Business models coming out of Covid-19

Many children’s activity providers facing up to the likely pause on in person activities, pivoted quickly to an online offering and while interest appears to have generally wained, some are still seeing new sign ups with the likelihood of many providers holding off on returning to normal activities services until further guidance and approval to do so from government, councils, schools etc.

Looking at the immediate future we can see there will be three popular models utilised by providers; in person activities only, online only and a hybrid/combination approach.

Exclusively in person activities

Some activity providers have struggled to adapt their services for online purposes such as swimming providers, sports clubs and other physical/outdoor education type services. Others have adapted but simply haven’t found the demand as strong for online and therefore will be keen to return swiftly to in person classes and clubs.

We expect there will be strong latent demand for classes to resume as normal with data and feedback suggesting that online fatigue for parents and children has occurred. This coupled with the clear and obvious need for children to be with their friends, physically active and mentally stimulated by the outside world suggests this model will continue to perform well once providers have made their settings Covid-Secure and of course when Covid-19 passes.

Exclusively online activities

While data suggests interest has decreased since the beginning of lockdown, the appeal as a business model for online class delivery is clear. Low overheads and easier to scale means this will provide many activity professionals with a question of whether they should consider online only offerings.

This opportunity presents both an opportunity and a risk. The risk that the activity provider doesn’t return to venues and subsequently loses customers and market share is very real, but the opportunity to pick up a new type of customer, potentially across the country (or world) logging in and joining online classes is equally high.

Hybrid/combination approach

It appears likely that in the short-term at least we will see some providers offering a timetable of activities both online and in person to cater for all needs, and to safeguard against the sudden need to move to online only again. This could be complimenting one another under one type of product, or it could be as separate revenue streams.

The question we feel this poses is – is the activity provider willing to take a risk on stepping outside the ‘norms’ of the industry and seeking in some ways to innovate? Some were already doing this successfully through apps and other digital touch points to compliment their services. Will other activity providers consider this approach too in order to strengthen any perceived weaknesses in their business?

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