COVID-19 recovery, political instability, soaring inflation — the business landscape is changing at a rapid pace. So, what does the future hold?
MINDBODY, business software solutions for the fitness, wellness, and beauty industries, went straight to the source and asked consumers and leaders of top wellness brands to answer that question. While their perspectives varied, they shared a common thread of optimism. Even in the face of complexity, they agree that the opportunities for growth and impact are endless.
Prediction: IRL is back and here to stay
Consumers are all-in on in-person as they book in-person experiences at rates that, in some areas, surpass pre-pandemic levels. In February 2022, the ClassPass platform saw the most reservations since February 2020 with users booking at 10% higher rates than pre-pandemic times. Mindbody data reveals that 82% of Mindbody app users are utilizing the platform exclusively for in-person bookings, while just 14% are seeking virtual offerings.
For those participating in virtual fitness, those classes can serve as a great feeder to in-person experiences. 35% of Americans started going to an in-person fitness class they discovered through virtual fitness.
This flock back to in-person experiences presents growth opportunities for the wellness industry. Almost a third of Mindbody fitness customers plan to expand their business into more locations in the next by December 2022. Additionally, those who have accepted funding through the Mindbody Capital offering report most commonly using the funds for payroll and hiring, new equipment, and expansion-related expenses.
And for those hybrid workers who may have cut down their trips to the office—hybrid fitness and wellness routines are also here to stay. Over 70% of professionals are dropping by fitness studios on the days they work from home and professionals are twice as likely to try out a new studio or fitness class - the perfect break after working in a home office all day.
Prediction: The metaverse will expand
Streaming workouts were once seen as the wave of the future. Today, an immersive gamification of the fitness industry is underway. The adoption of augmented reality (AR) and virtual reality (VR) will continue to grow at a rapid pace. In fact, researchers predict growth of more than $125 billion globally by 2024. And, with 23% of American consumers already exercising with a virtual reality app, leading fitness brands, like TRIB3, are jumping on board the opportunity. Additionally, 32% are excited about AI’s ability to look at fitness personal data via apps or other technology and provide personalized suggestions.
Gymtimidation plays a factor in those who haven’t made their way back to the gym with 55% of Americans who aren't currently going to a gym or studio say getting in better shape first would make them less intimidated. Many Americans are using AR/VR equipment to get in shape at home as the gamification of exercise makes working out fun, easy and appealing. AR/VR workouts can break down barriers to in-person experiences by allowing people to up their fitness level at home before joining a gym or studio.
Chief Creative Soul of Good Soul Hunting Emma Barry is excited about the future of AR/VR. “Right now, [the technology] is clunky. It's a little bit scary. And we keep hearing how everyone's worried they're going to pop in and never come out again, but television was the same when it was introduced,” Barry claims. “Is it going away? No, because it's the continuum of the evolution of the internet. It's going to be the meeting place for all realities and it's going to create quite an intoxicating environment.”
Prediction: Personalization will be an expectation
In 2023, personalization will be increasingly important. According to a recent McKinsey report, over 70% of consumers expect to have personalized interactions with brands they invest in, and over three-quarters get frustrated when they don’t.
In the wellness industry, a personalized approach is perhaps even more important. A second McKinsey report shows consumers are increasingly willing to give their personal data to receive more personalized wellness treatments and services.
For wellness brands like The Hydration Room, a personal approach is nothing new. “Personalization has been the driving force behind our business strategy since day one. Our health and wellness are inherently individual. What is going to work for you might not always be the case for anyone else. With personalization and customization, you receive a much more engaged customer: one who visits weekly, is eager to try new services, and becomes a champion of your brand online and in-person,” claims founder and CEO Dr. Brett Florie. “Of course, this all leads back to customer service—making sure you have dedicated employees who are willing to put in the time to educate your customers. That will always yield a reward.”
In the years ahead, [solidcore] will also continue to prioritize personalization. “Personalization, in order to help clients achieve results, is more than a business strategy—it is a business imperative. Without it, clients are apt to move on until they find someone willing to help them lay out a roadmap more clearly and personally,” explains President and CEO Bryan Myers.
Myers suggests leveraging artificial intelligence to help customers achieve their goals more effectively. “Wellness brands should start to think of how they can 'Netflix-ize' or ‘Tik Tok-ize' their consumer journey and experience, leveraging data and AI algorithms to proactively suggest how clients should interact with their service (or product) based on a user's stated wellness goals and their ongoing behavior,” he shares. “This type of tailored and personalized experience will help clients achieve their goals more quickly and consistently while also driving retention and revenue for the business.”
Businesses can use the information gathered through these algorithms to implement dynamic pricing.
With personalization, however, comes concerns about privacy. Although consumers want personalized experiences, they may object to their data being collected. “With that, what I believe is important is that users have transparent visibility into what data is being collected, when, and how it's being used. They should have the opportunity to opt in or out of the experience based on their personal level of comfort,” Myers suggests.
Prediction: Company culture will be more important than ever
Today’s employment market is unique and difficult for organizations to navigate. According to a recent study by Frandata and IFA, nearly 90% of respondents reported franchisees are having trouble finding skilled workers, unskilled workers, or both. Another staggering figure: A recent McKinsey article claims 40% of employees are likely to leave their current job in the next three to six months.
Why the significant transition? “[During the pandemic], people had a really good look in the mirror, and they reprioritized,” according to Good Soul Hunting Chief Soul Officer Emma Barry. “It's not all about the dollar anymore. People want to know they matter.”
So, what can brands do to attract and retain high-quality talent in 2023? New research shows flexibility and company culture will be increasingly important. When looking at potential new employers, 42% say that wellness perks/benefits (corporate wellness programs) are an important part of their decision when making their final decision.
Additionally, 40% say corporate wellness programs motivate them to prioritize wellness more, which can help prevent burnout—something all too common these days.
The definition of wellness is changing. People experience wellness in different ways. One person might want to unwind with a calming yoga class or a massage, one person might unwind by getting their nails done, another might prefer to hit a sweat-inducing class. Wellness encompasses physical health, mental health, spiritual health, and more. In fact, 24% of Mindbody app users said they are likely to occasionally splurge on treatments including massages, infrared saunas, and nutritional health coaching to support their overall wellness routine. “The reality is, if you don't focus on having a positive culture, you're not going to retain employees,” says The Lash Lounge Vice President of Operations Kristin Kidd. “The workforce has changed and if you don't change with it, you're not going to have a business that can grow.”
By offering diverse, well-rounded programs, 88% of professionals say they're more likely to recommend a workplace that supports their wellbeing.
For Mark Schlossberg, CEO and co-founder of PAINT Nail Bar, his company culture is staff-centric. “The client never comes first, nor should they come first. The staff comes first,” he says. “The staff is the heartbeat of the business—and it begins with the first interview. We differentiate ourselves by making clear exactly how we view their role and [reiterating] that they are foundational to the success of all that we do.”
To retain top talent, Schlossberg emphasizes PAINT Nail Bar’s onboarding process and employee benefits. “We over-train, over-support, and over-empower them without condition. Their families and children are equally important to ours. Our staff members know they are our priority, above all else. We make readily available to them opportunities for growth, fully paid time off, and an unlimited vacation policy.”
Similarly, Vanessa Yakobson, CEO of Blo Blow Dry Bar, knows the value of investing in her team with continuing education and fair compensation. “Blo has a brand promise: We’re here to make you shine. We deliver that promise to our guests as well as to our staff,” she shares. “We are focusing on creating opportunities for our team members to enhance their skill sets as Blo adds services to our mix. We also offer the opportunity to sell products and upgraded services to enhance their earnings.” Yakobson’s ultimate goal: “We want our team to shine in a fun environment where they feel valued and appreciated.”
Prediction: Consumers will continue to seek more from their wellness experiences
Consumers are more focused on wellness than ever and are expanding their definition of wellness to encompass a whole lot more than just being in shape. This is likely to be a lasting effect of the pandemic, as Americans share the pandemic has negatively affected their mental (49%) and physical health (40%). These days, wellness means reducing stress, feeling confident, and finding a sense of community and belonging. It spans mental, physical, and spiritual dimensions—and, according to recent Mindbody research, consumers in the US, UK, and Australia are all prioritizing mental wellness above all other facets of wellness.
Motivations for movement have shifted, too. Pre-pandemic, the top reasons consumers exercised were to control weight and to feel good. Today, consumers say they exercise to reduce stress and feel better mentally. In 2023, fitness and wellness brands with staying power will tap into these deeper motivations and expand their services to better support the mind-body connection.
86% of Mindbody app consumers exercise 3x a week or more. There is also a notable rise in those who walk outdoors (33% in 2021 to 71% in 2022). Weight training and yoga continue to rank among the top three, with hiking and HIIT rounding out the top five.
There is an opportunity in the market for businesses to expand their offerings to accommodate this consumer shift and offer all-around wellness experiences.
For EXOS, providing an integrated approach to help clients achieve their goals is nothing new. “This has been core to EXOS since 1999. In fact, it was a founding promise we made to break down walls between practitioners and various domains to support the whole human toward the achievement of their meaningful goals,” says Senior VP/Head of Performance Innovation Emily Carlson-Phillips.
The EXOS leadership team recognizes a shift happening in the industry. “A holistic approach to wellness is being adopted by many of the players in the market today, often starting in one domain of service and slowly expanding to the next. Companies want to drive long-term engagement and impact, the challenge being that new services and offerings don’t simply pile on each other with more to do for the member. They must be thoughtfully integrated and considerate of the member’s experience,” Carlson-Phillips says. “The services, plans, and coaching should complement, not compete, with each other—all working together to move the member more efficiently toward the outcomes they’re striving for.”
Carlson-Phillips' advice for brands looking to expand their offerings in the future? “The studios that will win will help individuals make sense of the broader array of the types of modalities that we know are critical to long-term success,” she shares. “When expanding offerings, we need to connect back to a central methodology that’s delivered by experts who are steeped in and evolving that methodology. If this isn’t the case, the member is presented with further randomness and a high potential for confusion.”
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