As "social distancing" continues in the midst of the fast-spreading coronavirus, industries that rely upon brick-and-mortar customer purchases and in-store experiences have been hit the hardest. However, industries that are largely online and tech-related, or produce hygiene products, have been able to weather the pandemic.
More specifically, antiseptic labels, medical suppliers, canned food brands, and at-home entertainment companies seem to have been profiting the most from the situation at hand, since these have been seen as conducive to effectively countering the virus while remaining remote.
For example, A Clorox (NYSE: CLX) spokesperson said that the company has increased production of its disinfecting products based on increased customer interest in its hygiene wipes. Purell, a flagship name in the domain of hand sanitizers, has also experienced immense demand, as a spokesperson confirmed that the brand has seen "several demand surges in the past during other outbreaks, and this is on the higher end of the spectrum but not unprecedented."
Interestingly, demand for household cleaning brands is so high that some brands are entirely shying away from wielding coronavirus as a marketing tool, so as to quell demand creation. Allen Adamson, founder of the marketing firm Metaforce said that this, in addition to the fact that the Food and Drug Administration is hyper-aware of any product advertising that isn't backed by a clinical study, means such brands "don't need more demand creation." He also said: "They're already having to run factories 24/7 to keep up with demand."
Any company that forms an integral part of what people refer to as the "homebody economy," fortified by a strong "Netflix and chill" culture, has been doing well. That means Netflix (NASDAQ: NFLX) itself, and other online streaming services will benefit from the social distancing that has forced people to stay home and entertain themselves. While the broader market is tumbling, stocks for the homebody economy, which include the video-conferencing service Zoom (NASDAQ: ZM), the fitness equipment maker Peloton (NASDAQ: PTON), and technology companies like Netflix, are rising. Zoom has also been employed by college campuses, schools and workspaces around the nation to administer online classes, conferences and meetings.
On the other hand, entertainment services or venues involving large congregations or gatherings of people have been hit extremely hard, with trade body U.K. Hospitality reporting a 7% drop in sales at bars and clubs in the past week itself. Even though young people are not included in the at-risk group for coronavirus, the need to practice social distancing and fear of infecting an older loved one has kept youths at bay and at home.
Vox's Matthew Yglesias wrote: "In other words, stocks fall not because bad things have happened to companies but because there is good reason to believe that bad things will happen in the future." Rising stocks might not be an accurate indicator of how these companies will perform in the long run (or if people are buying more Netflix subscriptions), but it does reveal that investors think Zoom's, Netflix's, or Peloton's short-term outlook is bright and profitable.
Thus, any industry that has potential to become integrated into this homebody economy, and will become "staples" in this increasingly remote economy, is likely to experience upside in the waning conditions of the current economy.