Primary care, personal care, and prevention vs. cure: our health and wellness trends for 2023

With the end of January approaching, it’s just about time to put the dunnhumby crystal ball back in its protective case for another year. Yes, having covered everything from data science to media, our trends series for 2023 is coming to an end – and with it, our predictions for the year ahead.

Before we go, however, there’s one last set of educated guesses to make. Wrapping things up with his take on 2023 from a health and wellness perspective is Tom Block – dunnhumby’s Vice President and Practice Lead for Health & Wellness. Let’s see what Tom thinks could be coming down the track as the rest of the year plays out:

As I was thinking about this piece, I couldn’t help but let my mind drift back to 2021, and McKinsey’s excellent insights into the modern concept of wellbeing. As part of their look at the future of this $1.5tn industry[1], a few of the company’s partners singled out what they believe to be the “six dimensions of wellness” – an all-encompassing look at current consumer attitudes towards health.

The primary focus, according to McKinsey, is on betterment across the areas of health, fitness, nutrition, appearance, sleep and mindfulness. Included under each of those six overarching themes are the products and services that can help us achieve those goals – ranging from medical devices and telemedicine through to sleep trackers and athleisure.

To me, this says two things. Firstly, health and wellness is now a deeply diverse industry that has grown well beyond its original parameters. Secondly, this continuing evolution means that there’s an increasingly rich opportunity for retailers, one that allows them to engage with customers across a rapidly expanding range of touchpoints.

Realising that opportunity, of course, means doing so against an increasingly challenging economic backdrop. While they attempt to engage customers in some of the areas above, retailers also need to be acutely aware of the economic reality that many shoppers now find themselves in – with three factors in particular putting consumer spending under continued pressure:

• The lingering and far-reaching impact of Covid-19.
• Soaring inflation and the consequent increase in the cost of living.
• An impending (or, perhaps, already present) recession.

None of this is to say that the overall importance of health and wellness is at risk, of course. In support of their “six dimensions” work detailed above, McKinsey surveyed around 7,500 consumers across six countries. Of them, four in five (79%) said they believe that wellness is important, with almost half (42%) citing it as one of their top priorities[2]. And, at a general level, the market as a whole is still expected to enjoy a CAGR of 5% out to 2031[3].

What the economic outlook over the next year and beyond does mean, though, is that focus is essential. Retailers not only need to provide health and wellness solutions that genuinely resonate with customers, they need to execute on those solutions in relevant and context-sensitive ways. There’s now a knife-edge balance when it comes to engaging around health and wellness, and getting it right or wrong will have a significant impact on long term loyalty.

So, with that context established, let’s get to the trends themselves. For the sake of clarity, I’ve divided these into two categories: what I think is going to happen at a wider industry level, and some of the ways in which I expect retailers to respond.

What’s going to happen?

1. Primary care and clinical services will be a focal point for growth

The past few years have already seen extraordinary emphasis placed on the expansion of primary care offerings by many retailers. That’s only going to ramp up further in 2023, with those services seen as a key way of driving additional growth and loyalty opportunities.

Naturally, one of the main side effects of this continued push towards clinical services is that it will bring retailers into even greater competition with one another. I expect to see more acquisitions and integrations as a result, with retailers striving to differentiate their propositions; the recent purchase of home care platforms by CVS[4] and Walgreens[5] provides some early evidence of that intent.

 2. The “food as medicine” movement gathers pace

Prevention is better than cure, they say, and most people agree. In a study by Deloitte released late last year, almost 80% of consumers acknowledged that eating the right foods can help keep them healthy and prevent them from developing certain conditions[6]. The trick for retailers, of course, is being able to nudge shoppers towards healthier choices when disposable income is already under threat.

In one of our own studies, for instance, we found that the dynamics of healthy decision making aren’t always as simple as we might like them to be. More than a quarter of the 10,000 or so shoppers that we spoke to around the world said that, while they’d like to lead a healthier lifestyle, it’s simply too expensive to do so[7]. Bridging the gap between desire and ability could be critical in the year ahead.

3. Men’s personal care represents a major opportunity

Already a $31bn industry in 2021, the men’s personal care market is projected to see near-double digit growth on the road to 2030; Grand View Research puts the sector on track for 9.1% CAGR over the next seven years[8], testament to what could be a significant commercial prize for those prepared to chase it.

As with the primary care market, innovation and NPD will be key here. Retailers will need to develop more sophisticated and gender-specific personal care products, shampoos, conditioners, face masks, and peels amongst them. More than anything, that will rely on closer collaboration with suppliers, using a data-driven approach to the needs and behaviours of this growing segment.

4. Digital solutions become increasingly pervasive

With health and wellness representing such a solid growth opportunity, retailers will undoubtedly want to ensure that they have the right framework in place to ensure that customers stick with them for the duration. Loyalty programmes come into their own here, of course, and so too does customer data – providing the guiderails required to build non-transactional engagement strategies.

The result of that is likely to be the continued penetration of digital solutions into customer lives. Whether it’s retailer-developed trackers and apps, or simply digital hubs that allow shoppers to document their health and wellness journey, I expect to see a renewed focus on the tools and technologies that can bring customers and care providers closer together.

How will retailers respond?

In leaning in to the four trends above, I think we’ll see a rise in the following initiatives from retailers:

• Personalised wellness

Personalisation isn’t just about tailored comms and campaigns; done right, it’s also about product offerings developed specifically with the needs of different audience segments in mind. In line with the growing opportunity around men’s personal care, the onus will be on retailers to improve their understanding of customers’ evolving lifestyles.

• Influencer partnerships

Influencer-driven campaigns are already part and parcel of the grocery media landscape. While health and wellness might be a more challenging area to tackle with those kinds of partnerships, beauty, personal care, and fitness all offer latent potential.

• Increasingly sophisticated omnichannel solutions

As retailers push to develop a better understanding of their customers’ health and wellness needs, they’ll need to build out better and more seamless omnichannel experiences too. True relevance can only be achieved with a cohesive view of people’s habits, both online and off.

• Expanded product ranges that cover all dimensions of health

Let’s end where we began, and look back at those six dimensions of health and wellness. This market is no longer just about supplements, medicine, and beauty – if it ever was. Instead, it’s a multifaceted and expansive industry that needs to meet an array of customer needs. Broader, more personalised assortments are key, as is a commitment to customer-centric innovation.

dunnhumby can help with customer-centric solutions to help retailers stay ahead of these trends. Please get in touch for more information.

[1] Feeling good: The future of the $1.5 trillion wellness market – McKinsey, 8^th April 2021
[2] Feeling good: The future of the $1.5 trillion wellness market – McKinsey, 8^th April 2021
[3] Health and Wellness Market Worth USD 6.94 Trillion with CAGR of a 5% from to 2031 | TMR Study – Transparency Market Research, 18^th October, 2022
[4] CVS to buy home health giant Signify Health for about $8 billion – CNBC, 6^th September 2022
[5] Walgreens steps up focus on home health with $330M CareCentrix deal – Fierce Healthcare, 1^st September 2022
[6] Fresh food as medicine for the heartburn of high prices – Deloitte, 26^th September 2022
[7] Consumer Pulse – dunnhumby, October 2022
[8] Men's Personal Care Market Size, Share & Trends Analysis Report By Product (Skin Care, Hair Care, Personal Grooming), By Distribution Channel (Hypermarkets & Supermarkets, E-commerce), By Region, And Segment Forecasts, 2022 - 2030