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What is the USA market-size (TAM) for the Employee financial wellness platforms industry?
Hello! Thank you for your question regarding the USA market size for employee financial wellness platforms industry. We have used T Rowe Price report, PRWeb and MyShortlister in order to answer your question. In short, the estimated market size of financial wellness platforms (technology players) by end of 2018 will be about $226 million. The sector is to see ' explosive growth' in the next few years. Below you will find an explanation of the methodology and findings in detail.
METHODOLOGY
In order to answer your request, we looked ta multiple reports on financial wellness by CNBC, WorldatWork, SHRM and other media sites. We were only able to get the top players in this industry using the reports published by T Rowe Price and MyShortlister. Multiple studies have been conducted on benefits of financial wellness but the market size estimate is not available anywhere in the public domain. Articles published in PRWeb and LinkedIn indicate that this industry is going to see an explosive growth but the growth estimates are also not available. So, in order to come close to an estimates we followed the below approach.
We looked at the top platforms players in this sector using these reports. Then, we found their respective annual revenues using Owler and Manta . We did so for 15 companies. Since these were the top players in this segment, we assumed that they would represent about at least half of the revenue in financial wellness sector. Then using this figure we estimated the total market size for financial wellness platforms. Then, in order to get an estimate the market size for 2018, since multiple reports indicate an explosive growth, we assumed about 20% growth in the next 1 year. Using this assumption, we were able to get the projected market size of financial wellness for 2018. The complete data can be found in the spreadsheet attached here.
Despite extensive research, we were unable to estimate the sub-sectors due to lack of any quantitative data publicly.
FINDINGS
As indicated above, due to the lack of quantitative data for the financial wellness sector, we estimated the market size using the annual revenues of top players in the sector. In the USA alone, there are 300 players in the financial wellness platforms (technology) sector. It is also estimated that 8 in 10 employers will adopt a financial wellness program by end of 2018.
Mint.com, Everfi, HelloWallet, GuideSpark and others are a few top players in the sector. The total revenue of these top 15 companies is approximately $78.5 million(we have calculated in the spreadsheet here). Since these are top players, we assumed that they contribute at least 50% of the sector's revenue. This means that the total market size is double of the top 15 companies' revenues. Therefore, the total market size of financial wellness platforms is $157 million as of 2016.
Since the sector is seeing explosive growth, we have assumed that it will in double-digit and have taken a figure of 20% year on year growth to estimate the 2018 figure. This gives us that by end of 2017, the total market size will be about $188.4 million ($157 million +(0.2*$157 million)) and by the end of 2018, the market will be about $226 million.
We looked for data on sub-sectors such as financial wellness coaching, data mining etc so as to be able to estimate but the data is very, very limited to project an estimate. Hence we were not able to do so.
However, we have found that the financial education spending in the USA according to Consumer Financial Protection Bureau, was about $670 million at the end of 2013. This, if we assume a growth of 5%, year-on-year, the spend on financial education would have been about, by the end of 2016, $775 million.
We have also found that financial wellness services are charged about $1-$2 per participant as fees and this also depends on the size of the engagement.
We were also able to find the monetization models adopted by financial advisors who are engaged with employers. This has been published by SourceMediaResearch in 2015. They are
SUMMARY
1. The estimated market size of financial wellness platforms (technology players) by end of 2018 will be about $226 million. The sector is to see ' explosive growth'.
2. The financial education spend in the USA at the end of 2013 was $679 million and estimated to be about $775 million in 2016.
3. Sub-sector estimates could not be done due to lack of any publicly available data.
Hope you find this information useful. Thank you for using Wonder! If you have any more questions, please let us know!