B2B tech is poised to grease the wheels of post-Covid economic recovery

28 Dec 2020

Image: Ian Blake

Ian Blake spies the opportunities for B2B tech companies to leverage a strong position in facilitating remote working, customer service and e-commerce post-pandemic.

December 2020 was the year Christmas came early, in the form of a tiny shot that promised to open the world up once more. But that vaccine can’t do the heavy lifting alone. Covid-19 devastated communities, businesses and economies. It’s all hands to the pump to drive recovery.

There’s already acres of newsprint about how the pandemic accelerated digital transformation and the technologies behind it. You can’t move for opinions on how Zoom saved remote working, or drove employees crackers, depending on your point of view. But what is less written about is how Zoom, Teams, Slack and the huge range of B2B tech solutions are all set to grease the wheels of global recovery.

But, before all that, what’s that recovery going to look like? Even the experts can’t agree. The Bank of England’s chief economist, Andy Haldane, stated in the UK’s Daily Mail in August 2020 that the economy would expand by “more than a fifth in the second half of the year”. The Central Bank of Ireland’s quarterly bulletin was cautiously optimistic, suggesting there would only be a small contraction of 0.4pc. Yet John Turner, professor of financial history at Queen’s Management School, had a more pessimistic bent, pointing to the several years he expects will be needed for industries and economies to recover from crippling losses.

However recovery happens, businesses need to be prepared for it. According to McKinsey, tech is going to be at the heart of the ‘three horizons’ approach to recovery, particularly in the ‘plan for recovery’ phase. McKinsey believes this phase – when companies should accelerate their digital ambition and analytics engines and be ready to capture demand – will be what drives rapid revenue recovery.

Remote working presents opportunities for B2B tech

Will workers flock back to the office? If the vaccine does its stuff then there’s no reason why not, other than the fact that they’ve had a vision of the alternative and quite like it. But for most it’s unlikely to be a case of either/or. Many have cited the importance of in-person interaction for brainstorming, mentoring, diversity and frankly just a bit of camaraderie. It’s much easier to all leave the office for the pub if you’re in the office in the first place. But analysts agree that there will indeed be a bigger shift to a hybrid working model.

Global Workplace Analytics found that, in the US, 56pc of the workforce holds a job compatible with remote work, though only 3.6pc actually did so half the time or more. Given the change in behaviours brought about by the pandemic, the company projects that, by the end of 2021, 25 to 30pc of the workforce will be remote working several days a week.

In the crucible of Covid-19, remote working has clearly been effective for many and that has not gone unnoticed by the B2B tech big guns. Investors have put their money where their mouth is, most recently with the $27.7bn acquisition of Slack by Salesforce. It’s a ringing endorsement of the enduring potential of hybrid working tech and one supported by research from NPD Group. In the US, USB webcam sales were up 326pc or $140m incremental revenue year on year to September 2020, while laptop sales were up 27pc. Data centre software saw 6pc channel growth in this period while data centre security software grew 11pc. This growth is expected to continue into 2021.

Capitalising on an explosion in online services

Behind the headline-grabbing antics of Zoom, Slack et al, there’s been a whole range of B2B tech that has been quietly beavering away behind the scenes, supporting companies in crisis mode and getting ready to turbocharge growth when the recovery starts. A report from Spiceworks Ziff Davis found that the top tech segments during lockdown were firewalls, business intelligence, server virtualisation, virtual desktop infrastructure and colocation. But the survey did identify Zoom, Teams et al as “secondary surging tech segments”.

Take the explosion in online services. We may have thought, rather smugly, that pretty much the whole world was online when Covid-19 hit but we were proven dead wrong. Data from the UK Office of National Statistics suggests that online sales as a percentage of total retail sales were just sub 20% in 2019. By May 2020 that had risen more than half to 33.4pc.

As bricks-and-mortar retail opens up again, some will most certainly flock back in the opposite direction, but a significant number will stay. And so companies that hadn’t made significant investment in their online capabilities ramped up investment, deploying technologies to support a beefed up e-commerce presence.

Take customer service tech for example, which saw a huge rise in some sectors. For one communication provider, Moneypenny, live chat was up 206pc in the automotive sector, 215pc in large businesses and118pc in legal firms from April to May 2020. A survey from Inference Solutions found that nearly three-quarters of IT decision-makers had relied on self-service automation during lockdown and 76pc agree that automating more customer support tasks would benefit their workforce.

This is particularly important in organisations that have had to cut staff as a result of the pandemic. For example, the IT director of Otsego County, New York turned to IBM’s Watson Assistant when call centre staffing levels were dramatically reduced.

Ultimately, we don’t have a crystal ball. Will recovery be fast? Will it be slow? I’d hesitate to make a definitive prediction. After all, what’s the saying? ‘If you want to make God laugh, tell him your plans.’

But this we can say: B2B tech companies, particularly ones facilitating remote working, customer service and online operations, have seen growth since the pandemic. As the world merges into a brighter, post-vaccine future, those B2B tech companies facilitating change and accelerating digital transformation will be in a stronger position than ever.

By Ian Blake

Ian Blake is founder and managing director of Squaredot, a marketing agency that supports B2B tech brands.