Report: Emerging Business Opportunities in 2021 and Beyond
By The Looka Team Apr 15, 2021
In 2020 all industries across the globe felt a shift. Some businesses closed, while others thrived, and in many cases completely new business ideas surfaced and took hold of the consumer market.
If you’re an entrepreneur looking to start a new business, you’re probably wondering what business opportunities lay ahead in a post-pandemic world. We’ve read through dozens of reports from trusted news authorities to bring you our 2021 Emerging Business Opportunities report.
Packed full of exciting future business opportunities, we’ve taken the time to analyze which business trends have already peaked, which are slowly increasing in value, and which business trends are just beginning to show signs of heating up.
In many cases, we’ve been able to corroborate these business opportunity trends with data from Looka, through a surge of logo purchases in a certain industry, or a rise in website traffic to some of our logo ideas pages. Aside from industry-specific traffic increases, Looka also saw an overall rise in site visitors in 2020—indicating an interest in entrepreneurship as a whole.
New businesses that emerged in 2020
New business opportunities rushed the market at the start of 2020 due to a spike in demand for certain pandemic-related products or services. Some savvy entrepreneurs started businesses in these areas while supply was low and demand was high. But not all early-2020 business opportunities have staying power.
Let’s take a look at some of the biggest small business trends we saw last year, and discuss whether or not they’re worth going after today.
Masks, hand sanitizer, and other medical equipment
Nothing swept the small business scene faster, and with hotter demand, than masks and other PPE in 2020. Everyone from 3M to your next-door neighbor rushed to produce masks and hand sanitizer at the end of the first quarter last year.
Our prediction: At Looka, masks, and mask-making businesses emerged as an entirely new business category on March 3, 2020. Mask-related logos peaked from September to October and have fallen 44% since the peak. Masks have gone mainstream, and there is less opportunity for small businesses to make money from mask making.
Virtual recreation
From online parties and social events to virtual workshops and book clubs, almost all forms of social gathering transitioned to the online world for a time in 2020.
Our prediction: With Zoom fatigue already reaching a high, we predict people will race back to forms of in-person gathering and recreation when it’s safe.
Sleepwear and loungewear
Loungewear and leggings sales spiked by 1,303 percent in 2020 according to new data from John Lewis. We saw retail clothing brands race to adjust their “perfect night out” campaigns to “perfect night in” messaging.
Our prediction: We’re likely to see an interest in loungewear continue as many workers have shifted permanently to a work-from-home lifestyle. Keep messaging targeted to your audience, and focus on niche interests like sustainability, organic material, and diversity in branding.
Deep cleaning and disinfection services
Cleaning and sanitation services saw a massive increase in demand. While commercial cleaning was a mature industry, corporations, small businesses, and individuals turned their focus to deep cleaning as COVID swept the globe in 2020.
At-home food trends (Dalgona coffee kits, banana bread, sourdough equipment)
Stuck at home, folks rushed to happy hobbies like bread baking. In March of last year, searches for banana bread topped 1.5 million in the US, a 276% increase from the previous monthly average.
Our prediction: Feedback from grocery delivery service, Instacart’s recent Essential Insights Report indicates that most consumers are done with the early pandemic bread-making trend. However, food trends come and go, and if you’re plugged in on social media, you may be able to get ahead of the next trend.
At-home kids activities
With schools, camps, and clubs operating remotely in 2020, kids spent more time at home than ever before. While FaceTime calls might have worked in a pinch, they couldn’t replace actual facetime. As kids return to the classroom and playground, you can expect at-home and digital kids’ activities to take a timeout.
Errand-running services
As many people tried to limit their exposure to others during the pandemic, errand-running services took off. A good indication of this trend comes from retail and grocery delivery service Instacart, which doubled its valuation in 2020.
Our prediction: Between 2019 and 2020, Looka saw 25% more delivery service logos created and 24% more delivery service logos purchased. However, as infection fears ease, many people will be eager to return to their old routines—even less-than-fun errands.
Emerging business ideas for 2021 and beyond
Not all businesses that emerged in 2020 have staying power. But trends that arose from the pandemic like working from home, virtual social and health connections present business opportunities for 2021 and beyond.
Below is a list categorized by industry, of emerging business ideas that are currently in high demand. We’ve ranked the level of time investment ? and financial investment ? on a scale of 1-5, so you have an idea of which business opportunities require higher or lower investment.
Skincare and beauty treatments
- Financial investment: ?????
- Time investment: ?????
Lipstick sales took a nose-dive in the early pandemic months, but skincare is massively in demand right now. Check out this infographic from McKinsey’s 2021 beauty report.
Since mask-wearing has normalized, the urge to wear makeup decreased (half of your face is covered after all) but the need to prevent “maskne” (that’s acne resulting from constant mask-wearing) has provoked a heightened interest in skincare products.
The beauty industry relies heavily on in-store purchases, so take time to connect with customers online and focus on building an online presence while the pandemic continues.
Fitness equipment and accessories
Financial investment:????
Time investment: ????
People spent a lot of money creating at-home-gyms, and while many eagerly await a rush to regular gym workouts, 9 out of 10 Americans plan to continue working out from home in 2021 and beyond. As our lives and routines changed drastically, consumer interest in fitness equipment during the first year of the pandemic increased 175%.
Our prediction: Starting a business selling fitness equipment looks to have a sustainable future, especially when paired with a service offering like virtual fitness, or online personal training. Dropshipping is a great way to make this business opportunity more affordable.
Virtual fitness classes and training
Financial investment: ??
Time investment: ???
The $4 billion success of Peleton shows us one thing: branding is everything. Peleton’s brand is responsive to the changing circumstances, they listen to their customers, they engage with their community on all social media channels, and they offer branded products. It’s a fail-safe business.
Our prediction: Small businesses have a shot at maintaining virtual fitness classes and training if they focus on niche markets. Research niche audiences: working moms, post-partum, people suffering from burnout, frontline workers, teenagers, etc. Target your local area and occasionally move to outdoor workouts to generate a sense of community.
All-things gaming
Financial investment: ???
Time investment: ???
As many people turn to safe, at-home entertainment, the US has spent $1.8 billion on gaming and gaming hardware. Videogames are now a bigger industry than movies and North American sports combined, thanks to the pandemic.
At Looka, interest in gaming logo design grew 91% YoY from March 2020 to March 2021. This interest appears to be sustained, with 16% continued growth from September 2020 to March 2021.
Home decor and improvement
Financial investment: ???
Time investment: ???
Home renovation plans in Canada rose 40% in 2020, according to a survey by TD Bank. As more workers stay at home post-pandemic, the reality of more time spent at home means investing in how home looks and feels.
Our prediction: We’re seeing many more home styling and interior design businesses emerge. As well as real-estate staging, and Airbnb styling once traveling and the real estate market open up.
Garden and yard care
Financial investment: ???
Time investment: ????
From the fear of lack of food supply to an increase in home gardening for pleasure, the gardening industry experienced several sales spikes throughout the pandemic. In the US, sales revenue increased nearly 9% from Spring 2019 to Spring 2020. Online searches for home gardening saw a massive spike during the Spring of 2020, as the graph below shows.
Our prediction: Many authorities predict home gardening is a trend that’s here to stay. While sales will always be seasonal, take note of peripheral business opportunities in this industry like gardening tutorials and educational content, workshops, and yard care services.
At-home office equipment
Financial investment:????
Time investment: ???
In 2020, almost 42% of the American workforce was working remotely. While some of those workers will be returning to the office in 2021 and beyond, many will be sticking with their cloffice. For those settling into #remotework life long term, great home office equipment will be a must.
Source: https://upwork.com/documents/future-workforce-pulse-report-2020
Tip: Don’t just market to your end-user. Try targeting businesses looking to provide perks to remote employees. By getting in on B2B, you can gain larger contracts and long-term loyalty.
Clothing resale
Financial investment:?
Time investment: ????
The daily routine of donning the same quarantine sweatsuit inspired many to clear out their wardrobes. A lot of those unworn clothes found new life in the clothing resale market. With the recommerce market expected to hit $64 billion in 2024, there’s a lot of opportunity hanging in your closet.
Source: https://thredup.com/resale/
Tip: You don’t need a closet of unworn designer items to make it in this industry. As the clothing resale market expands, sellers will require new products and services to streamline the process.
Beyond the pandemic: business opportunities for life after COVID-19
While it’s hard to predict when life after the pandemic will normalize, it’s never too early to start planning for the future. These business ideas all have one thing in common: a sense of optimism. From party clothes to travel planning, they look forward to brighter days.
So, if you want to get in on the good times (before they start rolling), consider starting a business from this list.
Formalwear and workwear
Financial investment: ?????
Time investment: ?????
While people have been all too happy to swap their workwear for workout wear in 2020, the return of in-person and in-office occasions will usher in a demand for going-out clothes. Already, as public life begins to open up again, people are increasingly choosing dresses, dress shirts, and dressing up over the same tired sweatpants.
With many people having spent quarantine clearing their wardrobes, there’s plenty of opportunity in playing dress-up.
Source: www.businessoffashion.com/briefings/retail/consumers-are-already-saying-goodbye-to-their-sweatpants
Our prediction: Keep comfort in mind. Most people have spent over a year in loungewear, just because they want to look good doesn’t mean they don’t want to feel good. Elastic waistbands and looser silhouettes will offer a way to dress up, without sacrificing comfort.
Career coaching
Financial investment: ??
Time investment: ?????
Even when people have the right clothes for work, they still might not be happy there. Working from home has left many workers feeling burnt out. In a recent Harvard Business Review survey, 89% of respondents said their work-life was getting worse. Add onto that 55% who said they didn’t feel they could maintain work-life balance, and you have a career crisis on your hands.
While many employers think they’re doing a great job improving education, health, and clarity for employees, those same employees feel differently, see the infographic below for details.
Source: www.ibm.com/thought-leadership/institute-business-value/report/covid-19-future-business
Our prediction: With both professional lives ready for a revamp, skilled career coaches will be in high demand. For anyone interested in career coaching, it’s best to begin by brushing up your own career story. After all, no one wants a career coach who doesn’t know the game.
Hiring & talent acquisition services
Financial investment: ??
Time investment: ?????
The flipside of increased job searching will be increased recruitment. After waves of layoffs early in the pandemic, many roles will need to be filled again. For companies that find themselves short of a workforce, hiring and talent acquisition services will be indispensable. If you’re a people person with a large network, this business might just be for you.
Our prediction: With the increase in remote and hybrid work, recruiters need to think differently. Understanding how to recruit and hire remotely will help to put you ahead of the competition.
Travel and tourism
Financial investment: ????
Time investment: ?????
When people aren’t at work, there’s a good chance they’re going to be out of town. Staycations were the only vacation in 2020, but that won’t be the case in 2021 and beyond. As an indication of the travel to come, the TSA plans to hire 6,000 new security screening officers for the summer of 2021.
Cashing in on pent-up travel energy can come in many forms. From bed and breakfasts, to guided tours, to curated cultural experiences, there are plenty of high-demand business ideas (and startup costs) to choose from.
Our prediction: Sustainability is already a hot topic for fashion and it’s making its way into travel. If you’re looking to get into travel and tourism, you’ll want to take into account the growing ethical considerations of travelers.
Makeup and cosmetics
Financial investment: ???
Time investment: ????
From combatting maskne or promoting self-care, skincare was everywhere in 2020. As consumers were happily adding sheet masks and eye creams to their carts, color cosmetics got left behind. In the US, prestige color cosmetics sales dropped 52% in Q2 of 2020.
Our prediction: As events and other excuses to wear lipstick pick up, this tide can be expected to turn. Combined with a cultural moment embracing cosmetic experimentation, it’s a great time to start a makeup brand.
Event planning
Financial investment:???
Time investment: ?????
From weddings, to concerts, to plays, more than a year’s worth of memorable events have been put on hold due to COVID. Now, with event companies’ stocks soaring, it’s clear people are eager to get back to the festivities.
Tip: While plenty of people will be lining up to go to events, some might be a bit more hesitant. To cater to both crowds, consider adding a digital component to complement in-person events.
Restaurants
Financial investment:?????
Time investment: ?????
In March 2020 alone, searches for food delivery shot up to over 300x normal. Now, after more than a year of dining-in, people are eager to trade their take-out boxes for something more formal. But with many restaurants having shut down in 2020, there will be a reduced supply to meet this increased demand.
Source: https://blog.yelp.com/2020/04/yelp-coronavirus-economic-impact-report
Tip: To attract eaters, you’ll need to serve a memorable experience on top of tasty food. Memorable, Instagrammable interiors and events will help to fill up reservations.
What industries will grow in 2021?
All in all, the industries that will grow in 2021 cater to the outgoing, going-out crowd. Whether at work or at play, people are looking for something to be excited about. If you want to start a high demand business that will grow in 2021 and beyond, keep these considerations in mind:
- What have people been unable to do in 2020 that they will want to do in 2021?
- What occasions will be returning? And what will people need for those occasions?
- Which simple pleasures have people come to appreciate?
- What are some niche products or services related to these ideas?
Make a list of answers to all of these questions. Then, determine your level of risk and the amount of time and financial investment you’re willing to put in. It might be worth surveying some friends and family about your ideas and gauging people’s interest and reactions. Once you’ve done this initial assessment, you’ll have a better idea if you’ve got a viable business idea on hand.
What businesses won’t last?
On the flip side, the industries unlikely to last past 2020 are those that thrived under restrictions. Mask mandates, travel bans, and business closures gave rise to many new businesses. From homemade masks to virtual workouts, to loungewear, businesses focused on staying in are going to start waning. If you want to update your business idea for the world to come, consider:
- Adding an in-person component to virtual recreation and fitness services
- Keeping safety and cleanliness top of mind and visible to customers
- Leveraging loungewear materials to make event-ready garments
- Translating online food trends into new recipes and pre-made options folks can order
There are sure to be tons of business opportunities that come up as we move into the second half of 2021. Stay actively involved in your communities and pay attention to what consumers are looking for as a sense of normalcy comes back to society.