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An Analysis into Wellness

Posted by Jonathan Senin on April 29, 2014 0 Comments

You can see it on billboards and television screens everywhere. A woman, struck in a pensive pose with a hint of a smile and peaceful eyes, exudes calm and serenity, surrounded by a backdrop of soothing colors like mauve and eggshell white. It could be an ad for a yoga studio, or maybe, the latest headache cure. The woman could even be the face of a campaign to sell all-natural clothing detergent. Regardless of the actual product, the idea is the same: “Come with us and we’ll make your life easier, better and more healthy.” It is the idea of “wellness.”

 

            Wellness, as a mainstream idea, is young but is growing. Radical progress in science has allowed us to understand the myriad ways we can improve the human condition. New medicine and practices keep us alive longer than ever before. The number of people practicing mindfulness meditation worldwide continues to break records, year after year. Meanwhile, the pace of business has outstripped our desire to strictly define “wellness” and has instead created an entire industry around the idea.

 

            This article will examine the wellness industry. We will discover the huge variety of goods and services that fall under wellness categories and we’ll attempt to tease out a definition of wellness. Beyond that, we’ll look at some market dynamics that are shaping the wellness industry for years to come. 

 

 

Defining Wellness

 

Ancient Origins

 

            The concept of wellness is not new. While the term “wellness” is a recent invention, the idea of living well has ancient roots. The oldest iteration of wellness, as we understand it today, came from the ancient Hindu texts, Ayurveda. They espoused harmony between body, mind and spirit, striving for a balance that prevents illness and contributes to a long, healthy life. Yoga, and other offshoots of meditation, can be traced back to the Ayurveda. Holistic approaches to health and living were also found in traditional Chinese medicine. Old medical practices like acupuncture, herbal remedies, and tai chi started in this period and are still popular today.

 

            In 500 BC, Greek philosopher Hippocrates established an extremely influential precedent by focusing on preventing sickness, instead of just treating diseases. Prevention, in his eyes, was a byproduct of lifestyle choices, diet and other environmental factors. A few centuries later in 50 BC, the Romans popularized the Hippocratic belief of sickness prevention by establishing institutions like public-organized health care and infrastructure, like sewer systems and public bathhouses.

 

             Fast forward to the 19th century, humanity experiences an explosion of liberating theories and thoughts. The Renaissance, and the accompanying scientific inquiry into all areas of human life, carved out creative space for new, albeit strange and untested, ideas into improving humanity’s well being. In the 1860s, a German priest named Sebastian Kneipp promoted his own healing system, based upon a combination of hydrotheraphy and herbalism, exercise, spirituality and nutrition. A decade later, Mary Baker Eddy founded the Christian Science practice, and began practicing spiritual healing. While nutrition had always been a hot topic amongst historical counterparts, Swiss physician Maximilian Bircher-Benner became the first to pioneer scientific and objective nutritional research and claim that fruits and vegetables are an integral part of a healthy diet. In the 1890s, Daniel Palmer founded the practice of chiropractic, focusing on the body’s structure and functioning. The YMCA also begins its humble start as a place for community youths to exercise and interact. By the next century, the primacy of scientific evidence and observation begins to take hold. In 1910, the Carnegie Foundation’s Flexner Report established a strong precedent for modern, evidence-based, disease-oriented medicine.

 

Modern Iterations

 

            In the past century, the idea of wellness as we know it truly begins to take shape. In the 1950s, amongst omnipresent cigarette smoke and rampant alcohol consumption, J.I. Rodale founds Prevention magazine, a pioneering publication in promoting alternative medicine. He’s also one of the founders of organic farming. In that decade, physician Halbert Dunn presented his ideas of “high level wellness” in a series of 29 lectures, culminating in a book called High Level Wellness. Many wellness practitioners cite Dunn as the “grandfather” of the wellness movement. While he wasn’t the very first to advocate for wellness, his influence on physicians, intellectuals and healers is undoubtable.

 

In the 1970s, Dr. John “Jack” Travis, who was influenced by Dunn’s writings, created the first wellness center in California. In order to treat patients, he developed a 12-dimension wellness assessment tool  (The Wellness Inventory, 1975) and published them in the book, The Wellness Workbook (1977). The criteria for judging wellness are still in use today. Don Ardell, also borrowing from Dunn’s ideas, published his first wellness book in 1977, titled High Level Wellness and became a leading figure in the wellness movement; he regularly speaks at conferences, lectures, and wellness conferences. Ardell is often cited as responsible for the proliferation of the wellness life, reaching wide audiences.

 

            The past three decades, from the 1980s onwards, has truly been the “mainstreaming” of wellness. In real terms, that means a larger numbers of Americans claim to be concerned about their “wellness” every year. Popular societal figures like celebrities, athletes, politicians and intellectuals espouse their own take on the wellness movement. Science is investigating claims into the benefits of wellness practices, attempting to find empirical evidence behind lifestyle choices. Of particular concern to us is the huge number of businesses, both small and large, that have emerged to both create and serve the wellness community.

 

What Exactly Is Wellness?

 

The long history of the wellness idea demonstrates that there is no singular take on what living “well” means. In fact, the very idea of wellness, some would argue, runs against the idea that there is one, all-encompassing definition of wellness. However, because the historical narrative of wellness is so long, it allows us to identify several themes that are constant in the story arc of wellbeing.

 

  • Wellness is multidimensional

Most of the leading definitions of wellness incorporate anywhere from 2-14 or more dimensions, which frequently include physical, social, emotional, mental, spiritual, and logical aspects

  • Wellness is holistic

This aspect of wellness implies the multidimensional charateristics mentioned above. Specifically, holistic wellness refers to the state of being where all parts of your body, mind and spirit are working in tandem with each other, as opposed to disparate systems that operate independently. Moreover, holistic wellbeing is NOT a simple absence of disesase.

  • Wellness changes over time and along a continuum

What exactly wellness means will change with a person over time. In other words, it is not a static endpoint, where one can be “finished” with wellness. Optimum levels of wellness will change according to age, social context, and prevailing social and scientific norms.

  • Wellness is individual but also influenced by the environment

Because scientific progress changes our conceptions of health, and because social norms dictate what is deemed acceptable, wellness is an interactions between an individual’s desire and the structure of the environment

  • Wellness is a self-responsibility

Fundamentally, though, wellness is an obligation that each individual takes on his/her own. This incorporates an important facet about wellness: being proactive. Hence, it is an individual’s ultimate responsibility to stave off sickness by engaging in wellness.

 

Beyond these large themes, the World Health Organization is attempting to incorporate all the variables identified above. They define health as the following: “A state of complete, physical, mental and social well-being and not merely the absences of disease or infirmity.”

 

A survey of industry actors and consumers also shows certain themes reoccur in people’s perception of wellness. 319 industry members and 1,077 consumers were asked to define wellness and attribute phrases/words to the concepts.  The most common responses are listed below:

 

      • Quality of life
      • Physical fitness
      • Happiness
      • Balance
      • Relaxation
      • Emotional balance
      • Stress reduction

 

 

 

Proactive vs. Reactive

 

            A great way to understand wellness is to categorize activities along a proactive and reactive divide.  The dichotomy helps us differentiate practices along the entire spectrum of wellness. For example, within the context of physical health, an intensive antibiotic regime is markedly different than regular physical exercise. While the former is a treatment for a specific disease, the latter is an activity without a singular outcome. Within the context of spiritual health, the Catholic practice of confession is reactive, whereas praying to a particular Saint is proactive. Ultimately, reactive practices are responding to a certain negative outcome in the body, mind or spirit. Proactive practices aim to create and foster wellbeing, before any negative outcome; specifically, they aim to generate more positive outcomes, instead of simply avoiding negative states.

 

            The greatest difference between proactive and reactive approaches to wellness is the degree of autonomy the individual has in each state. A sick patient receiving treatment is obligated, if she’s a rational being seeking to optimize her living condition, to improve the state of her health. But physical exercise is entirely voluntary. What truly characterizes wellness is making an active decision to improve one’s life, and following through on the respective behavioral changes.

 

            The proactive/reactive divide is crucial in categorizing certain business into or out of the wellness industry. “Sickness” oriented institutions like hospitals and rehabilitation centers fall outside of the wellness spectrum and into the “reactive” category. Spas, medical tourism, beauty and anti-aging companies fall in the “proactive” category, and ultimate, form a part of the wellness industry.

 

The Wellness Industry

 

 

A Wide Variety

 

            Since definitions of wellness are so broad, the industries that fall within the wellness category are accordingly varied as well. A 2012 McKinsey report finds 6 distinct categories within the wellness industry.

                       

  1. Functional nutrition
  2. Personal healthcare
  3. Beauty
  4. Hygiene
  5. Consumer devices
  6. Services/information

 

 

 

 

The Stanford Research Institute posits the industry along the proactive/reactive divide. They highlight 9 distinct industries, as seen below.

 

Figure 1

 

 

 

 

 

A Huge Market

 

Unfortunately, due to the extreme variety of goods and services encompassed within the wellness industry, there are only estimates about the true size of the entire global market.  The Stanford Research Institute conservatively estimates that “wellness cluster” represents a market of nearly $2 trillion globally, as of 2010.[1] Data collator, Statista, claims that the industry is valued at $1.94 trillion, confirming SRI’s claim.[2]  The value breakdown of sub-sectors can be seen in the figure below.

 

 

 

 

 

Figure 2

 

 

 

 

 

Big, yet Still Growing

 

            Even though the market is already huge, Euromonitor International predicted that the industry added an additional $27 billion in value in 2013.[3] In 2017, global health and wellness sales alone are expected to generate a record breaking $1 trillion.

 

Much of this growth stems from the rising levels of disposable income in developing nations. China alone, in 2011, added $10 billion in sales, the equivalent of 25% of global absolute growth. In 2006, the average Chinese spent only $60 on health and wellness but between 2006-2015, average annual spending on wellness will rise more than 13%. Sales in Venezuela and Argentina grew by 36% and 25% in 2012. Between 2012-2017, China and Brazil alone are expected to add $103 billion in new sales to the wellness market. In India, the number of people making above $4,400, an income point where they start spending beyond necessities, has almost tripled in the last decade to 28.4 million people.

 

Figure 3

 

 

 

 

 

 

 

Sources of Growth: Market Forces

 

There are several market dynamics that are driving the growth in the wellness industry.

 

  1. Disposable Incomes

 

Simply put, as incomes rise in the BRICS and other middle-income countries, populations shift from survival spending to luxury spending. This explains why much of the growth in the industry comes from developing nations, as seen in Figure 3.

 

  1. Aging populations

 

Global population over 60 is growing twice as fast as the total overall population. The world median age was 25 in 1960; it’s expected to be close to 40 by 2050, according to the UN. The number of people over 70 is expected to increase from 269 million (in 2000) to 1 billion by 2050. As populations get older, they place more importance on spending for wellness.

 

  1. Failing Medical Systems

 

Globally, indicators suggest that medical systems are failing to keep up with aging populations. People pay more for care, wait longer for it, and spend more of their emotional energy worrying about wellness. In 2002, the cumulative health spending within OECD countries was $2.7 trillion; this is expected to triple to more than $10 trillion by 2020.

 

 

 

Sources of Growth: Social Forces

 

Beyond the structural forces that drive consumers to the wellness market, there are social forces that also pressure consumers into the wellness sector.

 

  1. Consumers are more knowledgeable

 

  • The internet provides a wealth of health information
  • 96% of American adults who’ve used the internet have used it to look up health information
  • More than half of the French regularly purchase health/beauty products online
  • About 70% of the Chinese research the Web before purchasing
  • More than that, they realize that name brands often aren’t worth the huge dollar
    • 17% of consumers traded down to off the counter and brand generic health and beauty goods
    • A majority of them noted that the less expensive brand was better than expected
  • The prevalence of information informs consumers about they myriad of benefits derived from a wellness lifestyle; this puts further pressure on consumers to continue spending

 

 

  1. Wellness is individualistic, and personable

 

  • Due to the historical nature of wellbeing, each person is seen as responsible for their own wellness
  •  The western ethos of social living, which dictates that “each person takes care of their own” obligates consumer to define their own conception of wellbeing
  • This personal definition leads some consumers to buy into the wellness industry

 

  1. Wellness is seen as high status

 

  • Generally, populations with lower incomes are less healthy than populations with relatively higher levels of income. Health outcomes are strongly correlated with income levels.
  • Because healthcare spending is so high, only wealthy populations are able to afford all of the aspects of wellness, beyond survival care
  • Thus, wellness, and overall health, is seen as a socially desirable indicator
  • Populations, both within the developed world and developing countries, strive to attain this higher social status, and thus buy into the wellness industry

 

 

 

In conclusion, it appears that the wellness industry is here to stay, for decades to come. But it will not remain static. As larger numbers of people demand more healthcare, and alternative sources of wellbeing, the industry will respond by creating new products and services to cater to demand. Both large corporations like Pepsi will launch product campaigns that spans the globe, while smaller startups envision and pioneer completely innovative approaches to wellness. While humanity continually searches for better ways to live, it is apt to note how far we have come. Health indicators are rising for millions of people in the developing world. Meanwhile, developed countries are beginning to understand the importance of holistic wellness in the 21st century. Perhaps our world will one day, be entirely well.  

[1] The overall cluster of sub-sector market sizes were extrapolated from consumer spending and industry size data from a wide variety of secondary reports and sources. Key sources include: Market and markets, Euromonitor, PWC, Deloitte, Global Industry Analysts, Nutrition Business Journal.

[2] “Wellness Industry: Global Market Size by Segment | Statistic.” Statista. Accessed April 23, 2014. http://www.statista.com/statistics/270720/market-size-of-the-wellness-industry-by-segment/.

[3] “Health & Wellness to Grow by $27 Billion in 2013: Key Research Highlights.” Nutraceuticals World. Accessed April 23, 2014. http://www.nutraceuticalsworld.com/blog/marketwatch/2013-01-10/health-wellness-to-grow-by-27-billion-in-2013-key-research-highlights.

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