Health and wellness is perhaps the biggest consumer macro-trend of the past decade, influencing everything from dietary changes, to organic and local food, to new fitness classes and the outfits to wear to them, to a growing outdoor movement.
Collectively, these health and wellness movements have touched on almost every element of how many Americans live their lives while driving billions of dollars in new growth opportunities for businesses and entrepreneurs.
But one area of health and wellness continues to elude most Americans: a good night’s sleep. Enter renewal: the next big wave of health and wellness.
Longer working hours, an increase in the number of single-parent households and many other factors have led 42%1 of Americans to feel more stressed and to get less than seven hours of sleep a night, compared to only 11% of Americans 70 years ago.2
Americans know they need more sleep too—43% said they would feel better with more sleep, up from 32% in 1991.3
All this data has sparked increasing growth and interest in the renewal movement—a trend that focuses on re-energizing, recovery and recuperation. The U.S. sleep industry, which incorporates consumer products, medical devices, supplements and even sleep consultants, has already grown to over $30 billion annually.4 This growth will only continue as companies generate new products and categories.
Renewal brings key activities and times in our daily lives, such as refreshing, winding down, sleeping and awakening, to the surface. (See Exhibit 1.)
Winding down involves simple, low-intensity activities such as making tea, reading a book, listening to music or meditating. These activities are aimed at clearing the mind of the stresses of a long day.
Many wind-down activities can happen in any room of the home or even in the office. Although winding down is an activity that many parents have experienced with their children—for example, the daily ritual of putting their baby to bed—many forgo winding down themselves.
Research shows that making a habit out of daily wind-down activities can improve health and reverse some of the negative effects of sleep deprivation and stress. For example, studies funded by the National Institutes of Health (NIH) have shown that meditation can reduce blood pressure.5 And the Harvard Business Review notes that some of the negative effects of sleep deprivation, such as poor memory, attention and emotional intelligence, can all be improved by meditation.6
Several brands are rushing to meet this need through a variety of means, including drinks designed to help consumers relax before sleep, wind-down bath products with soothing scents—or aromatherapy alarm clocks with the same purpose—massage pillows and chairs, and meditation apps. Japan-based department store chain MUJI even has a U.S. line of relaxing products, including an aromatherapy diffuser and relaxing furniture, like the MUJI Relaxing Beanbag.
A poor night’s sleep has wide-ranging repercussions: In a survey of over 3,400 respondents, researchers found that quality of life across all physical and mental factors was negatively impacted by a routine lack of sleep. Meanwhile, respondents suffering from severe insomnia often reported lower quality of life than patients with congestive heart failure or depression.7
These problems are not only personal, they’re societal: The NIH says sleep problems cost the American economy over $65 billion due to reduced productivity, accidents, injuries, deaths and illnesses.8
Many companies are also competing to help consumers sleep better. For example, many wearable fitness trackers and apps also track sleep, giving consumers more visibility into their sleep patterns—including the length and quality of sleep—and ways to improve those metrics.
And while not as large as the wind-down beverage market, some beverages are designed to bring on the Z’s. For example, Cheribundi tart cherry juice contains naturally occurring melatonin, which can help fuel a good night’s sleep. Cheribundi has successfully gained distribution in retailers like Safeway, Target and Whole Foods and is also sold direct-to-consumer online. The brand’s sales surged from $3 million in 2013 to $10 million in 2015, and they’re projected to reach $15 million to $16 million in 2016.9
But perhaps no brand understands the untapped potential of sleep better than online mattress retailer Casper, which sells direct-to-consumer online and in one style only, giving consumers free shipping and returns and a 100-day trial period to sweeten the deal for consumers nervous about buying such an experiential product online.
Within a month of its April 2014 launch, Casper had already done $1 million in business and recently hit $100 million, but it isn’t stopping there.10 Recognizing the green field of sleep, in November it launched a line of high-tech sheets and pillows and is looking to keep growing.
“There are very few things you can do that will dramatically change your life other than eating, sleeping and exercising,” COO Neil Parikh told Inc. “Whole Foods created a place for us to easily eat healthy. Nike reinvented everything about fitness. We thought of sleep as this last great remaining resource.”
Other products aim to block out sound, including sound conditioners or white noise machines, and the Dreampad, a pillow that uses bone-conduction technology to transmit audio from any phone or MP3 player to the user without bothering anyone sleeping next to them. The pillow also has its own app with handpicked music selections to lull users to sleep.
Aside from getting better sleep overall, Americans are also turning to naps as a quick fix to correct poor rest. Studies have shown both physical and mental benefits of a quick nap in the middle of the day. Scientists at Harvard University showed that a 60-minute nap before a test can completely mitigate the negative effects of sleep deprivation, while a 90-minute nap can actually improve performance despite a night of poor sleep.11
No wonder some offices have started adding spaces for employees to nap during work hours, like Google’s futuristic nap pods or Hammacher Schlemmer’s $30,000 tranquility pod, which blocks outside noise, plays music timed to the bed’s vibrations and has 50 LEDs that sync with your heart rate.
Some companies are also taking napping to the next level, like YeloSpa, a high-end spa chain in New York City, Brazil and Puerto Rico that offers a “bespoke” $1 a minute nap service that includes a zero gravity chair, aromatherapy and sound therapy. As shown in Exhibit 2, commercial opportunities exist across a spectrum of renewal solutions revolving around environment, behavior and consumption. Among these, numerous entry points and platforms for expansion offer the potential for dynamic growth.
A fresh and energetic start to the morning can have compound effects and improve productivity throughout the day. Although awakening is closely tied to sleep, the waking process can be just as crucial as getting a full eight hours of rest. A daily ritual of a morning shower, drinking coffee, having breakfast or taking a morning walk can bestow positive benefits throughout the day.
Waking up properly and on time has been shown to be important to performance at work. Sleep researcher Christoph Randler suggests that daylight in the morning resets your circadian clock, which promotes higher productivity and proactivity throughout the rest of the day.12
With this principle in mind, several alarm clocks and lights are aiming to wake consumers more naturally. One of them is Withings’ Aura alarm clock, which tracks sleep, temperature, light and sound to wake users at the least disturbing point in their sleep cycle and lets consumers customize their ideal wake-up light and sound—it can even mimic a sunrise or sunset.
GE also sells a pair of lightbulbs designed to help users fall asleep and wake up more easily and naturally—one has a low-blue comfort light that helps the body produce more melatonin to help ease users into sleep, while the other bulb tells the body to produce less melatonin to ease the transition to wakefulness.
After the alarm has gone off, automatic coffeemakers can help motivate consumers out of bed with that enticing aroma. For example, Mr. Coffee’s smart coffeemaker connects to Wi-Fi and lets users set a weekly automatic brew schedule.
Both of these product categories capitalize on the trendy smart home market, which is expected to grow from $47 billion in 2015 to $122 billion by 2022, a CAGR of 15%.13
Consumers energized by a cup of coffee can then hit the gym—during their morning commute. At least that’s the idea behind 1Rebel, a high-end English gym concept on a bus equipped with exercise bikes.
Refreshing, low-intensity activities can be done at any time of the day in any room at home or at work. These activities, which include journaling, walking and yoga, are introspective and peaceful. They help de-stress, refresh and refocus the mind before one moves on to another activity.
Refreshing activities like yoga have also been proven to have a multitude of physical and mental benefits; a slew of studies funded by the NIH show that yoga can decrease chronic pain, release stress, relieve anxiety, reduce depression and help cure insomnia.14
Aside from clear growth in yoga and related categories like apparel, other activities and companies are getting in on the benefits of refreshing.
Take adult coloring books, which exploded in popularity in the past year—from 1 million copies sold in 2014 to 12 million copies in 201515—by marketing themselves as a relaxing, de-stressing activity.
Or consider Good Day Chocolate’s Chocolate with Calm, which includes L-theanine, an amino acid naturally occurring in herbal teas, to help relax consumers.
Given the evidence backing up the positive physical, mental and economic benefits of proper rest and recovery, it’s not surprising that these companies, and many more, have already sprouted up to support the renewal wave.
This growth will only continue, making renewal a unique lens for companies to identify meaningful growth opportunities and to generate an entire ecosystem of new categories, products and services that can transform a company’s business. Many companies are already sitting on assets and brands that can be effectively repositioned to capitalize on these trends and build strong renewal portfolios as their next major growth platform.
As Americans become more aware of the benefits of renewal, this is one opportunity companies can’t afford to sleep on.
The Fiscal Times, 2012
National Institutes of Health, National Center for Complementary and Integrative Health, 2016
Harvard Business Review, 2015
National Institutes of Health, Institute of Medicine, 2006
Nature Publishing Group, 2003
Harvard Business Review, 2010
Markets and Markets, 2016
National Institutes of Health, National Center for Complementary and Integrative Health, 2008
USA Today, 2016