How the pandemic is creating a “low-touch” economy

Kimberly Adams Jul 10, 2020
Heard on: Marketplace
The entry area of the Akwaaba D.C. bed and breakfast. Usually the inn would be booked solid this time of year, but few customers are visiting during the pandemic. Kimberly Adams/Marketplace

How the pandemic is creating a “low-touch” economy

Kimberly Adams Jul 10, 2020
The entry area of the Akwaaba D.C. bed and breakfast. Usually the inn would be booked solid this time of year, but few customers are visiting during the pandemic. Kimberly Adams/Marketplace

COVID-19 cases are on the rise, and communities that were on a path to reopening their economy are now facing renewed shutdowns and restrictions. For those businesses that can remain open, they are experimenting and adapting their operations to respond to the needs of the socially distant and “low-touch economy” of the pandemic. 

For some companies, that means contactless deliveries to customers or having employees work remotely. The first thing that had to change at the Akwaaba D.C. bed and breakfast to adapt to the low-touch economy was the welcome ritual, said owner Monique Greenwood.

“We’re accustomed to hugging people, you know,” she said of visitors to the Victorian-era townhouse in Washington, D.C.’s Dupont Circle. “When guests walk in, we greet them with a warm hug and it’s all love, and now to have to be at a distance is difficult.”

Akwaaba D.C. bed and breakfast in Washington’s Dupont Circle neighborhood. (Courtesy Akwaaba)

She’s made other changes to adapt to the times. On-site staff regularly wipe down surfaces, keeping an eye on guest movement to see what gets touched. Communal hors d’oeuvres and dinners in the formal dining room have been replaced by in-room dining and snack baskets. Extra towels and sheets are placed in the eight literary-themed bedrooms at the beginning of the stay to limit anyone entering a room to clean. 

Monique Greenwood, owner and CEO of Akwaaba Bed & Breakfast Inns, has had to make changes to her business during the pandemic. (Courtesy Greenwood)

But the lack of touch can have broader business implications, according to Andrea Luangrath, who teaches marketing at Iowa University’s Tippie College of Business

“In business, [touch] really helps foster relationships. So even if you’re just engaging in a handshake or in kind of unobtrusive touches, like on the upper arm, this fosters connection with other people,” she said.

Luangrath said research supports the idea that touch can help boost the bottom line as well. 

“So if a service provider touches a customer, we know things like they are more likely to buy your products, they’re more likely to just sample and try your products.”

The pandemic is forcing touch-dependent businesses to adapt, said Jennifer Tsitsopoulos with the Board of Innovation, a consulting firm advising companies on the transition.

“The service sector has been one that has moved the quickest,” said Tsitsopoulos, “mostly because those have been smaller, more nimble businesses who have been able to pivot and come up with creative solutions, because they’ve needed to.”

Restaurants have adjusted their layouts and hair salons are implementing staggered scheduling. Akwaaba D.C. owner Monique Greenwood runs four other inns along the East Coast, all pretty small with few staff on site. 

“And we do think that that gives us an advantage, because there’s not a lot of people in and out of the lobby where they have to worry about their ability to social distance,” she said.

That was the lure for actress and producer Sheryl Lee Ralph, one of the recent guests at Akwaaba D.C. She was in the city working on her next directing project and was sharing the eight-bedroom inn with just one other guest and the innkeeper. 

“I chose this space, and it was the right space for me because I’m not around a whole lot of people,” said Ralph, “and whether I can control it or not, I feel as if I have a bit of control of my surroundings.”

Tsitsopoulos at the Board of Innovation said more businesses will have to shift to “boutique” or exclusive experiences, targeting the customers willing to pay for that control over their surroundings even after the pandemic ends.

“So if you have the money, you can book out the whole salon for yourself and have this still high touch in a low-touch economy experience,” she said. The trend could extend to other businesses that usually encourage crowds, like movie theaters. “Being able to have these smaller pod rooms where you can book out the entire cinema for you with your closest friends or family to still enjoy that night out, but be confined to a smaller group setting.”

But that’s if someone has the money to pay for these kinds of experiences. With tens of millions of people out of work and services getting more expensive as businesses adapt to the risk of COVID-19, Tsitsopoulos said this pandemic may push the haves and have nots of this economy even further apart.

COVID-19 Economy FAQs

It’s still the question on everyone’s minds: What’s going on with extra COVID-19 unemployment benefits?

The $600-a-week payments have ended, officially, as of July 31. For now, there is no additional federal pandemic unemployment assistance. House Democrats want to renew the $600 payments. Senate Republicans have proposed giving the unemployed 70% of their most recent salary by this October, when state unemployment offices have had time to reconfigure their computer systems to do those calculations. Until then, jobless workers would just get another $200. But, nothing has been signed into law yet.

What’s the latest on evictions?

For millions of Americans, things are looking grim. Unemployment is high, and pandemic eviction moratoriums have expired in states across the country. And as many people already know, eviction is something that can haunt a person’s life for years. For instance, getting evicted can make it hard to rent again. And that can lead to spiraling poverty.

Which retailers are requiring that people wear masks when shopping? And how are they enforcing those rules?

Walmart, Target, Lowe’s, CVS, Home Depot, Costco — they all have policies that say shoppers are required to wear a mask. When an employee confronts a customer who refuses, the interaction can spin out of control, so many of these retailers are telling their workers to not enforce these mandates. But, just having them will actually get more people to wear masks.

You can find answers to more questions on unemployment benefits and COVID-19 here.

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