The Market for Self Improvement Products & Services

(October 2001 – 4th Edition)

Published by: Marketdata Enterprises, Inc.

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©Copyright October, 2001 Marketdata Enterprises, Inc. Reproduction or distribution in whole or in part, by any means written or electronic, without prior written permission of the copyright owner is strictly prohibited. Violators will be fully prosecuted under US copyright laws

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Executive Overview of the Market: Major Findings

Nature of the Market - Why The Demand?...

 

America has an almost limitless craving for “psychological sustenance”.  During this spiritually famished time, popular “gurus” such as Marianne Williamson, Barbara DeAngelis, Anthony Robbins, Stephen Covey, Carlton Sheets, Deepak Chopra, and many more that promise to improve our relationships, marriages, finances, physical well-being, memory, business and communications skills, and help us get in touch with and explore ourselves or heal our addictions, are drawing huge audiences and generating substantial book, seminar, consulting and audiocassette sales—with incomes for their various activities generating as much as $80 million per year in some cases. Spiritual and motivational “gurus” are a booming business.

 

It seems as if we need the teachers to tell us what we should already know—that we really don’t need them.  We want hand-holding.  As a New Age Journal article said:  “...We could spend our whole lives going from one spiritual workshop, diet or fitness program to another without ever realizing that the whole enterprise is based not so much on self-improvement as on self-loathing… That, as much as anything, seems to be at the bottom of the guru culture we’ve created in America—our tendency to look for happiness outside ourselves in some guru’s enlightened plan.”

 

There is no shortage of products to feed this appetite, in a myriad number of “packages” or varieties, encompassing: books, audiotapes, CDs, seminars and workshops, lectures and more.  Some of the players in the self-improvement market have been operating since the 1930s, others have just recently become popular by virtue of a bestseller or following among business or the public.  Most all of the competitors operate privately-owned companies, and revenues are closely guarded secrets.  Some marketing gurus have begun calling it “the experience industry,” and it is  growing multibillion-dollar business.

 

So much of the self-help industry is about fixing something—whether it’s your sex life, your soul, or your cardiovascular system.  It’s spun under the mantra of “holistic health,” and it can be an obsession for consumers in the experience industry

 

Market Definition...

 

For this study, Marketdata focused on products and services that seek to improve a person--mentally, spiritually, physically, or financially.  The topics or areas Marketdata investigated are.... inspirational/motivational, losing weight, leadership/sales skills, improving relationships, gaining financial independence/money making opportunities, exercise programs or equipment, stress management/relaxation, memory improvement, and speed reading.

 

Some of the key people comprising the field operate alone, but more often they know each other and are frequently “packaged” together by promoters who arrange to have as many as eight speakers at a 1-day public seminar, or their book and cassette programs are sold side by side in mail order catalogs.  They frequently “plug” each other’s products. 

 

The self-improvement products market is largely comprised of female customers, especially for programs related to relationships, weight loss, exercise, and spirituality and Far Eastern topics.  For men, the market is concentrated primarily on business and organizational skills improvement. Programs related to stress management and relaxation techniques are more broad-based, applicable to both sexes.  A substantial share of customers are located on the two coasts of the United States, and California is especially receptive to “new age” topics, Far Eastern disciplines, holistic and alternative health care.

 

Many in the field see a move away from the 1980s hype of the self-improvement “gurus” and “magic pills”, and toward more practical work and personal life skills programs—i.e. “personal resourcefulness”, an increasing movement of educated self-improvement buyers demanding products that will help them take control of their life. 

 

Major New Developments of Past Two Years…

 

1.      Market Value... The total self-improvement market (incl. revenues of commercial & medical weight loss programs) is estimated by Marketdata to be worth $5.7 billion as of 2000.  We expect 9.1% yearly growth through 2005, to a value of $7.78 billion four years from now.  The market has been growing 9.9% annually since 1998, up nearly 20% in two years.

 

2.      The major category of the market is comprised of general motivational, spiritual and  self-help products and programs—32% of total sales. This category has grown in importance since 1998.  Conversely, the business/financial category has declined in relative importance, now accounting for 21% of sales last year.  Weight loss and exercise are still major categories of self-improvement, representing 16% and 25% of the market, respectively.

 

3.  Infomercial sales... While overall infomercial sales posted a record year in 2000, an estimated $2.39 billion, this is NOT true of self-improvement.  Sales of SI programs and products are flat, $997 million in 2000, versus $969 million in 1998.

 

4.  Audiocassettes Market...  Audiobook sales are booming, but not so for self-improvement tapes. This market is also flat, with an estimated $391 million in 2000 sales, versus $400 million in 1998.  The total market grew, but the share of market for SI tapes fell. The boom was more focused in bestselling fiction titles.  However, the future appears bright as the universe of users is growing, the Audio Publishers Assn. Has become much more proactive and marketing oriented, and more distribution channels are opening up. This market segment is poised to take off for self-improvement.

 

5.      Books...   An estimated 1,800 self-help/inspirational books were released in 1997, with sales valued at $538 million.  This sales figure grew to $611 million last year, according to Simba Information Inc., up 13.5% in two years. We counted at least two SI books on the 2000 bestseller list. The number of “new age” bookstores appears to have leveled off at 4,000.

 

6.  Motivational Speakers...  This segment’s sales are estimated at $382 million for last year, for the top 15 speakers and their companies, including the seminar/consulting/training operations of the Franklin Covey Company, and Hispanic motivational speakers.  The merger of independent author/speaker/consultant Stephen Covey with Franklin Quest Co. in 1997 expanded his scope and number of seminar leaders and trainers. The newly defined Hispanic motivational speakers market is small but should emerge within the next five years.

 

7. Public Seminars...   This segment of the market is definitely hurting. Franklin Covey has scaled back the number of public seminars it offers, citing declining profitability and rising expenses, and CareerTrack and Fred Pryor Seminars are no longer running public seminars, at least through the end of the year. These two seminar companies have been taken over by FPS Acquisition Corp. in a reorganization.

 

8.  Stress Management...  This market has been flat, $307 million in 2000 versus $301 million in 1998.  However, sales of stress management books and programs of all kinds should grow this year and beyond, due to increased job pressures caused by the current recession, stock market jitters, and new long-term concerns about terrorism and national security.

 

 

 

 

 

 

 

Market Segments...

 

The market is divided by TOPIC OR AREA of self-improvement, as follows below.....

(excluding revenues of commercial and medical weight loss programs, but including sales of diet programs sold via infomercials, books, cassettes, holistic institute seminars, and motivational speakers.)

 

Value of Self-Improvement Market Segments, By Topic: 2000

 

Topic

Estim. Revenues

% of Total Market

 

($ millions)

 

 

 

 

General motivational, new

age, spiritual, self-help

$1,833

32.1

 

 

 

Business/financial

1,199

21.0

 

 

 

Stress management

291

5.1

 

 

 

Weight loss

914

16.0

 

 

 

Exercise

1,473

25.8

 

 

 

     TOTAL:

$5,711

100.0

 

Source: Marketdata Enterprises, Inc. estimates

 

 

Market Segment Outlooks...

 

Infomercials

 

Forbes magazine reported that TOTAL sales of ALL goods sold via infomercials back in 1988 were $350 million.  Sales grew strongly to nearly $1 billion by 1991, but had flattened out since then according to the Wall Street Journal and NIMA (the field’s leading trade group).  Infomercial sales were stuck at the $1 billion level for 1994, 1995 and $1.14 billion in 1996. Production and media costs have soared.   However, 2000 media billings data from Response magazine points to major growth since 1996—in fact a doubling of infomercial sales, to $2.11 billion in 1998 and $2.39 billion last year.

 

Self-improvement programs/products last year accounted for $398 in media billings, which translates into an estimated $997 million in actual sales. This represents about 42% of total infomercial sales in the U.S. (but it does include exercise machines and “health & fitness” products).  For the most part, self-improvement products’ sales have NOT benefited from this infomercial boom since 1998.  For example, sales of diet/weight loss programs from 1998 to 2000 have been flat, financial/business program sales are down 30%, and personal development/self-help items are down 50%.

The only category (and the largest one) within the self-improvement class that is up since 1998 is “health & fitness”, which includes a variety of exercise machines. 

 

2001 Status Report

After leveling off at the $1 billion mark in 1995 and 1996, infomercial sales appear to have soared through 1998.  According to the Electronic Retailing Assn. (formerly NIMA) quarterly media billings for 1998 totaled $844 million. The ERA no longer provides this data, but refers people to Response Magazine, which does track billings, for all infomercials in total and by category or topic. Following were the billings reported by Response for 2000 (all infomercials):

 

1st quarter:  $262.4  million

2nd qtr.          235.0

3rd qtr.           228.9

4th qtr.           231.0

 

  Total year: $957.3

 

The ERA informed Marketdata that to arrive at an estimate for actual infomercial SALES, multiply media billings by 2.5.  Doing the math, that means that estimated 2000 infomercial sales were $2.39 billion. This is compared to estimated 1998 sales of $2.11 billion—up about 13.3% in two years. It should be pointed out that 2000 appears to have been a record year for billings and sales. With the current economic slowdown and depressed consumer spending, the picture will be far gloomier in 2001.

 

By self-improvement category, here are the annual media billings reported:

($ millions)

 

 

1998

1999

2000

1st Qtr. 2001

 

 

 

 

 

Diet, weight loss

$81.3

$107.5

$96.2

$15.5

Financial/business

   opportunity

100.7

65.3

69.1

11.0

Personal developmt.,

  self-help, education

56.7

40.1

26.3

55.6

Health & fitness, exercise

   machines

148.7

172.5

207.2

6.8

 

 

 

 

 

 

 

 

 

 

 

Multiplying the above media billings figures by 2.5, Marketdata estimates the following values of infomercial sales for these SI categories for 1998-2000. Sales totaled an estimated $997 million in the year 2000.  This means that sales of SI programs/products sold via infomercials grew by just  2.9% over the two-year period 1998-2000.  This also means that SI programs accounted for about 42% of total infomercial sales during 2000, down from 46% in 1998.

 

Infomercial Revenues
 199819992000
Exercise equipment$372 million$431 million$518 million
Diet Programs203268240
Self-improvement, self-help, motivational14210066
Business/money-making opportunities252163173
Total$969 million$962 million$997 million

 

 

Motivational Speaker Profiles...

 

Stephen R. Covey

 

Named one of America's 25 most influential people, Stephen R. Covey, a 69-year-old Harvard MBA, has often been called today’s “high priest of self-help."  Covey has built a diversified and thriving empire of related products and services.  He was a professor of business management and organizational behavior at Brigham Young University for 20 years.  Mr. Covey is a modern-day version of Norman Vincent Peale, and is hot. His first book: 

 

The 7 Habits of Highly Effective People was on the New York Times  best-seller list for 144 weeks beginning in 1993.   So far, more than 12 million copies have been sold, and it is reportedly the best-selling business book of all-time..  The book has been translated into 26 languages as well. Another of Covey’s books is:  First Things First ($23 hardcover), which offers a "principle-centered approach to transform the quality of everything you do, empowering people to define what is truly important."  Other Covey books include Principle Centered Leadership:  How to Succeed with People and The 7 Habits of Highly Effective Families.  His latest book, Living the 7 Habits sold 156,000 copies in trade paperback in the year 2000.


Franklin Covey Company

 

The big development in Covey's professional life in recent years was that in 1997,  the Franklin Quest Company, a leading provider of training seminars and the creator of the Franklin Day Planner, and the Covey Leadership Center announced the closing of their merger.

 

 

The merged company, known as the Franklin Covey Company, had fiscal 2000 revenues of $585 million.  Franklin Covey operates over 120 retail stores, and has a client base that includes 82 of the Fortune 100, more than two-thirds of the Fortune 500 companies, thousands of midsize and small companies, government entities, educational institutions, communities, families and millions of individual consumers.  Franklin Covey’s retail stores are located in top retail centers throughout the nation.  The company's headquarters are in Salt Lake City, Utah.

Franklin Covey's Seminars and Training

 

Covey's motivational gospel is spread through various publications and seminars that attract corporate types from Xerox, AT & T, and other big names.  Unlike most motivational speakers who are one-man shows, Covey had trained about 5,000 facilitators in companies across the U.S., each of whom pays around $2,000 to obtain certification from Franklin Covey.

 

Many of Covey’s ideas are rooted in religious teachings, since he is a devout Mormon.  His day-long seminar attacks some of the narrow-minded practices of Corporate America.  Covey’s principles urge followers to be pro-active, establish clear-cut goals, think positively, and act ethically.  The "Seven Habits"  and "First Things First"  Time Management seminars are offered in more than 75 cities in North America and in 40+ nations worldwide.

 

This division of the firm generated $214 million in sales last year, 37% of the total company revenues. The firm uses 115 training consultants, who give workshops and seminars in addition to Covey himself.  560,000 people have been trained by the company to date. The “What Matters Most” 1-day seminar is very popular, and accounts for 29% of this division’s $214 million (or $62 million). At a cost of $229, this time management course teaches three basic steps to better productivity:  (1) discover, (2) plan, and (3) act.

 

Tony Robbins

 

Anthony Robbins is a writer and motivational speaker who has been called "America's results coach" and the "Mahatma of motivation."  In fact, Robbins was probably the most successful of the motivational speakers of the late 1980s-early 1990s. He continues to be a major force, one of the biggest names on the self-improvement circuit.  However, his infomercials (Personal Power and Personal Power II) have not been among the top ten in the past five years, and he is not quite as visible, at least on TV, as he used to be.  Rather, the majority of Robbins’ revenues today are derived from his one-day public seminars  and smaller multi-day programs.  He has a lot of them—about 30 are scheduled for 2001.

 

In the past two decades, Robbins has written five motivational self-help books, which have been translated into 14 languages.  These are Unlimited Power: The New Science of Personal Achievement (1986), Awaken the Giant Within:  How to Take Immediate Control of Your Mental, Emotional, Physical, and Financial Destiny (1992), Giant Steps (1994), Notes from a Friend (1995), and Driving Force (2001).

 

His speaking engagements, unlike those of more sedate self-help gurus such as Deepak Chopra, often take on the characteristics of a rock concert.  Dressed in a well-tailored black suit, wearing a headset microphone, Robbins restlessly paces the stage, giving high-fives, jumping up and down, and punching the air.  He's apt to shout such phrases as "I'll do it," or "quadruple the intensity," or "push beyond excellent to outstanding."  What's more, his image is usually projected on giant video screens around the arena for the benefit of those seated away from the main stage.  He also uses sophisticated concert lighting, pyrotechnic effects, and plays inspirational rock anthems by the likes of Phil Collins.

 

He also has an infomercial, “Personal Power--30 Days To Success”, produced by Guthy-Renker Corp., which has grossed roughly $220+ million since 1989 ( an average of  $18 million/year over the 12-year period).  This has now been updated to “Personal Power II.” Company literature claims that Personal Power is the #1 personal and professional improvement system of all time, with 30+ million tapes sold.  Robbins is reportedly shooting a new infomercial, and “Personal Power II” is still airing.  Infomercial industry analysts Marketdata interviewed estimate that Robbins’ show and sales from the QVC Network combined totaled over $20 million in 1998.

 

A 1995 Forbes magazine article estimated Robbins’ two-year 1993-94 take from Awaken the Giant Within at $12 million.  This may be very conservative.  A New York Times article from 1997 estimated Robbins' annual income, from all sources, at  over $50 million.  Meanwhile, a 1999 article from Business Week put Tony Robbins' income at more than $80 million.

 

 

The Audiotapes/Cassettes  Market.... 

Status of The Market

According to the Audio Publishers Association (APA), the overall market for spoken audio has doubled over the past eight years, and is now worth an estimated $2 billion. Self-help and inspirational categories are ranked third and fourth, respectively, as the most popular categories.  However, the market for self-improvement audio tapes is not growing as fast as the total market.  Most of the recent strong growth applies to best selling fiction titles. 

 

The APA found that audiobook sales grew 10.2% in 1998. (This includes sales through nontraditional channels as well as retail.).  Cumulative growth from 1995-1998 was 39.6%.  From 1990-1998, the audiobook industry really came into its own, as sales soared 360%.

 

In Publishers Weekly’s 1999 annual report of the top audios one finds some familiar self-improvement names.  One is The 7 Habits of Highly Effective Teenagers, by Stephen Covey’s son Sean Covey.  Another example is Chicken Soup for the Soul, by Jack Canfield and Mark Victor Hansen (Health Communications).

 

In 2001, the audio industry is having one of its best years.  Most audio publishers contacted by Publishers Weekly report double-digit sales increases for the first quarter of 2001 over the same period last year.  At Time Warner AudioBooks, sales are up about 33%.  Brilliance Audio’s sales are up 25%, and Simon & Schuster Audio is experiencing double-digit increases.  Sales are also “dramatically” up at HarperAudio and Random House AudioBooks, says executives at those companies.

 

Sales tell only part of the story, however.  There are simply more audiobooks users than ever before.  The APA’s latest survey finds that 22.5% of American households have listened to audiobooks in the last year, up from 21% in 1999.  Industry executives claim that something is different this time, with the market reaching a critical momentum.  The APA itself has contributed to this growth.  This year, the APA launched the Audio Buyers Conference, in which audio buyers from diverse markets (truck stops, mass merchants, catalogues and others) spoke about the specific needs of their customers and met with publishers in one-on-one sessions.  The result has been increased communication and understanding between all parts of the industry.

Audiobook Market Demographics

 

The 1999 APA study describes the demographics of audiobooks users; this study asked more detailed questions than the 1995 survey.  The median income of listeners is $54,900.  The average male listener is 41.9 years old, while the average female listener is 44.2 years old. 

 

The average audiobooks household listens to 13.9 audiobooks per year, and within that household, the main user listens to 13.1 of those 13.9.  The average listener has now been listening for 3.7 years and 65% of audiobooks households are “married” households.

 

Interestingly enough, the highest amount of listening time comes from males aged 21-34 and females 50-64.  The breadth between these two groups demonstrates that the appeal of audiobooks has stretched beyond the 35-50 range seen in the last study.  The fact that most concentrated use falls into the 35-64 age range bodes well for the success of audiobooks among the older population.

SI Audiotapes Market Potential

 

A March 1994  Wall Street Journal article said that some retailers and publishers believed audiobooks, for decades considered a minor category, of interest only to the blind and available mostly through libraries and mail order, were poised for a mass-market breakthrough. They were right.  Retail sales were estimated to hit $2 billion in 1999, according to the APA, versus $1.2 billion in 1993.  This is compared to only $250 million back in 1988.  Based on recent efforts by the APA and improved market conditions, Marketdata believes that the total audio market has grown at a faster rate in 1999 and 2000.  We estimate that sales grew 15% last year, to $2.3 billion.  Based on very strong first quarter 2001 sales by leading publishers, we think the market could grow 25% to $2.8 billion this year.

 

Based on interviews Marketdata conducted with sales and marketing personnel from the major audio publishers as well as survey findings from the APA, we believe that 17% of the total audiocassettes (spoken audio) market today is related to self-help/self-improvement topics, the same as 1997.  This would value the SI audiobook market at $391 million last year and $476 million in 2001.

 

What’s happening is that the total audiobooks market (including fiction)  is growing faster than the audiobooks market for self-improvement titles.  This is corroborated by comments from Nightingale-Conant, whose management claims that their sales are growing only 5% per year.  They claim that mail order sales are sluggish.  The APA’s 1999 survey did report that the “general/miscellaneous non-fiction” category (which would include SI titles) declined from 29% to 21%, and language instruction programs held steady at 2%. 

 

 

The Full Study Contains A Lot More – This Is Just A Sample of The Style, Content Matter, and In-Depth Analyses You’ll Find in All Marketdata Reports