How a holistic approach to wellness is driving innovation
The COVID-19 pandemic has altered the CPG retail landscape, driving unprecedented growth and transforming the industry as we know it. New product innovation has leveraged many existing trends, including self-care.
Consumer interest in health and wellness has been on the rise for more than a decade in part due to rising U.S. healthcare costs, and the effects of the COVID-19 pandemic significantly accelerated this shift. The pandemic had an enormous impact on consumer healthcare spending, with omnichannel sales reaching $93 billion in 2020. According to a recent IRI survey of Americans aged 17 or older, 1 in 3 people is doing more now than pre-pandemic to support their overall wellness.
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As health and wellness remain a top priority for many consumers in 2021 and beyond, an array of innovation opportunities will continue to emerge within the self-care sector. Retailers have a great opportunity to effectively position self-care products to shoppers as they seek to balance their physical, mental and emotional well-being.
Integrative Self-care Solutions
Consumers today have a broad understanding of wellness that encompasses an overall, holistic foundation for health. They have diverse needs, including managing stress and anxiety, improving sleep, supporting immune system health, improving energy, improving physical fitness, and improving mental clarity and focus. Across the store, they seek highly personalized solutions to address these needs.
Over the past year, consumers spent an additional $16 on healthcare products, resulting in a nearly $2 billion gain. Expanding on this growth will become increasingly challenging and will rely on innovation. As shoppers look for need-based benefits, they are increasingly open to trying new products. Reflecting changes that have occurred during the pandemic, areas ripe for product innovation include healthy options that support at-home work and fitness, increased meal consumption at home and new ways of celebrating.
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Areas Ripe for Innovation in Wellness
As consumers transition into a new normal, we expect several product categories like nutritional supplements, home care sanitization products and more to grow. Preventive health care and the mind-body connection will continue to be a main focus for many shoppers post-pandemic.
Supporting mental and emotional well-being is top of mind for many consumers, and sales of products designed to help this need are on the rise. According to a recent IRI survey, nearly all consumers agree that mental health is as important as physical health. Survey participants revealed a great desire for solutions and information about how to support mental and emotional health through vitamins, supplements, over-the-counter medications, food, beverages, home care and personal care products.
Digestive and gut health and plant-based eating are other top wellness trends, as consumers seek to strengthen immunity, increase metabolism, and lower stress and anxiety.
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IRI finds that consumers have an average of 6.6 health-and-wellness goals. By understanding the attributes that are truly important to consumers and targeting messaging to distinct consumer segments, retailers can implement meaningful product innovations designed to drive growth and support consumers on their wellness journeys. Connecting with consumers by effectively communicating product sustainability and origins builds trust with shoppers looking to fulfill their multifaceted self-care needs.
From a cleaner home to better sleep and strengthened immunity, many categories across CPG retail are being impacted by recent consumer behaviors and bring focus to the broad approach consumers have when it comes to self-care. Gaining insight into shopper habits and purchase drivers allows growth opportunities to come to light, paving the way for innovation and marketing initiatives to be individualized and precisely targeted.