COVID-19 pandemic has had a profound impact on the wellness/mindfulness technology industry in the United States. Besides the increased interest in wellness technologies, the pandemic has also increased competition in the industry, attracted investment, nurtured revenue growth. The detailed coverage of the impacts is presented below.
1. Increased Interest
- COVID-19 pandemic has radically increased the interest in wellness technologies and accelerated their adoption. According to Accenture, wearable technology use had gone down from 33% to 18% in 2018. Nonetheless, events that have occurred in 2020, especially COVID-19, have increased adoption, triggered interest in wearables, and forced reevaluation of wellness technologies.
- The rising interest in such technologies has also prompted technology giants such as Google, Apple, and Amazon to come up with smarter and more adept wellness technologies.
- Research shows that the pandemic has mainly influenced wellness technology products designed specifically for women.
2. Increased Investment
- The increased interest has also attracted the interest of investors amid COVID-19. The trend is evidenced by the rising venture capital in the industry. For instance, sources indicate that in the first half of 2020 in the United States, behavioral health technology raised $588 million in venture funding.
- Companies such as ClassPass have also experienced an uptick in valuations as investors bet on gym alternatives.
- Moreover, merger and acquisition and funding activities in the wellness technology have increased. For instance, Ergatta and Hydrow successfully conducted a funding round in June and July 2020 while Lululemon acquired Mirror $500 million in June 2020.
- COVID-19 has also led to increased partnerships between corporations and digital wellness providers. For instance, Oura, a wellness ring maker, partnered with the NBA.
3. Increased Competition
- COVID-19 pandemic has fast-tracked the adoption of wellness technologies among consumers in the US. Besides making the industry the hottest investment category, the new wave has heightened competition among new entrants and existing players.
- The pandemic has inspired renewed interest in wellness technologies, thus creating increased demand. For instance, over 300,000 digital health applications are available in the market currently, with about 200 being added daily.
- Thus, as companies rush to cut a niche in the booming market, the wellness industry is expected to get even more competitive during and after the pandemic.
4. Revenue growth
- COVID-19 has also led to increased revenue in the wellness technology industry as demand increases. Teleworking has prompted consumers to focus on home fitness, thus leading to increased demand for wellness technologies.
- Peloton is one of the companies in the industry experiencing soaring revenues. According to the company’s reports, its first quarter revenue rose by 66% compared to the same period in 2019.
- The revenue growth is also luring traditional brick-and-motor fitness firms to venture into the wellness technology industry. The overall effect is increased competition and availability of many wellness technologies.