The Australia Report: Wellness Trends, Growth and Market Opportunities

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With 15 percent of Australian adults gym members and some 20,000 employed in the fitness industry alone, the country’s mature wellness market provides a fertile breeding ground for industry innovations.

Some 44 percent of Australian consumers avoid sugar when making food purchasing decisions, according to Nielsen’s 2016 Global Health and Ingredient Sentiment Survey – 10 percentage points higher than the global average, while new research from Euromonitor points to 12 percent growth in the food intolerance category in 2015. Sales of almond milk alone almost doubled over the course of a decade.

“Australians are quick to pick up on trends, particularly those that start online. This comes from our outward-looking focus,” explains ‘I Quit Sugar’ founder Sarah Wilson, whose company was born out of a decision to give up sugar in 2011.  

“The Australian consumer is 3-4 years ahead of the UK consumer, and fruit juice is regarded as added sugar by many. With clean eating, we had the backlash that is now spreading across the UK a few years ago. But the pendulum appears to have swung back to a more reasonable, practical approach – Australians are embracing the notion of simply eating real food, ” Wilson adds.

To meet the needs of increasingly sophisticated consumers, subscription delivery services are booming, as a way of scaling rapidly across the country. Founded by Peta Schulman in 2014, health food sampling business GoodnessMe Box was able to achieve revenue of $1m AUD in its first year, a testament to Australians’ enthusiasm for the sector.

GoodnessMe Box

Image: GoodnessMe Box

Beauty subscription boxes in Australia were doing well and I began to research the health food box subscription industry,” Schulman tells Welltodo. “Being a publicist in the health and wellness space for five years I could feel the health industry was on the cusp of booming.”

“Since then, the health food delivery space has exploded in Australia whether it is for packaged products to sample or fresh whole ingredients with recipes to cook meals,” Shulman adds.

“Health box subscription services are disrupting the way health businesses are seen and heard, providing a cost-effective platform for brand awareness and growth.”

With subscription-based business models showing no sign of running out of steam, November 2016 saw the launch of The Brkfst Box, an even more niche monthly delivery of muesli, granola and porridge portions, which founder Leanne Roberts hopes will “nourish and support women by fuelling them daily, coming alongside them in the daily tornado of life to set them up for a win and keep unhealthy cycles at bay.”

The biggest challenge for brands in the healthy food sector is scaling in response to such enthusiastic demand, according to Schulman, who explains: “Within a couple of months [of launching], I found myself having to manage a growing team, thousands of customers, multiple suppliers, logistical relationships and internal systems and processes.”

This demand for healthy food solutions is not limited to women, according to Wilson. “Surf culture has always been associated with eating well and this, regardless of whether you live by the beach, defines Australian masculinity in many ways,” she explains, pointing out that many members of the country’s cricket team gave up sugar the year they won the Ashes. The I Quit Sugar founder currently has more young male followers across her social media channels than females in the 12-20 category.

One startup eager to make the most of the opportunities for male-focused wellness, which goes beyond the healthy eating segment, is young athleisure brand Biink, which launched in April 2016.

Biink activewear

Image: Biink

“As owners and operators within the gym industry, we strongly believed that the men’s market had been overlooked for sometime,” argues co-founder Joe Chagoury. “It became very clear women were spoilt for choice, whereas men were somewhat lost.”

The startup joins an array of cult Australian workout brands increasing in international prominence including ‘Swim & Gym’ label We Are Handsome, stocked by Net-a-Porter, and P.E Nation, which British consumers can find in Selfridges.

Their international expansion follows the explosion of Australian fitness brands onto the global stage in recent years, with Kayla Itsines’ $48m AUD workout app empire boasting 25 million users around the world. The Bikini Body Guide is just the tip of the iceberg when it comes to the country’s sector influence. Starting with a single studio in Sydney in 2012, F45 has quickly become the world’s fastest-growing workout franchise, with 450 locations in 18 countries, while books by nutritional biochemist Dr. Libby have been international bestsellers.

And, if the Australian market is a barometer for bubbling trends, then it seems likely that brands in the US and Europe with an existing passion for wellness events will soon be further embracing the diverse range of health-driven occasions developed there.  

Schulman sees large-scale consumer events such as GoodnessMe Box wholefood markets in Sydney as a natural evolution of her company’s mission to “get the word out there about these incredible products and change the consumer’s food choices.”

They join a spate of high-profile wellness festivals which have sprung up across the country in recent years, including the MindBodySpirit Festival and ‘Colour & Coconuts’ Wellness Festival, dubbed “the Coachella of the health world”. Both have so far spread across Melbourne, Brisbane and Sydney, though their international influence is yet to be felt.

The tie-up between Colour & Coconuts and accommodation partner Bondi Yoga House during the October 2016 festival points to the next big growth opportunity in the Australian market: wellness tourism. Boosted by pro-wellness consumer sentiment as well as an aging population, the industry is growing almost 50 percent faster than conventional travel, and is set to be worth more than $700bn by the end of 2017, according to research carried out by Global Health and Wellness Summit in 2013.

Notable established wellness destinations include the Gwinganna Lifestyle Retreat on the Gold Coast and Billabong eco-friendly yoga resort near Sydney, and with wellness tourists spending 65 percent more than other foreign visitors to the country, the prospects for new and existing brands to capitalise on Australia’s growing wellness reputation are vast.

Going forward, success for UK and US players looking to penetrate the Australian market rests on truly disruptive ideas, marketing strategy, and product innovation. Whether that manifests through clever brand collaborations, retail partnerships, destination-led experiences, or infusing technology and science with wellness; demand is high, but businesses must create innovative ways to leverage it.

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