The pandemic era has emerged as a blessing in disguise, rendering people all over the world the time and temper to reflect on their lifestyles, with a special focus on enhancing the household experience and overall well-being. The momentum has already been in the making for more than a decade now. There is an evident shift in the perspective: from perfect sleep being seen as a casual chore to getting acknowledged as a necessity with pivotal consequences. This has further aided in the evolution of the sleep solutions industry or what we call the sleep economy.
The sleep economy is more than just about sleep. The sector not only caters to the fundamental human emotions of comfort and relaxation, but it also helps the consumers subdue feelings of anxiety and stress, two primal forces that today’s ceaselessly growing urban population confronts on a daily basis. The effect is evident as the stats speak for themselves:
- According to the report published by Allied Market Research, the global sleep aids market generated USD 59.8 billion in 2020 and is projected to reach USD 111.9 billion by 2030, witnessing a CAGR of 6.9% from 2021 to 2030.
- Revenue in the Mattresses segment amounts to USD 250.80 million in 2022 as per reports by Statista. The market is expected to grow annually by 8.05% (CAGR 2022-2026)
- Globally, smart bedding products have gathered a revenue of USD 32 billion in 2020 (Sleep Market: Global Outlook and Forecast 2021-2026 Report) and is expected to reach USD 45.59 billion by 2026.
- According to the Global Market Insights Report 2021, the sleep tech device market size exceeded USD 12.5 billion in 2020 and is poised to achieve over 17.8% CAGR between 2021 and 2027.
- As per the report by Statista, the Indian mattress market amounted to an astonishing USD 250.80 million as of 2022, having grown at a CAGR of 11 percent over the last half-decade.
- The unorganised sector dominated the Indian market, but an increased level of awareness and purchasing power of consumers stimulated the growth of the organised sector at a CAGR of 17 percent.
- The same report indicates that the Indian mattress market is expected to grow annually by 8.05% (CAGR 2022-2026).
KEY TAKEAWAY :
- North America has held the largest share of the sleeping aids market for almost half a decade.
- APAC is projected to be the fastest-growing region in the coming years.
- Revenue in India’s mattresses segment amounts to USD 250.80m in 2022. The market is expected to grow annually by 8.05% (CAGR 2022-2026).
- India’s sleep product market is witnessing a constant flux from international brands, native players and start-ups.
- The wearables sleep accessories segment is projected to witness a 17% growth rate through 2027.
- Data and AI will lead the way for new-age sleep accessories.
The Bigger Picture
According to the Sleep Aids Market Research Report 2020 by Prescient Strategic Intelligence, North America has held the largest share of the sleeping aids market for almost half a decade now. The growing prevalence of sleep disorders, increase in healthcare expenditure and improved infrastructure are some of the main reasons for this dominance. Considerable attention also needs to be given to the initiatives and support from both, the public as well as private institutes in increasing awareness about sleep health in this region.
The same report also indicates that APAC is projected to be the fastest-growing region in the coming years. Elevated awareness, low cost of manufacturing, increased geriatric population and rising prevalence of sleeping disorders as well as better diagnosis are some of the main reasons for this expected growth. The population is also showing contained interest in using technological solutions to enhance the quality of their sleep.
Priyanka Salot, Co-founder of The Sleep Company points out, “Traditionally, the Indian mattress industry has been dominated by the informal sector leading to low quality that depended on the low-price factor. However, the scenario has been slowly, but steadily, changing as new start-ups come up with smart sleep technology products, investing in research to offer premium products to the buyer at a competitive price. Consequently, India is one of the driving markets behind the overall growth of the mattress industry in the Asia-Pacific region”
Indian Sleep Industry Overview
It is true that heightened awareness amongst people about the importance of optimised sleep, followed by willingness and capability to spend has been a major push to the sleep industry. However, larger trends have been exerting influence too. Post pandemic period has seen elevated investment in real estate. The hospitality sector has also seen a boom thanks to a general upward trend in the tourism industry. Besides, there has been an obvious surge in Hospitals and Health Retreats. Both, the residential and institutional sectors have had a positive cumulative effect on the bedding industry.
A closer look at the Indian market through the report “Indian Mattress Market Outlook 2020-2025” by Business Wire throws light on some very exciting numbers. Revenue in the Mattresses segment amounts to USD 250.80m in 2022. India’s mattress market has grown at a CAGR of 11 percent over the last half-decade. The unorganised sector dominated the market, but an increased level of awareness and purchasing power amongst consumers stimulated the growth of the organised sector at a CAGR of 17 percent.
The mattress market is divided into three tiers: the tier one segment is considered as a premium mattress buyer. The Tier-two segment is the top contributor to the overall mattress market share as the largest buyer of mid and economy-pricing segments. Tier 3 consists of Luxury mattresses which have the lowest penetration but is seen as the fastest-growing market in the mattress industry. The big players that are dominating the market are Kurlon, Sleepwell, Centuary, Peps, Springwell, Coir Foam, Duroflex, Godrej and Springfit Mattress.
Subsequently, India’s sleep product market is witnessing a constant flux from international brands, native players and start-ups. With a heightened awareness and the urge to enrich daily lifestyle, there seems to be a void in the market. This poses an opportunity as well as a challenge for all stakeholders present in the sleep tech ecosystem of the country.
The void or gap has catalysed a new generation of start-ups entering the sleep market and leveraging the latest technology and innovation backed by large-scale data to design, develop and market their sleep accessories. Wakefit, Sleepy Cat, Sunday, The White Willow, Cuddle, Mattress Box and Wink & Nod are some of the new players trying to make the best of this new wave.
D2C models are seeing elevated adoption to make the best of the current market. Accessibility, affordability and multiple choice are the driving factors for online consumers. At the same time, brick-and-mortar stores are also undergoing transformation. The focus is not just on the mattress, but the holistic experience of sleep as a whole. By curating a more personalised and interactive shopping experience, they are hoping to leverage the same. In all fairness the perspective of the “Indian sleeper” is changing and so is the dynamic of the Indian Sleep Economy, promising exciting developments in the near future.
What lies ahead?
According to Aritzon, the global sleep market size is expected to reach revenues of USD 137.16 Billion by 2026 while the Indian mattress market is expected to grow annually by 8.05% (CAGR 2022-2026).
Shift to the organised sector:
As the value of quality sleep is being realised, people are willing to know and spend more, to sleep and live better. They want to get their mattresses from a reliable source that offers after-sale services, guarantees, and consistent quality. Hence there is an evident lean towards brands. Plenty of new start-ups have been able to carve out for themselves market share too.
Upgrade is the new cool:
Those who bought coir earlier are shifting to foam and spring mattresses. Those who had bought foam are moving towards smart mattresses. Globally, smart bedding products have gathered a revenue of USD 32 billion in 2020 (Sleep Market: Global Outlook and Forecast 2021-2026 Report).
The smart bedding segment provides multi-sensor equipment like smart mattresses, pillows, ambient light, sound systems etc. The features are expected to improve further with dedicated investment being poured into R&D, while prices are expected to be maintained at a reasonable level so as to increase accessibility and affordability. The smart bedding segment is expected to reach USD 45.59 billion by 2026.
The digital sleep:
The bubbling digital revolution, having received a push in the covid era, along with the rise of new business models like D2C have led the way for change. Be it temperature-adjusting blankets or mattresses with adaptable firmness, customers are showing keen interest and thereupon rousing investment in R&D that promises significant sleep technology advancement.
Wearable sleep accessories are seeing rapid growth as well. Their easy portable nature, user-friendliness, and accuracy enable continuous monitoring. Complimenting them are applications providing support for optimised sleep. They can be synced with wearable accessories for the best results. Besides, they have also established themselves as style statements in the larger ‘fitness-freak’ moment. Again, leaning on the reliable data from the Global Market Insights report 2021, the wearables segment is projected to witness a 17% growth rate through 2027.
The trend of selling mattresses through online distribution channels, especially on company-owned websites as well as global and local e-commerce portals is expected to create significant opportunities for manufacturers and retailers alike. Companies are also crafting lucrative offers through attractive discounts, convenient payment schemes, easy return policies, etc. to drive sales on e-commerce websites amidst tough competition. Some of the prominent companies in the global market facilitating this era of “digital sleep” are Beddit (Apple Inc.), Casper Sleep Inc., Dodow (LIVLAB), Dreem, Eight Sleep, Emfit Ltd., Fitbit Inc. (Google LLC), Koninklijke Philips N.V., Oura Health Ltd., ResMed Inc., Sleep Shepherd LLC, Sleepace, Withings, and Xiaomi.
Innovations & the future of the sleep economy
The realisation regarding the importance of healthy sleeping habits and how they promote well-being in other domains of life becomes more apparent every day. Obviously, the number of people seeking optimised sleep health also increases. All of this will lead to demand for more personalised solutions stimulating technological innovations that score well on affordability and accessibility too. In fact, many experts are saying that the sleep market will soon hold equal prominence alongside the heavyweights of the global wellness industry.
The last decade has seen significant expansion in the development and use of multi-modal sensors and technologies for the purpose of monitoring physical activity, sleep cycles and circadian rhythms. This has made accurate sleep monitoring possible at quite a large scale. The data generated holds potential for numerous applications, from epidemiological research and wellness apps to early diagnosis and development of intervention-based accessories.
Coupled with machine learning and deep learning systems, AI can easily automate processes, elevate efficiency and minimise errors. For example, an AI-powered mattress called Emma Motion has been launched that is equipped with 360-degree motion sensors so that it adjusts itself in order to optimise the sleeper’s comfort in every position.
Amidst all the excitement, it is equally crucial to objectively look at the prevailing challenges and turn them into possibilities. By tackling ignorance and spreading awareness about the importance of sleep, the industry also encourages customers to buy better which directly translates into profits. The stiff competition in the industry is healthy as it acts as a catalyst for pushing brands to make better and more affordable products.
To sum it up, it would be safe to say that the dream of the perfect sleep that humanity has been fixating on for decades seems to be finally materialising in the sleep economy of today, and the near future.