Motivating a Modicum of Exercise: The Healthtech Opportunity

“It’s been a busy few weeks for product announcements in the world of fitness,” industry observer Anthony Vennare recently commented, citing the latest offerings from the Peloton, Mirror, Tempo, and other digital fitness platforms.

On the one hand, these developments are encouraging, offering customers pursuing fitness — and who are willing and able to afford the steep premiums — a greater range of options.

At the same time, when you look at these products – and the slick ads that often accompany them – it’s pretty clear that the target market is the already fit, or at least the fit-adjacent. While certainly some previously sedentary people have been inspired to start riding a Peloton or rowing a Hydrow, the inactive do not appear to be the main customers these digital fitness companies are pursuing.

Which, from a health perspective, is really too bad.

Here’s why.

Minimal Exercise Is Unreasonably Healthy

There are plenty of data arguing that exercise is good for you, and a huge amount of ink that’s been spilt trying to define the ideal weekly threshold.  But if you are really looking for the most bang from your buck – the most benefit for the smallest change in amount of weekly exercise – the data seem remarkably clear. 

Going from inactive to exercising a little bit each week seems to result in a disproportionate boost in your health, including specifically years of added life. The amount you benefit if you make this relatively small change in weekly exercise is roughly equal to the benefit you can expect to receive if you then go from exercising just a little to exercising intensively, all the time.

As Andrew Yang might say, it’s just math – and in particular, the shape of the benefit curves. (See Figure 1 of this 2012 paper by Steven Moore and colleagues at the National Cancer Institute, and Figures 2 and 3 from this 2017 review by Warburton and Bredin of the University of British Columbia.)

Earlier this year, I discussed what seemed like an important opportunity for digital fitness companies to target these customers – a need for what investment banking analyst Aarti Kapoor called the “Planet Fitness of the Digital World.” 

For Kapoor, this opportunity reflected a market gap revealed by her economic analysis, but if you layer in the disproportionate health benefit from serving this population, the need for such an offering seems that much more compelling.

Motivating Small Activity Is A Big Challenge

So why haven’t more digital fitness companies seemed to have targeted this demographic?

One reason: it’s easier to persuade someone who’s already active to try out a different product than it is to convince an inactive person to get off the couch in the first place.

A second reason might be the intangibility of the benefits: a previously sedentary individual who now exercises a little every week might be significantly better off from a health perspective, but might not feel all that different, or look all the different, and might regard themselves as still fundamentally deconditioned.

A related challenge is the Peltzman Effect – the tendency to compensate for a reduced risk by feeling more comfortable engaging in riskier activities. You can think of it like permissioning; for some, wearing a seatbelt justifies driving faster; a skateboard helmet makes it easier to contemplate more dangerous tricks. In the area of health and fitness, I imagine this tendency might be renamed the “Diet Coke Effect,” since making one healthy choice (like opting for a calorie-free beverage) often seems to justify indulgences (say a package of Yodels) that can more than offset the potential benefits of the first decision. 

While this challenge impacts all of us – it’s easier to justify ice cream after an intense workout – it’s easy to imagine that any potential health benefit of slightly increased exercise might be lost if the activity made it easier to justify additional caloric consumption.

There are also a range of what might be termed structural obstacles, as Dr. Michael Joyner of the Mayo Clinic pointed out to me, ranging from challenges in the built environment (e.g. “neighborhoods that are either not safe or not walking friendly”) to economic factors to limited opportunity for active transportation.

No one ever said it would be easy.

At the same time, it’s difficult not to be impressed by the engagement of emerging digital fitness technologies; Peloton is arguably a leading example of this, as I’ve discussed –also here).

Who Will Figure It Out?

So, first question: where will the digital health company serving the inactive come from? Will it emerge from a sophisticated digital fitness player like Peloton developing a new offering that targets a different demographic (with all the attendant risks to the brand), or from a company like Planet Fitness, developing digital offerings that deeply engage and encourage the currently sedentary?

Alternatively, might it come from a wellness and mental health brand like Noom, Headspace Health, or Happify Health, seeking to extend their program with a fitness hardware component? Or might the winning entry be something yet to be created?

Second question: if a company does develop a compelling offering, will the benefits delivered be robust enough, and achieved rapidly enough, to meaningfully reduce health costs – what I often think of as the Al Lewis test. 

This deceptively simple goal represents a remarkably difficult challenge, as I’ve recently discussed, but one that, if met, would obviously be of exceptional interest to self-insured employers, as well as payors seeking to promote disease prevention and encourage health maintenance.

We may get some early visibility into the first question from Aarti Kapoor herself, who has recently left her investment banking job to become CEO of a SPAC — “VMG Consumer Acquisition Corp”— that went public just this week. The stated intention of this blank check company is ”to identify and complete a business transaction with a company in the high-growth consumer and retail industry.”

Given Kapoor’s previous interest in a digital fitness offerings focused on the less active, it’s exciting to contemplate the possibility that she might identify a promising high-growth company in this category.

Whether or not Kapoor invests here, the space remains compelling from both a business and health perspective. It represents an important opportunity for aspiring healthtech entrepreneurs.