Sleep health industry prospects

The core prospect of the sleep health industry is not the traffic dividends speculated in the short term, but the 100-billion-level rigid demand track across the three major scenarios of consumption, medical care, and public services in the next 10-15 years. However, it currently faces three core bottlenecks: chaotic standards, serious homogeneity, and low user trust. Players who want to make quick money in the short term will most likely be shuffled. Only teams that truly focus on segmenting demand will have the opportunity to reap long-term dividends.

Last week I went to Guangzhou to visit the largest sleep industry expo in China. As soon as I entered, I could feel the tearing of the industry: there was a mountain of steam eye masks priced at RMB 9 with free shipping at the booth at the entrance. Within two steps, there were medical-grade sleep monitoring beds worth hundreds of thousands of units. The booth of the Traditional Chinese Medicine Hospital next to it also had experience booths for auricular acupoint pressure beans and moxibustion to help sleep. People in line could go around three times. It's interesting to say that I talked with two practitioners from completely different fields that day, and their opinions were very different. The owner of a consumer-grade sleep-aid food was full of excitement when chatting. He said that the search volume of the keyword "sleep aid" on Douyin Xiaohongshu has increased by 370% in a year. Their GABA gummies sold 300 million yuan during live broadcast alone last year. "Now is the time for horse racing. Whoever captures the user's mind first wins." However, Director Zhang of the Sleep Center of Peking University Third Hospital, who was visiting the exhibition, shook his head after listening to it. He took a very popular EEG sleep aid headband and looked through the parameters. He said that the accuracy of this product's most basic deep sleep monitoring is less than 58%, and it can't even touch the edges of clinical reference standards. "Many consumer products are simply IQ taxes that are hot spots. Users buy them back and use them twice, and in the end they will only consume the trust of the entire industry."

Both statements are actually correct. There is a living example around me: my best friend who is an Internet operator is 32 years old and has a history of insomnia for 3 years. She has spent nearly 20,000 yuan on sleep aid products, from imported melatonin and agarwood sleep aid aromatherapy to the sleep monitoring headband she wears every day. I asked her if she found it useful. Well, she rolled her eyes and said, "It's good if one out of ten is useful, but it's better than the side effects of taking sleeping pills every day." This is the most real user status at the moment: the demand is real, the willingness to pay is real, but the satisfaction with the product is extremely low, and the cost of trial and error is borne by the user himself.

Don’t think that this industry is all just hype. Real policies and market signals have actually come out. In 2023, the National Health Commission officially included sleep health into the assessment indicators of the Healthy China Action. Now many community health service centers in first- and second-tier cities have opened sleep clinics. Some insurance companies even launched health insurance products with "discounted premiums for meeting sleep standards" last year. Smartwatches from Huawei and Apple have already regarded sleep monitoring as a standard feature, and are even rushing to obtain medical device qualifications. I recently researched a To B sleep monitoring company in the Yangtze River Delta. They specialize in sleep warning systems for nursing homes. They can provide real-time alarms for elderly people with nocturnal apnea and abnormal rolling over. Last year, their annual revenue exceeded 120 million, all of which were repurchase orders from nursing homes around the world. They didn’t even have to advertise on Xiaohongshu, and just made money in silence.

Of course, the negative voices are not unreasonable. Last year alone, more than 200 illegal sleep aid products were notified by the quality supervision department. Some of the actual melatonin content was five times the labeled value. Some Internet celebrity sleep aid sprays illegally added antihistamines, which will cause drowsiness and memory loss. Many people directly said that "the sleep industry is fake demand. Many people suffer from insomnia because they stay up late every day and use their mobile phones. It is useless to buy more sleep aid products." This statement actually hits a lot of pain points in the industry: many products now don’t even think about solving users’ work and rest problems, but instead create “insomnia and anxiety”. It’s a wonder if they can survive longer.

I have been doing research on the sleep industry for almost 4 years. To be honest, the current state of this industry is very similar to the fitness industry 10 years ago: at the beginning, it was all speculators selling weight loss teas and oil-removing pills. They speculated on the concept and ran away. Later, there were gradually subdivided tracks such as regular gyms, personal training, and sports rehabilitation, and finally they were slowly standardized. Now the sleep industry is also growing wildly. Do you think the future is good? It’s definitely good. The incidence of insomnia among domestic adults is now almost 40%. From sleep deprivation in teenagers to sleep apnea disorder in the elderly, they are all unmet needs. But if you come in with the mentality of making quick money, you will most likely be like the merchants who sold inferior slimming tea in the past. In the end, they will either be fined by regulators or abandoned by users.

That day at the exhibition, I also tried out the medical-grade sleep bed that costs over RMB 100,000. When I lay on it, the softness and hardness just fit my spine. The sensor next to it could measure my breathing and heart rate in real time. I felt a little sleepy after lying on it for less than 10 minutes. However, the price was so prohibitive that it was impossible for ordinary families to buy it. Maybe in five years, after this kind of technology is decentralized, ordinary people can buy a smart bed with sleep monitoring for a few thousand yuan, and then this industry will really enter the lives of ordinary people.