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COVID-19 and the Growth of Digital Experiences

Digital solutions


The pandemic has accelerated the adoption of digital solutions, requiring marketers to test new formats, brands to learn and adapt to new ways of engaging with their communities, and consumers to embrace the digital age. Everyone - from grandparents using Zoom to keep in touch with family, to elementary-aged children attending class online - can appreciate and take advantage of this shift to digital experiences. With 87% of companies cancelling events and varying restrictions put in place to help curb the spread of COVID-19 (lockdowns, capacity limitations, regulations on which businesses are “essential”, limited travel, etc.), virtual events and experiences have become the norm and COVID-era innovations are expected to continue through the recovery phase and into the next normal.


The Rise of Video Conferencing and Shift to Virtual Events

Many industries have been catapulted into the future out of necessity, reaching milestones that weren’t expected for years to come. For example, U.S. e-commerce, originally forecasted to reach 24% penetration by 2024, jumped from 17% to 33% in just two months during 2020. To stay relevant and favourable with customers, companies must meet and continue meeting new consumer expectations around digital access. Many companies were quick to react to changing consumer needs, bringing to life new policies, procedures, and opportunities to engage customers. Travel companies overhauled their booking policies to provide more flexibility in response to an often-changing environment, insurance companies employed new data sources and streamlined their approval processes, and retailers doubled down on BOPIS (buy online, pickup in store) and launched digital hubs and virtual try-ons, amongst other initiatives. There were more novel activations as well (not all digital) like Qantas’ flight to nowhere, Live Nation’s drive in concert series, and Amazon Explore, all with the goal of engaging customers.


The Acceleration of Augmented and Virtual Reality

With lockdowns in place, and a fear of leaving the home, brands had to meet consumers where they were (are) – at home. Augmented Reality (AR) and Virtual Reality (VR) have continued gaining popularity during the pandemic. As a substitute for in person experiences, brands have invested in AR/VR to make products and experiences feel more tangible. Forty four million people used AR through a social network at least once per month in 2020, representing 21% of social network users. 2020’s most common uses for AR/VR included gaming and social (example: Snapchat lenses), with retail also investing in the technology.


Worldwide spending on AR/VR is forecasted to accelerate out of the pandemic, growing from just over $12 billion in 2020 to $72.8 billion in 2024, according to IDC. AR will be a bigger area for innovation in 2021 compared with VR, as social networks like Snapchat drive consumer use of AR in gaming and retail. Overall, 90.9 million people in the US will use AR at least once per month in 2021.


The Continuing Importance of Digital Experiences

Overall, consumers plan to continue spending an increased amount of time at home, most notably with cooking, shopping, exercise, banking, and telemedicine. These industries have all experienced rapid growth and innovation over the last few months as consumers turn to new types of experiences to fulfill needs that were once met offline. Eighty percent of consumers say experiences are just as important as a company’s products. Large-scale events like CES, Sundance (a $15 ticket got you access to 73 of the feature films making their premiere), and SXSW have all gone virtual. These digital experiences have the goal of reducing or eliminating human-to-human contact and have the added benefit of being more accessible to a broader audience.


As in-person events and gatherings remain limited due to the pandemic, brands should look for ways to virtually maintain a connection with their customers and make products feel more tangible. Digital experiences should be prioritised and perfected as digital engagement channels will continue to grow in importance as the keystone of brand experience.