The Hygiene Industry: Opportunities and Changes
- A pre-coronavirus survey found that a lack of proper hygiene and sanitation costs the world $223B a year
- Every dollar spent on sanitation provides at least $5 in economic return
- The future of the industry will be shaped by COVID-19 and future viruses, and will impact all people and businesses in new and unexpected ways
- Changing hygiene behaviors and perceptions have created fertile ground for startups
- Opportunities abound, including innovations in far-UVC light, antimicrobial fabrics, food traceability, and hand-washing interventions
* * *
Adapting to a Post COVID-19 World
Picture this: It’s April 2021 and you’re meeting a friend for dinner. You can’t decide where to go because your favorite tapas place is closed — communal food is a thing of the past. You eventually agree on a spot, but it’s hard to get a reservation since restaurants are only accommodating half their normal number of patrons.
While you might make the 6pm train, you call an Uber instead because you don’t want to risk having to squash yourself into a crowded subway car. Your health and wellbeing are worth the extra money.
Perceptions and behaviors relating to hygiene have changed forever thanks to the coronavirus pandemic. Although we might not yet know exactly how things will change, one thing’s for sure: You can say goodbye to hugging and shaking hands with strangers. And you might not want to press that elevator button or touch that restaurant menu — at least not without sanitizing.
No single industry will be left untouched by COVID-19. But if there’s one industry with potential for far-reaching impact that will benefit society as a whole, it’s hygiene.
According to the Bill and Melinda Gates Foundation, the lack of proper hygiene and sanitation costs the world $223B every year. The Gates Foundation estimates that every dollar spent on sanitation worldwide provides at least $5 in economic return. This was true even in a pre-coronavirus world, in which most people and businesses weren’t focused on hygiene anywhere near as much as now.
The world of hygiene and sanitation has to be reimagined for businesses of all kinds. And the pandemic has reinforced the fact that hygiene applies to all businesses and all humankind. Now more than ever, businesses, their employees, and their customers are going to be focused on hygiene, sanitation, and disease transmission vectors.
The global pandemic has also sparked a new, widespread need for education and training on proper hygiene practices, as well as the emergence of new industry trends, and perhaps entirely new industries.
There are a wealth of opportunities for entrepreneurs innovating in this industry. In this report, we’ll look at how this space is evolving and break down opportunities through 4 “mini-signals,” including:
- Ultraviolet everything: Far-UVC light can kill airborne viruses without causing harmful radiation to humans
- Food provenance: Stricter, global standards for food traceability
- Hygiene fashion: Antimicrobial fabrics and stylish face masks
- Hand-washing interventions: Long-term changes in hand washing behaviors
History and Evolution
The hygiene industry is fragmented, with individual sectors ranging from personal hygiene to cleaning products and hygiene devices. The personal hygiene market, valued at $52.4B in 2018, is gaining significant traction in the wake of rising health concerns coupled with increasing willingness to spend on personal hygiene. The arena is concentrated, dominated by conglomerates like Unilever, Johnson & Johnson, and P&G. However there is still space for various startups, such as This is L. (feminine hygiene products), AAT (disposable absorbent products), and PeeSafe (toilet seat sanitizer), to challenge and be acquired by industry incumbents.
The hygiene and sanitation industry beyond personal hygiene encompasses a number of sectors including devices, cleaning products and services, and sanitaryware, among others. While the issues of sanitation and “hygiene culture” have historically been something that primarily governments and development agencies, including the Gates Foundation, are concerned with, the role of the private sector is expanding as startups of all kinds have rushed into the space. For example, the hand hygiene market alone is expected to grow at a compound annual growth rate (CAGR) of 6.2% to $1.98B in 2023 with companies such as SwipeSense, Hand Wash Coach and PathSpot entering the fray.
The future of this evolving industry will be shaped by COVID-19 and will impact all people and businesses in new and unexpected ways. This is prompting people to think about what an intrinsically hygiene-conscious society would look like. The idea of a hygiene culture is deeply rooted in countries like Japan. The Japanese are notoriously clean-conscious, and give us a window into how a hygiene culture could manifest in the West in years to come.
For example, in Japan, there are various kinds of wiping tools, each used for a specific purpose: “zoukin” is multipurpose but avoided as a finishing tool, “fukin” is only for washing dishes and cooking tools, “daifukin” is only for wiping tables and “tenugui” is mainly for wiping hands.
Moreover, the Japanese do not wear their “street shoes” into their homes, they always wear a surgical mask in public and disinfect public bathroom stalls before and after they use them. The Japanese culture is one of very little “skinship”, where bowing and nodding are favored over hand-shaking and hugging when it comes to greeting.
Many of these hygiene practices are inextricably linked to religion. Cleanliness and purity are central tenets in both of the major religions in Japan — Buddhism and Shintoism. However, the fact that basic personal hygiene practices are taught and enforced from a very young age plays an important role. For example, students must wash their hands several times a day. After bathroom breaks, everyone washes their hands together at hand-washing facilities located in corridors where teachers can supervise. Hygiene habits are reinforced by weekly hygiene inspections: Students on the health committee check if everyone has a handkerchief and tissues, and if fingernails are clipped short.
There are many reasons that countries like Japan, Taiwan, Singapore, and Vietnam have been relatively successful in managing the pandemic when compared to the West, not least of which was the speed at which they acted to contain the spread of the virus. Deeply entrenched cultural attitudes towards hygiene, coupled with hygiene practices that are still in place following the 2002 SARS outbreak are also central to their success.
Just as SARS was a morbid kind of dress rehearsal for COVID-19 in Asia, the coronavirus pandemic will serve as practice for other 21st-century crises that are sure to follow as the world becomes increasingly globalized. Personal hygiene practices and hygiene culture more generally will transcend countries like Japan and begin to permeate the western world.
Competition from incumbents will be a significant threat to companies in the personal hygiene industry. A new report produced by the American Economic Liberties Project concludes that “a few large corporations control the majority of the products and brands we see… [they] dominate [the market] in part by acquiring and hiding behind a multitude of brand names, which present the impression of robust choice and competition”. The report goes on to outline a number of these monopolistic corporations in the personal care industry:
As this category evolves, many new challengers will enter the market to take advantage of the opportunities created by changing hygiene perceptions and behaviors. This shift is likely to have downward pressure on prices, which will not be easy to stomach for small- and medium-sized businesses. The strong foothold of large and international players is a barrier to entry for startups, who will need to differentiate their offerings through continuous product innovation, research and development, and customer service.
A number of D2C toilet paper startups are doing just that, and riding the wave of global shortages of toilet paper in retail outlets. Peach, for example, a luxurious 3-ply toilet paper that comes in pink packaging, saw a 267% increase in sales in the first 2 weeks of March. No. 2, a bamboo toilet paper that comes in stylish print wrappers, saw a 1,643% surge in sales on Amazon in the first week of March.
Longevity of COVID-19 Trends: It is unclear how long these startups will be able to ride the COVID-19 wave. While there are indications that some hygiene behavioral changes (such as hand washing), will outlast the pandemic, it remains to be seen how long people will continue to pay $3 per roll for luxury toilet paper once things return to relative normalcy.
Regulation: From transport to food safety and occupational health, we are already seeing various new restrictions, laws, and legislation put in place to avoid a similar outbreak in the future.
In Beijing, a range of new regulations banning “uncivilized behaviors” were passed in the last week. Behaviors including not covering the mouth and nose when coughing or sneezing, not wearing a mask in public when ill, and going shirtless, are now finable offences. And if you didn’t already feel like you were living in an episode of Black Mirror, the new laws also encourage police to report serious offences, which may affect a person’s or corporation’s social credit score – a fledgling system which aims to monitor individual, corporate, and government behavior across the country in real time.
Changing market dynamics create opportunities for entrepreneurs to capitalize. For example, we explored ways in which entrepreneurs can help businesses respond to new healthcare and disaster-preparedness regulations that will force companies to spend billions of dollars on compliance. However, the regulatory uncertainty will cause turbulence along the way for incumbents and startups alike.
4 Opportunities We Identified
1 – Ultraviolet Everything
The Signal: You can add “ultraviolet smartphone sanitizers” to the list of products of which there is currently a global shortage (along with toilet paper, of course). According to iCentral Mobile, a distributor of Momax UV phone sanitizers, sales of their UV box sanitizers jumped 10X from February to March. Lazada says its sales of ultraviolet (UV) box sanitizers in March was 7X that of February, and sales in the first week of April have already matched that of the entire month of March. In the US, PhoneSoap has sold out its inventory and is asking for customers to pre-order on its website. Casetify in Hong Kong, which launched its UV box sanitizer at the end of March, sold out of its product within days of launching.
In mid-April Dr. David Brenner, a researcher at Columbia University, reportedly discovered that a narrow band of UV light called far-UVC light can kill airborne viruses without causing harmful radiation to humans. Brenner’s team has already tested 2 seasonal coronaviruses, and is testing the current strain, SARS-CoV-2.
UV light is widely used in hospitals to disinfect and kill germs. However, the World Health Organization (WHO) has advised that UV lamps should not be used to sterilize hands or other areas of skin, as UV causes radiation. However, the claims that far-UVC light can kill germs without causing damage to humans may be a game-changer.
The Opportunity: While COVID-19’s resistance to UV and UVC light still needs to be tested extensively, this has not stopped people from searching for and buying UV devices:
Unsurprisingly, there has been a similar explosion of interest in UVC on Amazon, where for example, 500W UVC bulbs brought in $170k in revenue last month.
UV and UVC light products are not limited to lamps, bulbs, and wands. If UVC proves to be successful in preventing the spread of COVID-19 without causing harm to humans, there will be a significant opportunity for entrepreneurs to innovate with UVC in various ways. UVC installations in public spaces and private homes will become commonplace. We will likely see a number of consumer and medical-grade UVC products ranging from multi-purpose sterilizers to custom-built phone, toothbrush, handrail, shoe, surface, and even skin sanitizers.
2 – Food Traceability
The Signal: The food traceability industry has evolved in recent years, with blockchain technology at the forefront of innovation. The outbreak of COVID-19 has meant that consumers’ focus on food safety and provenance is more acute than ever. Even before the global pandemic, which is largely believed to have originated in a fresh food “wet market” in China, the food traceability market was expected to reach $22B by 2025.
On March 16, 2020, the first iteration of global standards for seafood traceability, developed by the Global Dialogue on Seafood Traceability (GDST), was released. The aim of the initiative is to solve the problem of traceability in the seafood supply chain. While there are dozens of methods and hundreds of individual systems for documenting seafood traceability, these systems are uncoordinated and inconsistently applied. Data systems that do not interact with each other, coupled with inconsistent demands for information coming from governments, NGOs, and retailers, were the catalyst for the development of the standards.
The GDST standards are an extension of the international traceability standard known as GS1 EPCIS, which is widely used by more than 1m retailers, brands, and supply chains across food and nonfood product classes.
The Opportunity: The adaptation and development of global traceability standards for specific industries may very well be accelerated by the COVID-19 pandemic, and at the very least, food traceability and provenance will be thrust into the spotlight.
Traceability Solutions: There has been significant investment in food traceability startups in recent years. In 2018 startups focusing on the middle of the supply chain gained popularity among venture capital investors, raising nearly $1.35B across 167 deals, a 44% increase in funding compared to 2017. Startups in the space range from software and blockchain technology companies to edible food sensors.
While there is still opportunity in the space to deliver traceability solutions, one of the biggest problems that still needs to be solved is the issue of interoperability between a multitude of systems and solutions.
Traceability Signaling: Companies that invest heavily in ensuring traceability of their products will be looking for creative ways to signal this to their customers. One of the ways in which this is already being done is with smart labels and QR codes on food packaging, which allow consumers to see the origin and movement of a product before they buy it. The need for signaling is likely to emerge beyond food traceability. Uber, for example, may want to signal to their riders when the car they are about to ride in was last cleaned. The restaurant industry may develop a social distancing scorecard. There is an opportunity for entrepreneurs to help companies to signal product provenance and hygiene practices to their customers.
Data Collection: Compliance with standards such as those developed by the GDST will come with a heavy data collection burden for all players. Large multinationals and small-scale fisheries alike will be required to capture data, in the correct format, on elements such as catch area and vessel identification. There is a gap in the market to make data capture possible and easy for small-scale producers, like smallholder farmers and small-scale fisheries, most of whom go on the water with only their phones.
3 – High(giene) Fashion
The Signal: It seems that there is not a single industry that will be left untouched by the COVID-19 outbreak, and fashion is no exception. Antimicrobial fabric and textiles have been thrust into the limelight in recent weeks.
Antimicrobial fabric is fabric treated or infused with antimicrobial agents to keep microbes such as bacteria and viruses from flourishing within its fibers. To date, these fabrics are primarily used in bed dressings, drapery, and gowns, as well as in filters, packaging, and uniforms in various industries. Other antibacterial specialty fabrics such as those infused with zinc and copper oxides or silver ions are also in the early stages of development.
While these fabrics are primarily used in personal protective equipment (PPE) for healthcare professionals, consumer demand for antibacterial-everything may bring these fabrics into the mainstream fashion industry.
The Opportunity: Antimicrobial fabric is already used in athletic wear, and may very well make its way into everyday wear. However, the opportunities in post-COVID fashion go beyond fabric.
Protective face masks are big business in Japan. In 2018, more than 5.5B masks were manufactured in Japan, 80% of which were for personal use. Fashion-statement face masks are commonplace in Japan as mask wearing has become ubiquitous.
Even though face masks are a recent phenomenon in the West, it has not taken long for consumers to demand fashionable versions of these hygiene wearables:
Entrepreneurs can capitalize on the fact that people are willing to pay for a stylish version of almost anything (ex: some masks cost as much as $100 a pop). This trend will likely extend beyond clothing and PPE. There are also opportunities to make premium personal hygiene products and accessories, such as this brass antimicrobial door opener, and this next-generation portable sanitation kit.
And what will enforced public mask-wearing mean for lipstick and other make-up products? As most of the facial real estate is removed from the public gaze, will we see more women investing in elaborate eye make-up and accessories? Even before COVID-19, some women in Japan were choosing to wear surgical masks so that they could get away with only applying eye make-up and not having to bother with the rest.
4 – Hand Washing Interventions
The Signal: Thorough and frequent hand washing has been singled out as the most effective way to prevent the spread of COVID-19. People are washing their hands more than ever before — up to 16 times a day in the US — a behavioral shift that is set to continue. A survey in China found that, of all the recommended hygiene practices, respondents are most likely to continue washing their hands after the COVID-19 outbreak.
Studies have shown that pandemics significantly affect long-term perceptions of hand hygiene and sanitation. For example, a German study that looked at hygiene perception changes during the H1N1 pandemic found that from 2008 to 2009, the proportion of people who perceived the efficacy of hand washing as “very good” increased from 50.9% to 61.1%.
The effects of the COVID-19 pandemic on hand hygiene perceptions and behaviors may be even more pronounced as a result of social pressure. A 2017 survey found that people are more likely to wash their hands or to wash their hands more thoroughly if they are in the presence of other people. The coronavirus pandemic has been widely documented by social media users the world over. For example, the WHO partnered with TikTok to start a #SafeHands challenge, which encourages people to post videos of themselves washing their hands for 40 seconds. The hashtag #SafeHands has 97k posts on Instagram, 278k tweets, and 4B views on TikTok.
The Opportunity: Unsurprisingly, search interest around hand washing-related topics has soared over the past few weeks, with consumers and business owners looking to educate themselves and their employees on hand washing best practices:
- “Hand washing steps”: 33.1k searches /month
- “Hand washing technique”: 9.9k searches /month
- “Hand washing posters”: 9.9k searches /month
- “Hand washing song”: 2.4k searches /month
- “Hand washing facts”: 1k searches /month
Source: Keywords Everywhere
There are opportunities throughout the hand-washing cycle, from pre-wash education to post-wash pathogen detection.
Educational content: There are opportunities for entrepreneurs to create B2B and B2C educational programs and videos around hand washing best practices and outcomes (ex: “hand washing for kids” has 2.9k searches per month, and “hand washing video” has 1k searches per month).
Apps: Apps and tools that can help people to form hand-washing habits are gaining popularity. Samaung, for example, has just added a hand-washing feature to its Galaxy smartwatches that sends hand-washing reminders.
Wash Your Lyrics is a web app that has had over 1.2m site visits since its launch in February 2020, according to SimilarWeb. The app, developed by a 17 year old, allows you to pair a National Health Service infographic on hand-washing techniques with your favorite tunes.
The SureWash app combines e-learning, gamification, and gesture-recognition technology to help users learn and memorize correct hand washing technique through short training sessions and real-time feedback to the user.
Devices: The hand hygiene device market is expected to grow from $66.8m in 2018 to $90.5m in 2023. We spoke with the founders of PathSpot who indicated that demand for their post-wash hand scanner device has skyrocketed. While the device was originally designed for use within the food service industry, the company has received inquiries from a range of verticals and even consumers who want to install the device in their home.