Rohan Bhandare highlights various industry trends, which have undergone a change in light of the pandemic
The term ‘Butterfly Effect’ indicates a possibility that a tiny act of a butterfly flapping its wings at one location may
result in an unpredictable event, such as a change in the weather conditions at another location.
Covid-19 has truly been devastating and has severely impaired lives as well as livelihoods. As we gradually recover, we can see that digitisation has accelerated the evolution of business models. The early examples of the rise of Zoom over Skype in the video conferencing segment and increased market share of F.A.N.G. and Jio are well documented.
However, a year into the post-covid era suggests that this was only a start to the Butterfly Effect. Technology is now acting as a catalyst to produce new and unlikely competitors in various industries.
Here are a few examples of industry trends, which have undergone a transformation.
Acquisitions of Established Players
Historically we have seen traditionally larger companies acquiring its smaller competitors to gain market share. However, in this new era, we see decades old players being acquired by new digital players.
Byju’s, the country’s largest online Ed-tech start-up, has acquired a 33-yearold brick-and-mortar coaching centre,
Aakash Educational Services.
In the financial space, we have seen Bharatpe tying up with Centrum Financial Services to takeover PMC Bank; and a 5-year-old company, Groww acquiring the mutual fund business of IndiaBulls.
Apparels and Lifestyle
We know about the competition between brick and mortar apparel stores and e-commerce. However, could you
imagine that the businesses of innerwear would ever compete with formal/casual wear?
With Work from Home on the rise, the market segments of Page Industries (Jockey) and Rupa Industries are now
competing with Raymond. Similarly, Relaxo chappals are now competing with Bata’s formal shoes.
The curious term ‘Revenge Shopping’ is also doing the rounds, which may again boost this sector.
Health and Fitness
We have all witnessed the classic competition of the Cola giants. Unexpectedly, Cristiano Ronaldo ne ispe paani pher diya. With even a slight fever now being doubted as a covid infection, there has been a surge in demand for healthy and immunity boosting food. Although gyms were temporarily shut down, we see that the online fitness industry is flexing its muscles. Players such as Cult.fit have begun an acquisition spree and in turn is attracting investment
from the Tata Group.
Furniture and Home Decor
Can you name the biggest competitor to Fevicol (Pidilite)? Even with such a luxurious market segment, the group
has put its hat into the e-commerce ring with a stake in HomeLane and Pepperfry. With even traditional industries like Godrej going digital, the online furniture space consisting of other captains such as Urban Ladder (recently acquired by Reliance) and IKEA will be the one to watch.
Pharmaceutical and Diagnostics
Although the Pharma sector was always in the vaccine spotlight, the diagnostics industry has also undergone a drastic change by adopting self-monitoring devices, digital test reports and telemedicine. The recent acquisition by PharmEasy – a unicorn startup, of Thyrocare, a listed company shows how prized this sector is.
With new variants of covid being found, the industries associated with genome sequencing are also booming.
E- Merging Platforms
With no face to face meetings, companies such as Info Edge India Limited have done well to digitally hand hold youngsters, first with Naukri, then to finding a Jeevansathi and finally to 99 Acres. The B2B e-commerce space is also heating up with JustDial launching JD Mart to take on IndiaMart and Udaan.
Retail and Institutional Investors
If you thought the big investment bankers are shielded from such competitions, then think again. Internationally, we only need to see the example of Gamestop, where multi-million dollar hedge funds competed with a group of Reddit users. We are also witnessing a huge number of retail investors entering the Indian share market, ready to catch the falling knives and pump money back into the market. It will be interesting to see the impact of crypto currencies and NFTs in the times to come as well.
The Hollywood movie ‘2012’ about the start of the apocalypse is a fun watch nine years on, but there is an interesting
line at the end of the movie.
The lead character tells his kids that after the calamities, the Himalayas are no longer the roof of the world but it’s the less-than-half sized South African Drakensberg mountains on the other side of the planet.
Taking this cue, the economy and businesses would also always continue to ebb and flow at different times. All we
need to do is learn, unlearn and relearn to catch this bounce!
The writer is a Chartered Accountant and elected member of Goa Management Association’s Executive Commitee. He also chairs the Taxation Committee of GCCI
