Horizons newsletter – week 08 // 2019
Horizons is a bi-monthly Dasym Research initiative to show you how the Dasym themes have been in the news. We publish the Horizons on our website and as an email newsletter. If you wish to receive the email, please contact Investor Relations.
Do you have a question about the digitization of consumer’s daily lives? As a research-driven investment company, we want to be relevant to you, so please provide us with your questions and remarks. Your feedback will help us to drive our research agenda.
The changing view on mental health fuels the self-care industry
Mental distress is a global problem. According to the World Health Organization, 450 million people worldwide are living with mental illnesses. In addition, people have to deal with the effects of stress and loneliness on mental health. Gallup, for instance, found an increase in the levels of negative feelings people have – such as stress, anger or physical pain – over the past five years. As our awareness and understanding of mental health is growing, the stigma around mental health issues is diminishing. Mental health is increasingly considered a fundamental component of wellbeing and younger generations are actively focusing on staying mentally healthy. Since rates of depression and burnouts are especially high among millennials in the Western world, their attitudes towards sleep, food, work-home balance, physical exercise, and the use of digital technology are changing. Research found that millennials spend more time and twice as much money on the self-care industry, which includes personal care products, but also meditation apps such as Calm and Mindspace, or home-delivered ‘clean diet and detox plans’ consisting of natural foods.
The return of industrial policy
Only in 1999, The Economist called Germany the “sick man of the Euro”. Fast forward two decades, and Germany has become the undisputed economic power of the Eurozone, driven by its world-leading industrial export sector. However, Germany’s economy is in need for digitization, as its digital infrastructure lags behind those of other countries, and its companies face being beaten by digital giants from China and the U.S. To this end, last week Germany launched its new industrial policy, called the “Nationale Industriestrategie 2030”. This long-term strategy aims to support German champions in 10 strategic and digital sectors, and establishes a state investments fund to pre-empt foreign takeovers of strategically important German companies. With this plan, Germany joins a growing group of large economies actively pursuing an industrial digitization policy, such as China (Made in China 2025), India (Make in India), Saudi Arabia (Saudi Vision 2030) and Japan (“Abenomics”). Since Germany has the financial resources, given its large fiscal and current account surpluses, we could expect a new surge of digital innovation coming from Germany.
Popularization of podcast platforms
The podcast market is growing fast in terms of users, usage and advertising revenues. Considering the fragmented nature of the market and the low barriers to creating podcasts, opportunities are emerging for platforms that aggregate and monetize podcast supply and demand. Podcast producers are likely to be interested in a YouTube-like platform that provides production, hosting and monetization (through advertising and/or subscriptions). Users meanwhile are attracted to platforms that provide access to a large source of content. Spotify is already positioning itself as such a platform, considering its recent acquisitions of podcast network Gimlet Media and Anchor, a service for easily producing and distributing podcasts. Publishers like Vox and the Economist are stepping up their podcast investments as well. New companies are also popping up, with Himalaya Media recently raising $100m in funding to establish itself as a new force in the podcast distribution space. Similar to other digital markets, one big player might be dominant – possibly Spotify – but smaller niche parties with different business models could still be successful alongside that big player.
