Here we are representing the seventeenth part of “B2B Analytics and Its Scope in Industry”. This time we are going to discuss Beauty and Wellness Industry. Let’s go through the Beauty and Wellness Industry report and knows how B2B Analytics is improving beauty and wellness sector and stepping ahead to make it better. B2B Analytics can play a vital role in the Health and Beauty Industry. Let’s go through the whole beauty and wellness industry analysis.
Wellness is about making healthy lifestyle choices and maintaining one’s well-being both physically and mentally. In recent years, more people around the world have begun to recognize the importance of wellness – a trend which has seen the value of the industry increase year-on-year. The various segments making up the wellness industry are diverse and include, among others, healthy eating and weight loss, fitness, alternative medicine and the spa industry. This data can be effectively used to market the services to the right consumers and increase the sales.
Beauty and Wellness Industry Overview:
- Cosmetic and Beauty:46 Billion USD in 2016;
- Annual Growth: 3.1%
- Health and Wellness Spas: 17 billion USD;
- Annual Growth:9%
- Enterprise Application Software: 38 Billion USD;
- Annual Growth:1%
Beauty and Wellness Industry Analysis:
The spa industry in the United States generated 14.7 billion U.S. dollars in revenue from more than 20 thousand locations in 2013 as compared to 2010, the U.S. spa industry reported revenues of 12.8 billion U.S. dollars. The spa industry segment of the global wellness industry was worth an estimated 94 billion U.S. dollars in 2013. In comparison, beauty and anti-ageing, which was the biggest segment in the industry, generated revenue of over 1 trillion U.S. dollars.
In 2013, the market size of the global wellness industry amounted to more than 3.4 trillion U.S. dollars. The beauty and anti-ageing segment were by far the largest, constituting around a third. During a national survey by market research company Nielsen Scarborough in spring 2014, 15.54 million people said that they had used day spa services within the past 12 months.
In the last five years, the health and wellness industry, including organic personal care, yoga studios and fitness clubs, has experienced growth in the United States, according to industry reports by Ibis World and Grand View Research. Organic personal care products are expected to grow by nearly 10 percent a year by 2020. Yoga studios have grown 2.8 percent annually since 2010, fitness clubs have grown 2.2 percent annually since 2010, while health and wellness spas have grown 2.7 percent annually since 2010, according to IBISWorld.
Challenges of the Wellness Industry:
There are a number of systemic challenges faced by the wellness industry which, if left unaddressed, can stymie the future growth potential of the industry. Prevailing challenges include the following:
- While players are developing strategies to control costs and arrive at optimal cost structures, managing input costs continue to be a challenge due to the limited capability of the players to pass on these costs to the customers.
- The wellness industry continues to face a talent crunch. This paucity of skilled talent has resulted in high manpower costs and attrition levels. This may result in a ‘war for talent’ unless active measures are taken to create credible and accessible training infrastructure.
- Industry consensus emphasises the importance of improving the overall quality standards within the sector. Accreditation and quality certifications are pre-requisites in order to achieve this goal. However, there are gaps that need to be bridged to minimise execution challenges and ensure conformity to quality standards across the industry.
- In most of the parts of the world, one of the biggest challenge today is ‘Zero Regulation’ of this Spa and Wellness Industry. Currently, there is hardly any regulation of this industry, all you need is a ‘Shop and Establishment License’ to start this business. This brings to notice the shady businesses that run around the world in the name wellness centres. This also gives chance for possible corrupt practices.
- Investors are also looking at this industry very positively and looking for Investments in this sector. Various Funds certainly have no doubts about how profitable it can be to Invest in ‘Spa and Wellness Industry’ but again they are slightly sceptical about investing due to ‘Zero Regulations’ as they are not sure about where this business stands today due to fine line between being ‘Professional Clean Spas’ and being perceived as a ‘Massage Parlour’.
Analytics of Beauty and Wellness Industry:
The beauty and wellness industry is about to undergo massive disruption. Though technology has neglected this industry for decades, things are changing quickly for the almost three million professionals and businesses in the $40 billion space. In the past, these beauty professionals haven’t had the ability to grow their businesses. Many used pen and paper to manage their schedule, which made analytics difficult and marketing impossible. While the average stylist is only booked 70 percent of the time, there’s been little they could do to get more clients outside of client word-of-mouth.
But new technology has completely changed the game. Companies like LivingSocial and Groupon have proved that professionals can get new clients by creating a daily deal; Facebook and Twitter build online word-of-mouth that can drive customers; and companies like StyleSeat, powers beauty and wellness businesses with online booking, analytics and tools to help them grow. The combination of a business platform, marketing and new clients means that for the first time almost three million beauty and wellness professionals and businesses are now empowered to take control of their growth. With insight into their metrics, professionals and businesses will know what they can afford to spend to fill appointments. Since the value of appointments depends on how hard they are to fill (today versus next week), analytics will be able to tell them what empty appointment times are worth so they can fill them while staying profitable, empowering them to take advantage of their success and grow in a sustainable way.
Marketing Analytics of Wellness Industry – Social Media:
Instagram became as useful to brands this year as it had already become for consumers, particularly for an emerging sector like wellness. For brands, it became an invaluable source of insight into consumer behaviour, competitive analysis and a clever tool for the evaluation of new and innovative ideas. It also became the cheapest and most effective marketing channel of all time – allowing brands to quickly and cleverly communicate with millions of people across a range of demographics. And as the popularity of hashtags like #cleaneating #healthyliving and #fitfam suggest, this market is certainly big enough for everyone. Bloggers and Instagrammers realised the enormous commercial potential that exists in a strong social media following and becomes brands in their own right. In many cases, backed by the negotiating power of agencies (who’ve also tapped into this burgeoning field), the big names in wellness have launched themselves into the spotlight with online platforms, product collaborations, events, and in some cases, even physical retail outlets.
Several fitness, wellness and beauty based companies have started using these social networking mediums to target their customers precisely. Instagram and Facebook analytics are being used very strongly in this sector and is being used to attract the customers. Currently, Instagram is being used by 48.4% of the brands across the world and this is expected to rise up to 70% in this year. A major section of these brands is beauty and wellness based. Social media is becoming an increasingly important channel for brands to reach and interact with consumers. Even though Instagram is the fastest growing medium, Facebook still dominates in this industry Avon leads with its widest use of Facebook geographically and Clinique has the highest interaction so far. The age group that is most active in this industry is 23-35.
Customer Analytics of Beauty and Wellness Industry:
The industry has not yet entered into customer analytics with full vigour. Most of the companies in the USA are not using any kind of analytics on customers and the maximum they are using some simple tools and software to keep a track of customers’ visit. However, there are some big brands that have been spending heavily on customer analytics in this sector. Surveys and customer research is being done to understand customer behaviour and needs. Based on the analytics created from there, companies are doing investment in their R&D. This is only for the companies that produce beauty products and cosmetics. Wellness spas, resorts and fitness centres have not yet entered this area.
If we ignore customer behaviour, a large number of fitness and wellness centres are using analytics to monitor their existing customers and guide them properly for best results. With the right usage of your members’ data, you will begin to understand their preferences, lifestyle choices, their fitness goals and the technology they have already invested in. By aligning your business to their specific requirements, your members will feel pumped up because their needs are being catered to; it could be with the provision of facilities, specific fitness classes or providing content that will allow your members to stay on track with their goals.
This muscular understanding of your customer’s experience will reduce the rate of churn and create a loyal membership, strengthening the bond between their experience and your business.
THE TOP WELLNESS TRENDS OF 2017 ARE HERE!
Consumers are progressively adopting healthy and wellness-related practices. As a result, companies operating in the fitness centres business now see their customers base grow at rates never seen before. However, managers are also conscious of the volatility of consumers’ desires, particularly those signing up for this kind of services. This leads to a high churn rate.
For this reason, any strategies geared towards understanding and successfully managing the business become a significant competitive advantage. In this context, an analytics exercise was done using data from a chain of fitness centres in Madrid (Spain). Obtained results are presented next.
Sales Analytics of Beauty and Wellness Industry:
Consumer spending data suggests that your customer’s journey begins much earlier than you’d expect. Before becoming members, consumers first make a choice to live a healthier lifestyle. They reflect this choice by making considered purchases encompassing healthy foods, training gear & fitness trackers such as Fitbit, which accounted for 21% of the wearable market share in 2015. Fitness trackers, smartwatches and mobile apps are creating a deluge of data that will become an asset if combined with an understanding of your members’ experience. Isolated dashboards and tools can be useful for an individual but a business requires an integrated analytics platform that can collate and process data from a variety of sources.
We discussed E Commerce Industry, the Sixteenth part of the series “B2B Analytics & its Scope in Industry’s”. Previously we discussed nine industry in B2B Analytics were “Food-Chain Industry”; which was the first part, “Banking Industry”; the second part, “Healthcare Industry”; the third part, the fourth part was Manufacturing Industry’s a part- “Food Manufacturing Industry” and “Discrete Manufacturing Industry”; the fifth part. The sixth part we discussed the “Education Industry”; the seventh part was “Insurance Industry” and eighth part was “Government Data Analytics”; ninth part was “Retail Industry”; tenth part was “Transport and Logistics Industry”; and the eleventh part was the “Telecommunication Industry”. Twelfth Part we discussed was “Media and Entertainment Industry”; the thirteenth part was “Consumer Packaged Goods Industry”; the fourteenth part was “FMCG Industry”; the fifteenth was “Pharmaceutical Industry” and the sixteenth part was “E Commerce Industry”.
In our next edition, some more interesting industries to be left for the discussion be ready to take a deep insight and we will discuss a lot about them. Stay tuned to us for further more deep insights in the industry. The next part will be out soon.
For customised market research reports for any kind of startups and business in any industry, you can contact Craft Driven Market Research team here directly.