Wellness Industry Resilience: How Gen Z and Millennials are Shaping a New Market Trend

The wellness industry is witnessing a remarkable transformation, driven largely by the spending habits of Gen Z and millennials. These younger generations are significantly increasing their investment in health and wellness, which analysts are identifying as a key factor that may help this sector endure potential economic downturns.

According to recent findings from Bank of America, there is a pronounced shift among younger Americans toward adopting healthier lifestyle habits. As they prioritize fitness and wellness, their spending patterns are providing much-needed support to the industry.

Bank of America analysts stated, ‘We believe there is an ongoing generational shift toward healthy habits, which is supportive of wellness stocks. Younger demographics, including Gen Z and millennials, are increasingly prioritizing healthy ways of living and spending increased time and income on fitness, activity-based leisure, and wellness-focused discretionary items.’

Despite a general pullback in discretionary spending observed across various households, Gen Z and millennials continue to invest in wellness. Retail data showed a 7% year-over-year increase in spending at fitness centers, the highest growth rate seen in 19 months.

On average, Gen Z households are spending approximately 2.8 times more on fitness than baby boomers, while millennials’ spending is about three times higher. The engaged interest of these young individuals in health is further evidenced by their reduced alcohol consumption. Non-alcoholic beverages are seeing a surge in popularity, with spending growth outpacing that of traditional alcoholic drinks.

Current wellness trends also reflect a spike in interest, with Google searches on terms like ‘cold plunge’ and ‘red light therapy’ skyrocketing in recent months.

Prominent Wellness Stocks

Bank of America has listed several wellness stocks that stand to benefit from the ongoing investment trends of Gen Z and millennials:

Life Time Group Holdings (LTH)

Current price: $30.04
Year-to-date performance: +34.17%

The company demonstrates robust growth, particularly among its younger users, with a notable 60% increase in monthly active users aged 18 to 44 in 2024.

Planet Fitness (PLNT)

Current price: $95.89
Year-to-date performance: -3.72%

Planet Fitness is witnessing strong momentum, with card spending growth surpassing overall spending trends in fitness centers.

Sharkninja Inc (SN)

Current price: $84.27
Year-to-date performance: -13.05%

The company’s product line, popular among fitness influencers, is expected to exceed revenue estimates, with substantial social media engagement.

The patterns emerging from the spending behavior of Gen Z and millennials serve as a guiding light for investors seeking opportunities in wellness stocks, as these younger consumers are eager to allocate their resources towards a healthier future.