Mental Wellness Now A $121 Billion Market

The Global Wellness Institute delivers first research report to define, analyse and size the global mental wellness economy
The report highlights four key sub-markets based on global consumer spending in 2019 that amount to $120.8 billion – a pre-COVID baseline on which to anticipate the future
The GWI report identifies several key areas of opportunity, in particular for mental wellness tech startups, where investment has seen a five-fold increase since 2014
“We hope this study clarifies how important it is to promote mental wellness – and how businesses, governments and individuals can all play different roles in addressing a growing crisis,” said Katherine Johnston, GWI senior research fellow

FLORIDA, United States — The global wellness economy can now add mental wellness, a rapidly expanding $121 billion market, to its $4.5 trillion overall valuation, according to the Global Wellness Institute.

The GWI, a nonprofit global research resource for the wellness industry, revealed this new “industry bubble” at its annual Global Wellness Summit in Florida this month.

Since 2014 the GWI has measured the size of the wellness economy worldwide, most recently identifying ten leading industries, last estimated at a value of $4.5 trillion in 2017/2018.

These include personal care, beauty and anti-ageing, valued at $1,083 billion, wellness tourism ($639 billion) and workplace wellness ($48 billion).

Distinct from mental health, the GWI defined mental wellness, its 11th industry bubble, as “an internal resource that helps us think, feel, connect, and function” and “an active process that helps us to build resilience, grow and flourish”.

Four sub-markets of mental wellness
In the report, Defining the Mental Wellness Economy, the GWI identified four key sub-segments that make up new mental wellness category, based on consumer spend:

Sense, spaces and sleep ($49.5 billion)
The largest mental wellness sector, this category covers the exploding array of sleep-optimising solutions, from wearables and stress toys to multisensory experiences such as nap cafes, forest bathing and circadian lighting.

Brain-boosting nutraceuticals and botanicals ($34.8 billion)
This category notably includes the rise of plant-based drugs used for mental wellness, such as CBD, functional mushrooms and psilocybin, which has undergone a rapid acceleration in clinical research.

Self-improvement ($33.6 billion)
This category ranges from self-help tuition delivered by life coaches or organisations via workshops or retreats to brain training services and online platforms combating loneliness and isolation.

A growing sector within this sub-market could be seen with the recent rise of “relationship wellness” platforms and tools, such as Paired, Lasting and Relish.

Meditation and mindfulness ($2.9 billion)
The smallest category identified by the GWI covers breathwork, retreats, apps, journals and wearables, many of which build upon biofeedback and virtual reality technologies. The GWI noted that while millions practise meditation, only a small fraction spend money on it.

A blurring of lines between these last two sub-markets could also be seen with the recent partnership between dating app Hinge and meditation app Headspace.

A pre-COVID Baseline
The report’s authors were keen to stress that the mental wellness industry figures estimate the size of the 2019 market, and should serve as a baseline pre-COVID on which to anticipate the future.

They also emphasised that although the COVID-19 pandemic has accelerated the deterioration of our collective wellbeing and exposed the wide gap between mental health needs and mental health resources, “mental unwellness has been a growing public health crisis for some time”.

The GWI’s research highlighted how over 15% of the global population suffers from mental and substance use disorders; dementia is on the rise; happiness is on the decline in many countries; and stress, worry, sadness, burnout, and loneliness are increasing all around the world.

However, according to the GWI, mental wellness offers a path forward.

“A stronger focus on mental wellness has been a cultural mega-shift these last few years: people awakening to the importance of integrative solutions including meditation, sleep and brain health, with businesses rushing in to offer all kinds of solutions,” said Ophelia Yeung, GWI senior research fellow.

“While most mental wellness strategies are free – like spending time in nature or with friends – people increasingly seek non-clinical help in coping with everyday mental challenges, and that’s where the mental wellness industry comes in.”

Katherine Johnston, GWI senior research fellow, added: “There is urgency to this research: study after study shows how the human suffering and economic dislocations caused by the pandemic have ravaged our mental wellbeing.

“We’re excited to release this study because people are desperate for alternative strategies to cope, and we hope it clarifies how important it is to promote mental wellness – and how businesses, governments and individuals can all play different roles in addressing a growing crisis.”

Post-pandemic opportunities
Although the industry is just starting to adapt to the global upheaval unleashed by COVID-19, the GWI report identified several key areas of opportunity within the burgeoning sector of mental wellness.

The report noted how companies delivering virtual solutions, home entertainment and vitamins and supplements have all reported an upswing in demand during the pandemic.

It highlighted how evidence is growing to support the adoption of self-care practices, such as meditation, light therapy, and circadian science, bolstered by an acceleration of public and private research investment.

Further relaxation of regulation around brain-boosting nutraceuticals could mean plant-based psychedelic drugs will be increasingly used for both mental wellness and clinical treatment purposes.

And mental health and mental wellness tech startups have also become a major target for investors, the GWI found. Investment levels reached $750 million in 2019, a five-fold increase over 2014, while funding has topped $1 billion in the first half of 2020.

Notable winners have been meditation and sleep apps Headspace, which in June added $47.7 million to its earlier $93 million raise in February, and Calm, which is targeting investment that would double its valuation to $2.2 billion.

“These figures indicate that the perceived growth potential of this segment is huge,” read the GWI report. “An important development is the merging of traditional mental health solutions with mental wellness technology platforms to provide preventive and supplemental care.

“Some businesses may be seeking to access the resources of a much larger healthcare market, beyond consumer discretionary spending on mental wellness.”

Examples of this can be seen with the rise of telehealth and teletherapy startups, such as California-based Lyra Health, which hit a $1.1 billion valuation in August, that are helping plug gaps in traditional public healthcare services.

Financial risks and fragmented regulation
Despite the optimism, the GWI did caveat its report with a word of caution for this emerging field of mental wellness.

“Since disposable income and consumer confidence have taken a severe hit worldwide, consumer spending is shrinking across many industries. The pandemic has also accelerated the global trend of polarisation and concentration of income and wealth,” the report read.

“Therefore, future opportunities will depend upon how a business provides value to its targeted consumer segment, such as luxury versus mass market.”

The report also noted that, for the brain-boosting nutraceuticals and botanicals sub-market in particular, mental wellness practices and products have not yet accumulated extensive clinical evidence when compared to the conventional medical and mental health industries.

“The regulation of most mental wellness businesses is fragmented, and it is generally left to consumers to determine whether they believe in and find benefit from them or not,” the report concluded.

The GWI intends to update its valuation of the global wellness economy in 2021. The findings will undoubtedly shed more light on an industry that has been both ravaged and revolutionised over the past few months.