- On March 9, 2018
Consumers are placing more value on health and wellness than on material objects these days, and the definition of health and wellness has evolved. The phrase no longer refers simply to a lack of illness and disease, but to a more holistic state of being, where one’s mental, physical and emotional health are in sync. And in an era in which so many catalog their lives on social media, looking great, feeling good and sleeping well are the new luxuries that consumers want to enjoy and flaunt.
Last week, I heard Jack Ma, Chairman and Founder of Alibaba, speak at Alibaba’s Gateway ’17 summit in Detroit, and I think he properly summed up this growing trend: today’s customers want to be healthy and happy, no matter who they are. Owning the most expensive or the latest goods has taken a back seat to looking good and feeling good, and consumers are showing an increasing preference for participating in activities and indulging in experiences that promote their well-being—and sharing those experiences with their friends.
People are spending on a holistic approach to health and wellness that includes nearly every aspect of life, even sleep. Consumers are increasingly participating in fitness classes and activities that improve well-being; using products, devices and apps that aid sleep; and eating organic and natural foods, taking health supplements, and following special diets.
The popularity of the health and wellness trend is visible across consumer groups, and it differs significantly from the various food and exercise trends that took hold in previous decades. Eating healthily, exercising regularly and monitoring one’s health have become a lifestyle choice. According to Euromonitor International, the global market for health and wellness offerings reached $686 billion in 2016 and it is expected to grow at a 3.5% CAGR, to $815 billion, by 2021.
Millennials: The Driving Force Behind the Wellness Trend
While this trend is visible across age groups, millennials are driving its growth. Millennials, who were born between 1980 and 1999, have grown up in a time of rapid change, so their priorities and expectations are sharply different from those of previous generations. According to the Harris Group, 72% of millennials would rather spend money on experiences than on material goods, and that preference is forcing retailers to adapt as more millennials ascend into adulthood and increase their spending power. For millennials, wellness is a daily, active pursuit, and one they are willing to spend on. Many of them bring fitness into everyday life visibly by wearing athleisure apparel for all kinds of activities other than working out. They also enthusiastically track their fitness training and sleep data through apps: research firm Forrester found that millennials and Gen Zers combined account for 69% of all fitness wearable owners.
In terms of shopping, millennials tend to prefer an experiential retail environment that goes beyond the transactional. Anjee Solanki of Colliers International, a leading global commercial real estate company, says that “any successful brick-and-mortar retail business knows that it’s important to give customers a memorable experience in an immersive, dynamic environment by changing the physical spaces constantly to give customers something fresh and new.”
Wellness Meets Retail
The concept of wellness as a luxury is about more than just being fit—it is also about feeling happy and indulging in experiences that promote well-being, and sharing those experiences with friends. Nordstrom is one retailer that appears to be focused on providing customers with that kind of memorable experience. The company’s store in Torrance, California, offers shoppers distinctive amenities such as a roomy “girlfriend” fitting room where friends can try on clothes together and a lounge outside the fitting rooms called The Apartment that has comfy couches and flat-screen TVs so people can be entertained while they wait for friends or family to try on clothes. Nordstrom has made simple changes to its brick-and-mortar spaces to make customers feel comfortable and coddled in stores, which entices them to return.
Other retailers are also reacting to the health and wellness trend in order to stay relevant. In early May, Saks Fifth Avenue unveiled a first-of-its-kind retail space dedicated to health, beauty and fitness in its New York City flagship location. The space, called the Wellery, is located on the second floor of the store, which has been transformed into an indoor marketplace with offerings from 20 individual retailers. The Wellery combines traditional brick-and-mortar shops with unique in-store experiences to drive traffic to the store. Out of the 20 retailers operating in the space, 16 offer an experiential retail experience. Customers can visit the space to purchase fitness equipment and luxury workout gear, take fitness classes, and get health and beauty treatments such as manicures, facials and makeovers. The retailers that operate within the Wellery stay for only for a few months, acting as pop-up shops, which ensures that the space remains fresh and relevant.