The new Low Touch Economy: shifts in consumer behavior + opportunities (Covid-19 Webinar)

Hello everyone. We're gonna kick off. Welcome everyone. I saw people joining from El Salvador to the Philippines. So good morning, good afternoon and good evening to everyone. It's lovely that you're joining us on this webinar on shifts in the low touch economy. Everyone was already introducing themselves. Please keep on doing that in the chat, including your name, location and some unexpected change that you noticed caused by Covid during this talk as well. We will have several moments of interaction in the chat and with Pauline as well. So before we kick off, I want to introduce you to your two hosts for today. I'm here joined by a co founder Nick, who's obviously partner at the company and the creative brain and a designer by trade and myself, CEO of the company currently and an economist by trade. So we founded Board of innovation in 2008 actually amidst the previous crisis and our lifetime mission is that we want to inspire 100 million people to innovate for a better tomorrow. And that is also why we open source all of our knowledge and all of our tools on our website. So everything that you will see in here will be shared with you and is download. Well, what we do on a day to day basis is we work with our Fortune 500 clients across all continents shaping growth strategies as well as actually building new businesses from those. Now we got that out of the way, what do we have in store for you in the next 45 minutes? I'm going to give you a quick introduction to what we call the low touch economy. Nick is going to unpack some short and longer term impacts of that and then most importantly for me, we're going to offer you a hands on framework to create an actionable strategy for your business or at least a starting point for that. And then at the end we're going to wrap up with a Q and A session. So please during the presentation as well feel free to share your questions in the chat as Nick will be gathering them and we will answer as many as possible at the end of this presentation. So let's get going. Our point of view is that any viable exit strategy from current lockdowns in which about half of the world's population is in at the moment, will rely on building a low touch economy. A low touch version of the day to day interactions that we have with products, services, other people, children going to school and so on. The sooner we succeed in building that low touch version of that, the sooner we will viably be able to exit concurrent confident strategies. What is the basic feedback loop of the low touch economy? It Obviously all starts with the current pandemic and the health measures that are brought to life to control the current pandemic. That's the origin of the whole cycle. And that leads to a number of economic disruptions both at macro and micro level, and a large number of behavioral shifts amongst consumers in terms of how people interact with each other and change how they interact with businesses, products and services. Again now because of this feedback loop, that means that the longer those health measures, sustainability, the longer the economic disruption and behavioral shifts sustain as well. So if this was a one month thing, then people would probably get back to their old normal quite soon. But because of habit formation, if people Repeat on average 21 times a certain behavior, they would sustain it as a habit after that as well. And that is why this is going to be so disruptive to certain buying behaviors and consumer behaviors in general as well. So what most people hope to see is that we could get out of the current confinement policies after a couple of weeks. Let's say what we're looking at here is what we call the first order low touch characteristics, including social distancing, number of hygiene, precautions like hand washing disinfections, travel restrictions, and the limitation of large gatherings under which most of the current confinement policies resort under those four. So this is what we're all hoping to see. This is our base case scenario. So going back to a new normal, which will be a much bumpier path until we are able to reach herd immunity or a vaccine in probably 18 months from now, which would still be a lot faster than the fastest ever developed vaccine, which was four years if I'm not mistaken. And in between we will see an up and downwards movement of control the pandemic, and an up and downward movement of these low touch measurements, hopefully not in the current lockdown measures, but least up and down swings. That means all the second order changes, as we've outlined in the feedback loop in terms of economic disruption as well as on behavioral shifts in how we live and work, will sustain as well. That's the basic premises of the low touch economy. Why are we looking at the base case scenario of up and down swings for the next 18 months? There's a plenitude of studies who are also contradicting each other. So signals are obviously mixed with. But if you look at some leading studies, obviously you had the one here on the right side of Imperial College saying that we would be for two thirds of our time for the coming 18 months in lockdown procedures. Obviously that study has been criticized and is on the extreme side of things. But also Harvard published their study on that about a week ago and they were also looking at not returning to normal before 2022 or even their worst case scenario was to 2024. If we don't succeed in getting that vaccine sooner on a mass scale, one point is looking at the studies, the other one is looking at what countries.

Are doing who are a bit more.

Further on the curve than most others. So if we're looking at China for example, where they are returning to a normal, it's not going back to the old normal. Here you see graphs of what percentage it returns to the 100% pre corona and you see that for example container freight is 69% box in terms is just still flat at zero. So if you look at some of those countries, it's not returning to the old normal, but it's returning to a new normal. For example, Chinese cinemas, they were told to close just a week after they reopened. And we see big lockdowns being replaced by dozens of changes to daily life, meaning for example excessive cleaning operations. We see apartment buildings being cleaned 25 times a day, restricted access to a lot of buildings, health and security checks everywhere. So that's going to be the low touch new normal that we're going to be in for an extensive period of time. So we should prepare for that as well as for several years of aftershocks most likely. So at the bottom here you see exemplary aftershocks. Obviously the first one that we are already in is the one of mass unemployment. So in the US up to 10% and more now of the active population in some European, we're looking at 20 to 30% or even more mostly in temporary unemployment measures as they exist across continental Europe and obviously which might lead to cycles of bankruptcies, credit defaults and so on. So other potential aftershocks being rise of nationalism. We already see democracies being slightly hollowed out like in Hungary. The Euro, as in all crisis is coming under pressure and a lot of them we might not see coming yet. So on that I want to open up the chat as well and interact and learn from each other as well. So which other aftershocks are you expecting in the coming year or two years? So I invite you all to open up the chat and share with us which aftershocks you are expecting in the low touch economy. I'm going to open up the chat here as well. Political instability. I'm reading new definition of globalization. Yes, most likely with much more localization as well. Although I personally wouldn't Overestimate the effect of that as well. Wearing masks all the time.

Yes.

On a rather slow adoption curve in most western economies or countries. Chaos in low development countries. That's an interesting one. Where developed economies have the monetary power, basically sustainment policies for a longer time through temporary unemployment, giving loans to companies. A lot of less developed economies don't have that bandwidth. So that might indeed lead to more chaos. The role divided by immunized people versus not. That's a very, very good one as well. And at the moment, so we're seeing the first studies coming out in continental Europe, for example, about 4% of the population is immune at the moment. So it's still quite a small portion which will obviously be growing throughout the year, but still relatively small now to cater to a lot of stress and mental issues. Indeed, we see those numbers going up in terms of mental disorders as well as substance abuse going up to two, up to three times depending on the country. All right, keep them coming and obviously be inspired by each other as well. Now we're going to move to the next topic, which is unpacking some of the shorter and long term consumer impacts. And I'm going to hand over the.

Floor to my colleague Nick Furniture for that.

Okay, great. So a couple of shifts and what's happening, what might stick? Let me see if I can control the slide.

One second.

Yes, so there are a lot of shifts happening. Of course there are changes in geopolitics, change in regulation, changes in technology and so on. We try to track as many of those domains as possible to see what's now happening in the world, what will change, what will stay. We focus for now, most focus mainly now on the changes in human behavior as a starting point because we assume that if people behave differently, it will also have ripple effects on the other domains. So there's also in this deck, you will see we'll start from human behavior, but doesn't mean that we don't need to track those other things as well. That's why we already talk about some changes in geopolitics and macroeconomics and so on. If you look at this graph, this is not a graph about a virus or something. This is a graph about adoption curves of products. Meaning if you look at new technologies and how products are being adopted in the market, typically it takes years before a significant part of the population is using a product. Decades ago it could take years before a product had a reasonable adoption. But if you look at the trend there, if you look at the recent years due to the connectivity of information and countries are being connected, consumers are more connected. You see a quicker adoption, you see a quicker adoption of those products. So it takes less time before a product becomes widely adopted in society. So that's already an ongoing change. And basically what we now see is that due to this crisis, many products or services are getting now a steeper curve, meaning those products are being adopted a lot faster now because you take away certain hurdles or you push a big segment of your population into a new need, and suddenly they need new products. So we see that a lot of products and services are now changing or basically are accelerating how they're being adopted. It's not that we see a lot of new products or services being adopted. There are, of course, some. But the biggest changes, the biggest shifts are happening because many products and services, we're suddenly accelerating a lot. So we start from there. To give an example, a product that is our service, that's already a little bit more mature. So, meaning it's later on, this adoption curve would be e commerce. I think it's an example that we all can recognize. If you look at numbers from the states, then you would see that still 1 in 3 people never bought something online. So that's still a large part of the population that was not just not involved in e shopping during the pandemic. In a matter of weeks already, one in four of those people now started using some form of e commerce or started to shop online. They will, of course, a large part of that group will recognize the convenience of it. It will create a new habit, it will try more services later on. So many of those people will stick to this habit and keep on using those products and services. Another products or a service that is way lower on this curve would be remote therapy or etherapy. It's a combination of having people in these lockdowns. People are stressed, they're getting unemployed, increasing unemployment rates, the economy is crashing. In many ways, people are rather anxious. So there's a need for more therapy on one end. And then you see that doctors are not able to visit those people anymore. So there are a lot of products and services that are now tailored to those needs. It's not totally new. There was, of course, a first niche of users that was already using etherapy, but it was rather low in this curve. And suddenly now a bigger part of population will suddenly start to use those products and services. What's important here, it's not just a matter of patients and consumers, our doctors and patients interacting also. The backend now quickly evolves so there are changes in regulation to make it.

Possible.

To work together with your insurer. So that's also IT systems are being upgraded. Those were bottlenecks and reasons why the adoption was quite low. And now those bottlenecks are gone. It will of course keep it more or less stay on the same level also later on people will recognize the value of it and many people keep on using those type of products, products. So again, this product is a lot. The adoption curve is a lot steeper then we assume there. There will be some new habits and some new ideas that will be adopted in the market. But we start almost from zero. So one example here would be Universal Basic Income. It's an idea or a concept that's been tried before in a couple of cities or more local experiments, but it was not really broadly supported. Now due to the economic pressure on the economy and all changes, you see that many states, including Spain, are now exploring the potential of this. So it could be a new. Could get a better adoption rate suddenly that could actually trigger the uptake of Universal Basic income. Second thing more linked to rituals, how we interact with each other. A lot of rituals linked to hygiene and those things. So shaking hands might be something that we won't do anymore because people are afraid to make somebody else sick or for their own safety. So there's a lot of. There's a push of course to avoid this and if people stop doing that now for months, it might have a lasting effect later on. So also if you spot certain changes, if you see something happening in your region, we're also feel free to send that as well. We're happy to capture that. There will of course be winners and losers in the market. Companies are better at capturing new needs. So if you would look at this graph where there's demand could be rather high for new products and services, or low and could have a temporary effect to the left or it could be a lasting effect. So very simply, if you look at the left side, there are products where suddenly demand is rising, like DIY haircuts or people are looking for sewing tutorials because they want to sew their own masks, oatmeal, those things. The opposite side, there's less demand for car accessories because people of course are not driving anymore. Camping gear, golf clubs, again is in decline. But many of those examples, you see them popping up in infographics, in news articles, is just part of the ongoing crisis. It doesn't mean that those things will stay afterwards. We can expect that certain of those products are just now under pressure and as soon as we open up the economy again quickly, it will rise again. So that's our main. The biggest part of our research now is focused on that second part to really understand which type of products or services are in decline. Like in this case, sunglasses, eyeglasses, currently in decline, but are also the reasons why maybe later on people start buying even more. Probably come back to that later. So on the right side, we want to understand which products and services have the potential to stick. Afterwards I mentioned okay, you need to understand what are good reasons or triggers why certain behavior would stay. So if you observe a change and you notice that there was friction before, there were big hurdles before, but it was in terms of it or regulation or certain policies, but suddenly those things changed is a very good reason that they won't reintroduce those hurdles later on. So that's a good reason to assume that many of those things can stay. Like in the context of E Health, many of the hurdles were linked to regulation and loss. But just a matter of weeks they updated those. We don't expect that many of those laws or regulation will now be reverted once the lockdowns are over everywhere. So that creates a lot of freedom, new opportunities to create new products and services to capture even more demand in that space. Second cluster, if you look at investments of people or even companies, if you look at just people are at home for a very long time, people are buying extra equipment, whether it's for entertainment, there is even an increase in swimming pools, people investing in home entertainment systems, people buy a lot of new appliances or sometimes people are even renovating their house to be able to work with multiple people and at the same time having kids around. So people make changes, they invest to spend time and money on that. Once the economy is catching up again, they will probably stick to some of those habits or that opportunity because they have new appliances in house, they probably use that. If they invest in personal gym equipment, they might not go back to the regular gym. So that could be a good reason. A last topic here, link to communities. If we if you see that people are in group behaving differently, people might want to stick with that community and they don't want to change as one outlier that is dropping that part. Important to note here is that a wish is not a prediction. So it might be that your personal belief or that you want to see certain change. There's a lot of links to climate change. We see that pollution is dropping. So there are a lot of advocates that say can we make now is the time that actually people will start to tackle climate change. The reasons why we see the benefits now in terms of pollution and other things, late countries were not linked to that. People want to change anything here. It was for very different reasons. So as soon as the economy will start again, we probably will see again the same downsides of that and the same thing with virtual reality. There were big hurdles why it was not a significant update. Whether it was investment costs or content or. There were a lot of reasons why VR was not yet widely adopted and those things again didn't really change due to the crisis. So even if you're advocating as a technologist that we should do this, this didn't really change and probably will not see a big uptick. We try to capture as many of those ripple effects or changes. So if you go to theloadtoucheconomy.com there's also a link to Mind Map where we capture all those ripple effects. And we also have a Slack community that, that you can join. Give you the link at the end and we discuss what potential ripple effects that we will see in the market. As an example linked to in the context of hygiene theater, to make it more concrete today, you see in certain regions in India where they're flying around with drones to disinfect the streets, this is more about signaling and showing that they care about hygiene than actually that's a real functional thing, that it actually matters. But of course it's important that people feel safe. The same way of thinking will probably applied now to new products and services where we expect communication like human free fulfillment or automated supply chains where they will talk about how few people were involved, how safe it is, but almost over the top. So that's why we call it hygiene theater. So in this area we'll see a lot of changes and you can probably spot them in the next few months. There will be a lot of.

Change.

Here as an example, personal identity reshuffle. People are mixing different identities. I'm broadcasting as well from home. So people see a mix of professional life, personal life. There's a mix between online and digital that's suddenly accelerating. So people have multiple heads and suddenly they can't see the barriers anymore or where the differences are. So people need to understand what actually what that would mean in their personal life. And, and here we can see that it will have an impact on related products. So if you're in the fashion industry, luxury business, anything that links to personal reputation and branding of people will be affected by this. Some products will have less demand, other Products, of course, will have more demand. And here we can learn a lot what's happening already in a digital space. If you look at streamers and gamers and people in that space, they already trade virtual items. They have another way to identify themselves and they're paying for that. So elements that are starting in that area of digital streaming will be transferred to a more B2B context. So it's an interesting area to follow. And there are many topics where you see very mixed signals. Just one example here. In the context of mobility, you could say that there will be even more demand for, let's say shared vehicles or shared scooters because people want to avoid public transport, which might be very crowded. At the same time, they might not feel safe to know who else used this product before. Is this car safe to use? So we see mixed signals and that's.

Of course interesting to follow.

What are the underlying drivers to spot what will stay in which context, in which culture and so on. We try to do this for as many industries as possible to keep an eye on what's happening. We try to see what's happening due to the hygiene restrictions. People are also affected by the economy or if the need is not urgent today, like people are not buying cars today because it's postponable, you don't need a car today, it's quite expensive. Then it might even postpone expenses one year in or something. So it has a different effect on different industry. If you want us to focus on one specific industry at some point, feel free to drop that in the comments already. Like which area is more relevant to you? Should we highlight certain industries? There will be updated reports later on. And also in the Slack community, we'll start a couple of dedicated channels on certain industries so you can join with others to talk about the changes that are happening in that specific space. So that was just a quick update and then Philip can take over.

All right, thank you, Nick. So as a last part, we're going to look at creating actionable strategies and how to get started with that. Of course, any strategy starts with scenario planning. Is it a six months or is it an 18 months problem that you are solving? How is it impacting your different business lines, your different categories and your different geographies? What if Harvard scenario of returning back to normal only in 2022 pans out? What do we do in that case? So to kick off that scenario planning, we've made a high level framework for you to look at, which on the one hand looks at the severity and the duration of the economic impact which is influenced by how successful we can control the current pandemic and secondly how successful we are in terms of the economic policy, in terms of monetary and fiscal stimulus. And obviously you can track any type of GDP forecast and other numbers out there. Distilling three high level scenarios there. One is a V curve rebound of a half year impact where we effectively control the pandemic and economic stimulus eases the economic damage of that a one and a half year impact or a U curve recovery. And thirdly, a three year impact or an L curve recovery where we fail to control the pandemic. And also economic policies fall short leading to widespread bankruptcies and credit defaults. Then looking at the second aspect which is the impact on your organization and that is the direct impact of COVID 19 because of travel restrictions, low touch behaviors and so on. Or the indirect impact of the economic recession that comes because of that. As a third influential factor we see the ability to adapt fast, which basically counters for the previous two. The faster you are in changing to a new vertical, a new product offering, a new consumer channel, for example. Obviously you can counter the previous effects. So we distill four categories ranging from positive to catastrophic. Positive meaning revenue growth through a demand surge which we're currently seeing in E Commerce. A mildly negative scenario where your sustained revenue loss for the remainder of the year is between 0 and 15%. And then a severe scenario where that is up to 50% like we're seeing in some industries like oil and gas. And then catastrophic is a sustained revenue loss of over 50% for the remainder of the year which we're expecting in tourism and hospitality. Now before we dive a bit deeper into that, I want to open up the poll to you as well to indicate like in which scenario you are at the moment positive, mildly negative, severe or catastrophic. So the results are coming in.

About it, although it's anonymous. All right. Already 60% voted. We are completely maxed out by the way, with 502 participants. All right, I think we can close it with about 70% of people voted. So just above 10% is in a positive scenario. Most people are in either mildly negative or severe. So 44% are mildly negative, severe, around 34% sorry. And then catastrophic. 10% of the people in this call. So thanks for sharing that. Now our expectation is that most organizations will not be able to push through this crisis as they did in 2008. So rewinding 2008 global financial crisis. So it started in the financial sector and then led to the impact in the real economy. This crisis, the global pandemic crisis, is fundamentally different because it starts from the pandemic and it intervenes directly in the real economy and into the lives of over half of the world's population at the moment. So it's going to lead to a lot more changes in industries and offer a lot more opportunities as well as where industries and categories who were fairly stable are now up in the air basically for category changes. And the 2008 strategies were mostly on controlling the cost structure and waiting it out as there were no fundamental issues in terms of behaviors or shifts in that. Now we are not expecting that strategy to be the most viable one. We will see a lot more winning strategies is our expectation, which focus on innovation, spotting the new white space opportunities, acting on them, M and A maneuvers and so on. So having said that, how does that look like? If we complete the framework for each of the scenarios, it leads to a strategic starting point, giving a couple of examples to illustrate companies that we all know zoom obviously experiencing a positive revenue growth at the moment. And now as just the base case, we're taking the V curve just to compare scenarios to each other. So then the strategy starts from riding the wave, trying to boost supply to keep up with demand surge. And obviously those companies are often struggling with keeping up with the demand, in this case with the security issues. But it's the bad to have, let's say. Secondly, if we look at consumer goods companies typically like Ray Ban Nick already shared that on the short term there was a 43% decline in terms of sunglass purchases or revenues. We expect that to pick up again in Q2, Q3, Q3, Q4 sorry. So we end up at the mildly negative scenario for this type of content companies. Here the strategy is on pushing through and preparing for a fast back to normal upswing again if we are in a weaker scenario. Third example, if we move to the catastrophic end of the spectrum and looking at tourism or airline companies in this case like klm, the strategy is more on mobiling large parts of the business and preparing for restart, which we see most airline companies doing, furloughing their staff or have them go on temporary unemployment in countries where available, getting state support and hoping for a restart as soon as possible. If you look at one other example of a U curve recovery and a mighty negative scenario in which a lot of insurance companies might be in, it's a more diverse strategy of trying to defend the core business, improving competitive positioning in some segments and especially trying to tap into new growth areas. For example which new insurance products will arise from the current pandemic, Maybe directly related to the current pandemic, or maybe because of the bigger appetite for people to insure themselves against unexpected events. Although you can obviously argue that the pandemic was certainly to be expected if you plot the previous one, like sars, MERS and a lot of experts saying that this is, this was bound to come. A very important note, it's obviously not as simple of just plotting in two boxes and you end up with a strategy. This is a high level overview which is defined and which we are obviously doing in our client work across different business lines, across different geographies. And obviously it's very much also dependent on at least three other key key aspects, which is financial strength, your strategic response will be different depending on your cash flow position and financial strength compared to competitors, your competitive positioning in general and the industry attractivity as well. If you were to plot this on your portfolio of businesses and decide on where to reallocate resources, where to invest, where to divest, potentially if we look at most strategies for industries and companies who are more severely or catastrophically impacted by the current crisis, a lot of them involve on trying to pivot. So we want to look at a couple of examples of companies that are already pivoting and we will share more on that by the way in the coming days as well in follow up reporting. So first example is Home sweet Home. So this was a pivot from an agency that previously catered to hotels, which is obviously dead flat at the moment. They pivoted to providing a hotel experience for citizens staying at home. So they will deliver you a meal in the evening, a live comedy performance obviously streamed to you virtually a breakfast morning, a full hotel experience in the comfort of your own home. As we look at those pivots, we're trying to distill patterns out of that. In this case, the pattern being it's a change of channel and a change of customer going from hotels directly to consumers. So it's basically a pivot to direct to consumer, which is a pattern that we see coming back across industries as well. A second example is Openable, which is a well known restaurant booking app. Again in a vertical that is dead flat. They pivoted to bookings for retail visits. So a category where there's a lot of new needs coming up as due to social distancing, retail shops don't want or can't have a lot of people in the same space. So through OpenTable you can now book your appointment to visit the grocery store to avoid long waiting lines as well. The pattern here is a change of vertical from one being dead flat to another one where there are new demands. Third example is from Dyson Household Appliances company. They answer to the UK government's question to start producing ventilators. So they impressively designed a new ventilator which you see Here in only 10 days of time and started producing them. Whilst this is obviously helping out in the current health crisis, it might also be a segue into a new industry for them. Potentially they might stay in the medical equipment business and build out that vertical in a longer time frame as well. Last example is from an events production company in the uk. They pivoted over the again events being dead flat to the production of online learning. Whilst that might seem quite unrelated, it is still using their core assets, their core assets of being in video production which they leveraged in events, which they are now leveraging in a new vertical of online learning where there is an increasing obviously demand for good video productions. So for examples of pivots we are also keeping a list of those, a public list which is accessible via Google Sheet which we will share with you and as well if you want to contribute to that, you can do that directly in the Google Sheet or in the Slack community that we have on mapping out the shifts and understanding the new low touch economy. I want to ask you again to open up the chat. We won't go through the answers together, but just to inspire each other as well. Which other smart business pivots have you seen already that companies are doing? So please share your examples in the chat so we can also add them to the public list in the Google Sheet. Thanks a lot for sharing them and inspiring each other as well. So with those pivots we also want to invite you to switch from defence to offence where obviously defence is super important in terms of crisis. Protecting the health and safety of your employees and customers, protecting your Runway and controlling the costs and the scenario planning around that. The offense, especially now in the second phase of crisis management, is equally important. We have seen numerous examples of previous recessions where for example Sanofi in the 2000s recession invested a lot more in R and D than their peers and outperformed their peers coming out of the recession on the other end of it. Also acquiring Aventis for example, which previously was a much larger concern. Alibaba in the SARS crisis in China in 2002, that was a pivotal moment on which they reacted very fast, was a pivotal moment for them to become the E Commerce conglomerate, which they are today. So those are some exemplary or anecdotal effects. There's also numerous research around this of which we gather three here illustrating or underpinning the fact that companies that invest in innovation and new growth opportunities in downtimes clearly outperform others at the other end of the recession. So to summarize, in the low touch economy we believe that Covid will not go away fast, but opportunities might. So that for us is the why to act now and move ahead. Not just play defense, but also look at the offense. Summarizing as a whole, the low touch economy is here to stay. Nick unpacked some shifts and trends that we are seeing and are expecting and obviously in the report and other documentation there is more information around that as we can't capture everything in this 45 minute talk. We looked at how to scenario plan your strategic response across different businesses and we wanted to invite you to go on offense, look at the white space opportunities that are out there in industries that are completely flipped around and not just look at defense. So that wraps it up for today. Now I'm very happy to look at the questions that you are sharing in the chat and answer a couple of them. I already took note on a question as new questions come in that somebody asked earlier saying we're seeing contradictory research, for example in Brazil between the desire and the fear, people saying I desire to go out on a restaurant. But at the same time research shows that people fear to go on restaurants. So which behavior will we see? It's indeed true that we see mixed signals there. If you just look at the data, for example in China there, there's still a lot of fear. So lockdowns have been lifted. But people, the restaurants are not full so it takes time for people to get back to it. And so far it's unproven that actually they will get back to it soon. So that's data that we're seeing from China. And then looking at this from a broader perspective, I think nobody can actually predict the future. We can also only prepare for it. So the way we always look at strategies and moves to make is to identify multiple possible futures and to create a strategy on what you would do in that possible future. What would you do if Harvard's prediction was right? What would you do in another scenario? Let's see if there's more coming in. I'm also going to open up while.

You'Re reading some of the questions. I can already share the link to get on the slack so I'll drop it in the here in the chat, in between. So mephile, can you go one slide further so people can also read it there? So you see the link also there. If you want to continue discussion, ask us more questions. You're free to join that slack once you're in that slack. We started earlier this week, but still there are I think more than 500 people already in that group. So feel free to introduce yourself. And when you introduce yourself, please add an extra comment like what changed in your life recently that you think might stick later on? So maybe other people can already learn what's happening in your culture or your country. Coming back to some of those questions was one of the questions linked to why suddenly there's so much traffic already in Asia, where people are loosening some of the restrictions and suddenly we see a big spike already in traffic jams. So far the feedback seems to be that many people are concerned to go on public transport in crowded spaces, so they actually prefer to travel on their own in a car, which is what feels more safe. So even when still a lot of people are working remotely, people that are on the street are preferring more cars over trains and buses and those things. So actually that's like I said, like in terms of climate change and those things, people see the benefits of that, but actually the drift, the driving force was not to protect climate some way, but it was more to feel safe on an individual level. So let me see also a couple of other questions.

Yes, things coming in. For example, the last one, the future of Korea. I think Korea is a lightning example of how to manage the crisis. It's a continuous fight of course, but I think in terms of all countries they were the best prepared, having managed the starch crisis before and only updated their pandemic control guidebook in December of last year. So they were fully ready to roll out like the massive testing and tracking and tracing which they implemented with drive throughs where you get test results in just minutes and so on. So definitely one of the examples to look at for other countries to adopt. How do you think this crisis will affect M and A activity, specifically in Europe? I think in general, obviously we will see a lot of organizations and assets being in distress and M and A activity regarding that is definitely to be expected. In general, obviously we expect big tech companies to definitely increase their power, having a lot of cash available and as well driving through the current crisis as well and all the switch to E commerce and so on, the obvious shifts which you see happening. Any other questions coming in?

Very open question on expectation for tourism, we can assume that travel bans and even the rise in nationalism, there will be a push to close borders for longer time. Even so, probably anything linked to tourism will be focused on creating new type of experience, local experiences. So local travel. So you can expect a boom in anything that supports that. Camper cars, hotels, rebranding themselves as a local, the best place to go local or something more individual solo traveling as well. So if people want to avoid big crowds like going on their own or with a small family, back to nature instead of doing going to a very crowded hotel space. So there's a lot of stuff moving in that area that's interesting to follow, but unfortunately I don't think there will be a very quick recovery. It will probably be one of the last things to support. What's interesting to see is that certain nations now are exporting. Certain nations rely strongly on the economy of tourism. So they're trying to find solutions where they restrict people for only from a certain segment or only from a nation that has a proven track record to have low infection rates or something. So people that are immune or are less risk or less risky, they are still allowed to come into that country. So we'll see what experiment works in which country. And probably if something works, other nations or other regions might copy the same principles.

I'll take one last question and then I think in terms of time we need to wrap up. So someone asked what will be the impact on health clubs or fitness clubs as they have been growing very rapidly over the last decade? I think that is one of those examples where people, as Nick shared, are now investing in equipment at home to stay fit at home with all types of equipment like Peloton and so on, with virtual trainings as well offered by Headspace and other apps moving into that space. So I think that's one of those examples where people will adopt behaviors and have infrastructure, have made investments to do it at home. So expecting a decline there for people to still go out and not use the investments that they have made. Obviously not like a black and white story, but expecting a longer term impact of that. So pivots there might be if you're in like a health or a fitness club, maybe locally, can you rent out equipment to people now? So you also play a role in the staying at home part now, or can you offer virtual classes and so on? That are obviously the obvious things to look at right now. So I want to wrap up here. Thank you so much for being with us for participating as well. We will share with you the slack in which you can participate and ask all remaining questions that you still have. But for now.