Twenty years ago on 10 March, the dot-com bubble burst. That morning, the ballooning value of nascent digital companies in the brave new world of the internet suddenly collapsed.
Two decades to the day later and the world’s stock markets again went into a death spiral – this time because of the spread of virus that looked set to push many people to have to stay home for anything up to two or more weeks.
While it is easy to think that nothing much has changed in the intervening years – stock market crashes happen in a cyclical way and we always live to fight another day – what marks 2020 out as special is that now the digital economy may just be what saves us.
Closing offices and keeping people self-isolated would have been unthinkable in 2000, but today we have the technology to easily work from home. More importantly, it also allows us to shop from home.
Online retail, along with online communications, gaming and other interactive services are all going to see a massive boost in the coming weeks as people forced out of circulation look to continue to buy food and entertain themselves. Much money is set to be spent across online and mobile channels in the coming weeks as Coronavirus plays out across the globe.
However, that is the only upside. In reality, the world’s economy is facing an unprecedented time: in effect it is on hold – and that is something that has never happened before.
This week’s budget in the UK was, one can only assume, cobbled together very hurriedly the night before as the mooted investment budget that would lay out Boris Johnson’s investment vision and prioritise for the next five years had to take second place to ameliorating the economy against the pause button being hit.
Business rates have been frozen for many High Street retailers in a welcome move that is aimed at helping their cashflow through a period where essentially there will be no cash flowing. There are also moves on sick pay and other compensatory measures that can help to finance this tricky time.
What is interesting is that the budget, almost by accident, has introduced a load of measures ostensibly designed to help business through the Corona Virus outbreak, but has actually answered the wider prayers of the industry.
Assuming that consumers survive the recently-declared pandemic they are probably going to bounce back ready to spend in real shops and go out to real places having been cooped up for so long. Could it be that the virus that casts such a long shadow over the world is actually going to be good not only for the economy, but for resetting how we all shop and interact?
With pubs having their business rates frozen and no duty on beer, I for one will be coming out of my self-imposed hibernation with gusto when the all-clear is sounded and will be getting drunk as you like. I might even go shopping.
Let’s face it, we all go shopping on our phones when we’ve been drinking: maybe the shops should be open after the pubs shut if they really want to compete? #sh*tfacedshopping?
Joking aside, the budget has served up some salvation for the high street as well as starting the process of tackling digital sales taxation on some of the bigger online sellers. It is quite a radical budget – and it needs to be, these are interesting times – but one that could well be a bonus to us all once we have stopped coughing.