One year into the COVID-19 pandemic, we can see numerous changes in consumer behaviour and priorities. Change and uncertainty have prompted people to take a more holistic approach to their overall well-being, factoring in what makes them feel happy and healthy.
There has also been a collective realisation around excess weight and associated health conditions, and their link to increased risk of the effects of COVID-19 and other serious illnesses.
As health and lifestyle awareness grows and people make real shifts in their behaviour, the wellness market is expanding. Market activity is expected to heat up in nutrition and fitness, highlighting the population’s increasing attention to preventive measures which help boost the immune system and improve well-being.
The shifts in consumer habits during the pandemic have prompted renewed growth of the global health and wellness food market, valued at more than US$764 billion in 2020 and now projected to reach a US$1.1 trillion by 2027, according to a recent market analysis.
Even before the pandemic hit, people were becoming increasingly conscious of health and weight management: in 2019, the fitness industry was worth $100 billion globally. The arrival of COVID-19 accelerated this trend but brought its own challenges. A few months ago, we talked about the need for the fitness market to find ways to reinvent itself as gyms were forced to close.
Along these lines, consumers are taking more control of their workout routines: the global fitness app market size is predicted to reach the USD 15.96 billion mark by 2026, showing that people are keen to find tools to facilitate a healthier lifestyle.
Changing habits and embracing new lifestyle choices
- Healthy eating, nutrition and weight management: The pandemic shed light on the need for healthier eating habits and improved knowledge around nutrition. There is also a growing interest in ‘superfoods’, those foods that have high nutrition values.
- Natural medicines and vitamin supplements: Along with a healthy diet, many health conditions can be treated with natural products.
- Fitness and activity routines: When gyms closed during lockdowns, people turned to hiking, family walks and home workouts.
- Mental health: Limited to home, some alone and away from loved ones, many people realised the importance of mental well-being. Activities like walking, gardening, baking and meditating have become more popular.
As the wellness market seems set to be a main driver of growth over the next few years, investors and market watchers should be looking into the following stocks as the best positioned to perform well in 2021:
- In the nutrition space: Weight Watchers (WW) and Medifast (MED)
Weight Watchers International (WW): Despite being a veteran player in the nutrition space, Weight Watchers has managed to successfully adapt to and navigate the pandemic-imposed changes. Its business model has become increasingly more digital and consumer oriented, showing the company’s willingness to keep up with shifting consumer preferences.
Medifast (MED): Much like Weight Watchers, Medifast offers nutrition plans. Its signature solution is Optavia, a health and nutrition system covering various aspects such as sleep quality, mental health, and hydration. Its comprehensive approach is a strong selling point, particularly in the face of a pandemic.
- In the fitness space: Peloton (PTON), Nike (NKE), Lululemon (LULU)
Peloton (PTON): Without a doubt one of 2020’s big winners, Peloton is now the largest interactive fitness platform in the world. The company’s shares went up more than 400% last year and it now serves around 15 million households. Along with home workout equipment, Peloton offers online classes, like spinning, which became hugely popular during lockdowns. The question with Peloton, though, as some market analysts point out, is that the company could now be overvalued.
Nike (NKE): Last December, Nike shares hit an all-time high in response to the company’s better-than-expected results in 2020. Market analysts said Nike’s increased revenue in this period was largely due to its success in the e-commerce space and demand for athletic wear during the pandemic.
Lululemon (LULU): The famous sportswear brand had impressive results in 2020, with more $1.1 billion revenue in Q3 2020. The increase can be attributed to consumer demand for more comfortable and flexible clothing, as well as the company’s investment in its e-commerce platform, which allowed Lululemon to expand sales in new markets beyond the US, such as the UK and Europe.
Check out the stocks’ performances on ADVFN:
Weight Watchers -WW International- (WW): https://ih.advfn.com/stock-market/NAS...
Medifast Inc (MED): https://ih.advfn.com/stock-market/NYS...
Peloton Interactive (PTON): https://ih.advfn.com/stock-market/NAS...
Nike (NKE): https://ih.advfn.com/stock-market/NYS...
Lululemon Athletica (LULU): https://ih.advfn.com/stock-market/NAS...
Watch our director Stefania Barbaglio talk about wellness market trends in an interview with Investor Hub:
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