Whether we want to admit it or not, we all have some degree of vanity that controls our day to day activities and lives. Some more than others, this vanity drives our spending and financial decisions to an extent as well.
What is interesting to review is spending on health and beauty even in times where many people are struggling to pay their mortgage like 2008 through 2011 still stays relative constant. Looking good possibly trumps putting a roof over our head or eating in some cases.
Recently, the market has been on an upswing and health and beauty have followed suit with a massive surge in growth across the board. This growth has translated to investment and innovation in technology, small business, franchising and other business markets. With Franchise Marketing Systems, we have the luxury of being able to see firsthand these trends and exciting market segments take shape. Certainly 2016 has been a great year for health and beauty and 2017 looks to continue that trend of experiential-driven growth.
What are the trends in health and beauty?
1. People want community. We saw this with the amazing advent of CrossFit. The volume of injuries seemed to those of us not in a program that this was just a bad idea, but people enjoyed intense workouts, positive physical results and most of all a community of people who all joined together to beat themselves up. This now is transitioning to a softer, more sustainable workout in Yoga. Possibly Tom Brady’s participation in yoga has helped, but the gains in this market segment are astounding with over $17 billion spent on yoga services and products in the U.S. during 2016 alone.
Again, there is this sense of community that the health and fitness segment haven’t had with your traditional gym in the past. In fact, I remember entire years at my gym where I never interacted with a single person, but in a yoga class people become family and truly indulge in relationships with one another. Franchise brands such as Purre Barre, SoulCycle and Orange Theory get this and have capitalized on the trend of community fitness.
2. People want natural. Never before in the history of food labels has there been so much attention to the ingredients in our food, vitamins, supplements and other “Stuff” we just ate in years past. Restaurants and food retailers are being forced by today’s knowledgeable consumer who asks the hard questions and spends good money on products that have organic, natural and healthy ingredients. Terms like “Farm to Table” are commonplace and the average 5 year old knows what a “GMO” is. If you are serving a food product or selling something people eat, it’s time to get organic and find ways to get rid of ingredients that people can’t pronounce with 14 letters in their name.
3. Everyone’s talking about Weed. You can’t pick up a magazine, go to a franchise show or watch the news without something coming up about Cannabis. Afterall, it probably is the most fun health subject to talk about. With more and more of America transitioning to a Weed-friendly business environment, the business community is going Cannabicrazy and opening businesses to serve this market as quickly as possible. A warning for weedpreneurs is that technically Cannabis is still a federally illegal drug which makes business practices tricky and cumbersome and potentially could land you in jail with a wrong move.
4. Medically Supervised Beauty is In. Whether it is medical weight loss, skin treatments, laser work, Skin Tightening or other procedures, more people are willing to pay for these things in a spa-like environment. With the out of control insurance world, this is very appealing to medical professionals who are looking for ways to add cash flow to shrinking practices. Businesses such as MediSpas, Weight Loss Centers and even I.V. bars have all made great headway as businesses and franchises throughout global marketplace.
The Advice
If you are in Health and Beauty, pay attention to the trends and be “in” with the current market trends. Unfortunately, health and beauty customers can also be a bit fickle and unpredictable. One diet may be all the rage one day and then totally out of favor the next, like what happened to the Atkins Diet? Be on top of research, pay attention to thought leaders in the industry and be willing to invest in new innovative technology.
Understand your customer and have messaging/branding that speaks to the right person the right way. Health and Beauty is a sensitive category and you as a business owner need to have empathy for the consumer to not only know what drives their demand and buying decisions, but also to speak with them in a way that they will listen. For example, don’t tell the housewife she is looking heavy and needs to workout ASAP. Pun intended, the “beauty” of the health and beauty market is that you have the liberty to really play with your brand message and get as creative as any business with allow. People generally are looking for you to strike an emotional chord in them, they want to be inspired and feel like they are part of something bigger.
Take for example Lulu Lemon’s manifesto to their customer; it is too long to restate here, but one line caught my attention: “A daily hit of athletic-induced endorphins gives you the power to make better decisions, helps you be at peace with yourself, and offsets stress.” Now if that doesn’t get you wanting to buy some tight yoga pants, I don’t know what will.
In the end, don’t get lost in the fluffy, fun ideas that tend to come with the health and beauty market. Continue to focus on bottom line profits, cash flow and revenue growth. Put a dollar figure on everything you are doing and plan to do, both revenue and expenses and make sure that there is profit behind every business decision you make.
Chris Conner is the President of Franchise Marketing Systems and has spent the last decade in the franchise industry working with several hundred different franchise systems in management, franchise sales and franchise development work. His experience ranges across all fields of franchise expertise with a focus in franchise marketing and franchise sales but includes work in franchise strategic planning, franchise research and franchise operations consulting.