The consequences of COVID-19 for businesses are mainly seen in negative terms. Industries have been damaged by the drop in consumer spending and lockdown restrictions. However, this was not the case for all industries. Among these Covid-boom industries are the plants and flower industry, skincare, and food-delivery services.
These three industries boomed during the pandemic and are expected to continue to grow in the next few years. A main factor of this is the generation aged 25-39, which Goldman Sachs say have the strongest purchasing power.
Plants and Flower Industry
The pandemic forced people to make drastic changes in their lives. Not being able to leave home was one of the main changes people had to deal with. To cope with this, people bought flowers and plants to make their homes and gardens nicer. During the pandemic many plant-selling businesses had to adapt themselves to the new situation to stay in businesses.
Those shops that had delivery option boomed, as was the case of California Tropicals, a family-run online plants business in Southern California. From 10-20 orders a day they reached 200 orders during the pandemic. Deliveries of plants grew at an unprecedented manner across the globe. In Germany, France, the UK, and the Netherlands a study revealed that approximately 1 in 5 consumers bought these products online for the first time.
Houseplants have risen in popularity especially among millennials, but why is this generation so keen on buying flowers and plants?
Firstly, millennials tend to start families later. With a higher percentage than ever opting not start a family at all. Whether it is because their financial position does not allow them, or because they prioritize their careers and hobbies such as travelling, this generation seems to take care of plants and pets rather than kids. Houseplants also contribute to our wellbeing, being for some an escape from the hustle of our daily routines.
Millennials spent twice as much on their gardens than the rest of the population during lockdown. Despite restrictions being eased, the amount of time spent at home is still relatively high compared to pre-covid levels. People have confessed that they will continue to follow this worldwide trend with the global flower and ornamental plants market expecting to grow at CAGR of 6.3% between 2019 and 2025.
The Skincare Industry
Skincare became a priority during the pandemic. 56% of consumers now focus more on skincare than they were before Covid. Whereas makeup sales collapsed during lockdown, skincare products sales doubled, according to the British department store John Lewis. In America it was the most bought beauty product across all age groups.
This powerful shift in consumer preferences illustrates the new trend: self-care is not selfish. Recent generations, such as millennials, have reshaped the beauty and personal care industry demanding products that hydrate, cleanse, and purify their skin.
Due to Covid, consumers are now more health conscious and demand better products and services for their bodies. For instance, a top product bought during the pandemic was the blue-light blocking skincare, whose goal is to keep pores protected from the impact of screen time in our skin.
According to L’Oréal’s Active Cosmetics report, skincare sales propelled in 2020, with a growth in sales of 18.9% compared to the previous year. The skincare segment is expected to growth as the years progress. In the UK the market is projected to expand at a CAGR of 5.2% during 2019 and 2024. Globally this market is forecasted to grow at a CAGR of 4.8 from 2021 to 2028.
Food Delivery Services
The food-delivery industry flourished during the pandemic as the world faced mobility restrictions. The ordering of food online increased as restaurants shut their doors and people tried to recreate the experience of going out by ordering the same meals they once did.
The presence of millennials in this industry is significant as the chances of them ordering food for delivery are three times higher than previous generations. Millenials are also the largest generational group in many countries including the US, Brazil and India.
During the pandemic, 20% of this generation is said to have increased their ordering delivery. Millennials and Gen Z, the generation following millennials, are the main users of this service that combines the comfort of home delivery with restaurant food.
Although much of the world is no longer in lockdown, this industry will continue to expand and grow. The global food delivery market is projected to grow at a rate of 11% from 2021 to 2025. Possible reasons are the comfort of these services, people´s preferences to stay at home due to Covid concerns or, regarding millennials, the lack of time to cook as they work on average 4.2 more hours than non-millennials.
As seen, the role of this generation in helping certain industries mitigate the impact of covid-19 is worth-noticing. Millennials have great purchasing power, power to shape industries and are one of the largest groups in some countries which makes them a key consumer in all industries.