helping with e-commerce, or optimizing social media channels.

We’re not alone. Shopify, an e-commerce company, is offering an extended 90-day free trial to new customers who are looking to take their retail stores online.

The coronavirus pandemic has ushered in a new digital-first age, one that’ll last long after the virus fades. Businesses of all sizes will have no choice but to adapt.

Brent Messenger is vice president of public policy and community engagement at Fiverr. This piece originally ran in the International Business Times.

We Need A Healthcare System That Supports The New American Workforce

Americans are increasingly leaving their traditional 9-to-5 jobs to work for themselves. Last year, nearly 57 million people performed freelance work — up from 53 million in 2014.

The Affordable Care Act made this transition possible for many. It enabled millions of Americans, including those with pre-existing conditions, to purchase health insurance independent of their employer. Consequently, Americans can work independently without worrying that medical emergencies could destroy their finances.

As the head of community at Fiverr, an online marketplace for independent work, I’ve seen first-hand how important affordable health care is for people to pursue freelancing. Yet policymakers have repeatedly tried to undermine the ACA. These efforts have caused premiums to increase, making coverage unfeasible for many.

Attacking the ACA further is a mistake. Instead, lawmakers should protect and strengthen the law. Independent work allows people to become their own bosses — and boosts the economy.

Consider this hypothetical — a small public relations firm occasionally needs to make some infographics. In past decades, that firm would have had to hire an in-house graphic designer. That’s expensive. And only designers within commuting distance could apply. But now, the firm can engage a freelancer — who could have many similar clients and earn a sizeable income. Indeed, in 2018, skilled freelancers in the top 25 markets for independent work generated over $135 billion in revenue.

Win-win scenarios like this help explain why freelancing contributes $1.4 trillion to the American economy annually.

Many Americans want to work independently but remain tethered to their employers for health benefits. Fifty-six percent of Americans cite health insurance as the reason they’ve stayed with their current employers.

The ACA sought to remove this barrier, and it largely succeeded — at least under President Obama. In 2013, the year before most ACA provisions went into effect, only 64 percent of full-time independent workers had health insurance. By 2016, that increased to 83 percent.

The ACA also spurred entrepreneurship. Consider a study from one Temple University researcher who analyzed the ACA provision that allowed young Americans to stay on their parents’ insurance until age 26. Young people who received that coverage capitalized on the security it provided. They were up to three times more likely to start their own businesses.

Yet some politicians have relentlessly attacked the ACA. In late 2017, Congress neutered the law’s individual mandate — the requirement that all Americans obtain insurance or pay a penalty. The Trump administration has also allowed insurers to sell lightly regulated plans that cover only some of the benefits included in standard ACA plans.

These politicians hope that, due to these reforms, young, healthy workers will forgo coverage or enroll in junk insurance plans. That would leave only older, sicker Americans in the ACA’s insurance exchanges. Premiums would surge, making plans unaffordable for millions of middle-class people who don’t receive subsidies.

Sadly, the efforts to undermine the law are working. Last year, exchange plan premiums rose 6 percent more than they would have absent this sabotage. The number of people enrolled in unsubsidized ACA plans plummeted from 6.3 million in 2016 to 3.8 million in 2018.

Politicians could promote entrepreneurship by restoring the individual mandate and taking steps to uncouple health insurance from employment. Such reforms are good policy and good politics. More than half of freelancers consider themselves politically active, compared to only a third of non-freelancers.

All Americans should be able to pursue independent work. Health coverage mustn’t stand in the way.