China will be among the main growth focus areas for yoga and fitness apparel maker Lululemon Athletica, with the market outpacing others in terms of sales.
The coronavirus pandemic has led to a boom in yoga and other wellness activities in various parts of the world, but more so in China, which got a total well-being score of 79 out of 100, higher than the 65 global average, according to a survey conducted by the Nasdaq-listed company.
The online survey, held from November 13 to December 1 last year in 10 countries, asked 10,000 respondents aged 18 years and above about their well-being in terms of physical health, emotional balance and social bonds. France and Singapore came in second and third on the index, with a score of 67 and 66, respectively. Japan had the lowest well-being score of 60.
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The well-being perception of a population appeared to have affected consumers’ confidence in spending, particularly as seen in Lululemon’s sales in China.
“The impact of being proactive is seen in China, the market with highest regional well-being index of 79, and 62 per cent of its citizens feeling well across all three dimensions,” said Calvin McDonald, Lululemon’s chief executive. “The research indicates strong well-being in China is supported by a proactive mindset among 78 per cent of the population.”
In the third quarter, revenue from China more than doubled, outpacing the 45 per cent growth in overall international markets for the Vancouver-based company.
“We saw a 45 per cent revenue increase in international markets, and despite all that happened in the world, China delivered a really strong performance with total revenue increasing by more than 100 per cent in the third quarter,” McDonald said.
By the end of this year, the company hopes to add between 30 and 35 stores to the 515 it currently operates across the world. “We continue to open stores in China at a steady pace. We are just in the early phases of our growth, both in China and around the world,” the CEO said.
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It was not surprising that consumers spent more on health and well-being during the pandemic, which has infected about 109 million people worldwide and claimed the lives of 2.4 million, according to the latest data from the World Health Organization.
“With the growing awareness and understanding of health and wellness under the disruption of the pandemic, consumers tend to be more willing to pay for well-being during the pandemic and after. Consumers acknowledge the importance of immunity and preventive health and, therefore, have been actively involved in activities and consumption related to well-being more in 2020,” said Jane Zhang, an analyst at Euromonitor International.
The market research firm found that 22.4 per cent of consumers globally were doing physical exercises daily last year, up from 16.9 per cent in 2019. Those taking vitamins or supplements also increased to 38 per cent from 36 per cent.
Worldwide, the global health and wellness industry grew by about 6 per cent to US$775.5 billion in 2020, while in China the industry grew 3.3 per cent to US$121.7 billion, Euromonitor said. By 2025, the industry is likely to grow to US$874.6 billion, a 13 per cent rise over 2020 figures. But China will outpace this growth, and is forecast to hit US$145.1 billion in this period – an increase of 19.2 per cent.
“The aspiration for well-being and a healthy life is not new,” said Pascal Martin, partner at OC&C Strategy Consultants. “It was a global structural trend before Covid-19. But Covid-19 has forced people to reflect about the importance of staying healthy to avoid risks of complications in case they become infected, for example due to being overweight, or due to other conditions like cardiovascular diseases or diabetes.
“This has reinforced people’s interest in embracing a healthy lifestyle, which means more exercise, better quality and healthier food, and the consumption of supplements to reinforce natural immunity against diseases and viruses. The Covid-19 crisis has accelerated the profound and global trend for the pursuit of well-being.”
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