Digital Wellness

A new industry proving that digital connectivity and mental health can co-exist.

Overview

In our fast-paced world, many grapple with various mental health challenges, so a proactive approach to maintaining mental well-being is essential. While some mental health issues require professional assistance, integrating wellness practices into daily life can be a powerful preventive measure. For example, meditation, mindfulness, healthy sleep habits, and regular physical activity can significantly reduce the risk of severe mental health challenges.

The rise of technology has transformed how we access wellness resources, making them more readily available than ever before. With the proliferation of smartphones, tablets, smart TVs, and other connected devices, users can easily engage with various digital wellness tools. These services are offered through diverse business models, all aimed at empowering individuals to sustain and proactively enhance their mental health.

Digital wellness apps typically fall into four categories: meditation and psychological wellness, mindfulness and cognitive wellness, sleep therapy, and fitness. By leveraging these resources, individuals can take meaningful steps toward improving their mental well-being and fostering resilience in the face of life's challenges.

Industry Updates

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Market Sizing

The meditation, mindfulness, and sleep apps market in the US could reach USD 2.8 billion–3.5 billion by 2028

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Market Mapping


Meditation and psychological wellness startups dominate the digital wellness disruptors

Although meditation and psychological wellness companies represent the bulk of digital wellness startups, mindfulness and sleep therapy apps have garnered more attention over recent years. Some larger players in the meditation and psychological wellness space, such as Headspace, Calm and Insight Timer, also offer sleep and mindfulness services in an attempt to serve as one-stop solutions for digital wellness. Other startups in the digital wellness industry specialize in a single wellness segment.

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The Disruptors


Calm leads in terms of funding and revenue and Headspace follows closely

The digital wellness space is still in its go-to market stage with the players being privately funded and raising funds occasionally. Calm leads among digital wellness disruptors closely followed by Headspace. Another notable disruptor is Insight timer, who in fact claims to rank first in the US among meditation apps in terms of the time spent by users.

Funding History

Competitive Analysis


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Incumbents


Traditional wellness and yoga studios digitize their offerings

The Covid-19 pandemic has accelerated a long-term trend of traditional brick and mortar yoga studios and healthcare providers offering their services online.

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Notable Investors


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Overview

Helping users relax, enhance mindfulness, and improve fitness through the digital delivery of services

Digital wellness refers to a variety of digital tools and services designed to help users relax, reduce stress, enhance mindfulness, improve fitness, and address mental health issues such as depression and anxiety. Traditionally, wellness services have been delivered through physical studios with limited flexibility for people with busy schedules. Individuals from all walks of life now demand access on their terms and schedules, opening up opportunities for digital tools to replace traditional wellness delivery methods and adding more value to the digital wellness ecosystem. This new generation of digital wellness services predominantly exist as smartphone apps and generally fall into one of four broad categories: meditation and psychological wellness, mindfulness and cognitive wellness, sleep therapy, and fitness apps; notably, the three largest players in digital wellness—Headspace, Calm, and Insight—cover multiple areas.

Digital wellness business segments

Physical wellness studios have existed for decades, but digital wellness products—in the form of meditation apps Insight Timer and Headspace—didn’t come into their own until the proliferation of smartphones after 2010. Digital wellness started getting mainstream attention around 2015 following the success of these first movers, with an estimated 2,500 meditation apps launched worldwide by the end of 2020. Furthermore, global consumer spending on the two leading digital wellness apps—Calm and Headspace—increased at a five-year compound annual growth rate (CAGR) of 28.7% from USD 140 million in 2018 to USD 495 million in 2023.

The proliferation of wearable devices supports digital wellness adoption

Because a large majority of digital wellness products are smartphone apps, smartphone penetration is the key enabling factor for the industry. Secondarily, the falling prices of wearable devices have benefited the industry, as they are often integrated into digital wellness products to provide metrics such as heartbeat, breathing, movement, and blood pressure. Some digital wellness players also offer their own first-party devices, although third-party wearable integration is much more common. Wearable device penetration among the US adult population is expected to reach almost 26% in 2024 (up from 22% in 2020), a positive signal for the further adoption of digital wellness services.

Companies bundling digital wellness services with wearable devices

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