Hey Hot Potatoes,

Welcome to the latest edition of the Hot Potato Newsletter! Just when you thought your local coffee shop was all about flat whites and oat milk, they've gone and done something that's got traditional hospitality scrambling to redefine itself – they've become wellness sanctuaries.

And I mean properly transformed. We're talking about cafés serving adaptogenic mushroom lattes that promise stress relief, spas opening organic juice bars and luxury hotels integrating biohacking labs into guest rooms. The lines between where we eat, stay, exercise and heal are dissolving entirely.

The numbers are absolutely staggering: The global adaptogenic beverages market hit $1.4 billion in 2024, projected to reach $2.5 billion by 2034. The UK spa market reached £4.1 billion in 2024, expected to hit £13.7 billion by 2034. Meanwhile, wellness tourism is projected to maintain annual growth rates of 14.7% for trips and 16.6% for expenditures through 2027.

In today's newsletter we ask: Genuine wellness revolution or expensive lifestyle marketing? We'll dive deep into how coffee shops became functional beverage labs, decode the spa-café hybrid boom and reveal whether this convergence represents the future of hospitality or just costly adaptogen-infused hype.

In today’s email: The Wellness Revolution Blurring Every Line in Hospitality

Read Time: Approx 4-5 mins

Why This Convergence Is Happening Now: Three Unstoppable Forces

Source: Drinkaware UK - Drinking Trends / Office for National Statistics - Alcohol Consumption 

Before we explore what's changing, let's understand why it's happening. Three massive demographic and cultural shifts are forcing hospitality to embrace wellness and these aren't temporary fads.

Key Points:

• Gen Z and Millennials are driving Britain's sobriety revolution: The proportion of 16-24 year olds who don't drink alcohol has risen from 18% in 2005 to 29% in 2022, according to the Office for National Statistics. The UK low/no alcohol market is now worth over £300 million, growing 30% year-on-year. Younger British consumers are seeking social experiences without hangovers, driving explosive demand for adaptogenic drinks, functional beverages and sophisticated alcohol-free cocktails.

• The post-pandemic wellness awakening became permanent: From 2020 to 2022, wellness trips grew 30.2% annually – 27% faster than overall tourism. The UK spa market's projected growth from £4.1 billion to £13.7 billion by 2034 reflects this shift. British Millennials and Gen Z now view wellness as identity expression and social currency, expecting every hospitality touchpoint to support their wellbeing goals.

• Younger consumers will pay significantly more for health: Toast's survey found 46% of 20-29 year olds and 49% of 30-39 year olds will pay premium prices for organic dishes, with 55% citing health benefits as their driver. This creates a powerful economic incentive: hospitality operators targeting younger demographics must integrate wellness to justify premium pricing.

How Coffee Shops Became £2.5 Billion Wellness Laboratories

Source: Global Market Insights / Future Market Insights / Coffee Intelligence / The Grocer / Blog Preston

When Four Sigmatic announced 11 new product launches by summer 2025 – expanding from mushroom coffee into instant teas, protein powders and elixirs infused with lion's mane, reishi, chaga and ashwagandha – traditional café owners weren't worried. Now with adaptogenic drinks becoming mainstream and functional beverages outpacing traditional coffee growth, those same owners are frantically reformulating their menus.

Key Points:

• Market domination by adaptogens: Ashwagandha holds 35% of the adaptogenic beverages market in 2024, with consumers paying premium prices for stress-relieving properties. Powdered adaptogen coffee is projected to dominate with 40% market share in 2025. Coffee shops are charging £7-9 for lattes that promise mental clarity alongside caffeine.

• UK market acceleration: The UK fermented coffee market is growing at 7% CAGR (customer acquisition growth rate) through 2035, positioned as a clean-label alternative offering gut-health and cognitive wellness benefits. The global mushroom coffee market will grow at 5.5% annually from 2024 to 2030, with British consumers increasingly embracing functional beverages over traditional options.

• Real-world integration: In Preston city centre, Liv Caffè merged specialty coffee, ceremonial matcha and collagen smoothies with a health clinic offering vitamin injections and Japanese head spa treatments. Clients receive complimentary drinks when booking clinic services. Newly opened Elevate Wellness in Bank London, have designed a range of drinks where every recipe is developed in collaboration with a nutritionist and designed with a specific benefit in mind.

The New Third Space: Where Saunas Meet Specialty Coffee

Source: Luna Hut Saunas / ARC Canary Wharf / Rebase

Britain has discovered a category-defying concept that traditional hospitality playbooks never anticipated: wellness spaces where you can alternate between 90°C saunas and cold-brew coffee, meditation pods and oat milk lattes, ice baths and adaptogenic smoothies. Here’s three that have caught my eye:

Key Points:

• Luna Hut Saunas' community model: Luna Hut operates mobile sauna experiences across the South Coast of the UK, combining traditional Finnish sauna culture with post-session refreshments and social gatherings. Their pop-up model brings heat therapy to neighbourhood communities, with packages including herbal teas, cold plunges in natural water sources and seasonal wellness workshops. It's democratising spa culture by removing the luxury hotel price tag.

• ARC's corporate wellness positioning: Located in Canary Wharf's financial district, ARC targets time-poor professionals with express wellness sessions. Members can book 45-minute slots combining infrared sauna, contrast therapy and recovery zones, with an on-site café serving protein-packed breakfast bowls and functional beverages. The model recognises that City workers will pay premium prices for convenient, effective wellness that fits lunch breaks.

• Rebase's Marylebone sanctuary: Rebase has created what they call a "wellness clubhouse" in Central London, merging boutique hotel aesthetics with spa functionality. Their space includes contrast therapy pools, meditation studios, treatment rooms and a full café serving ceremonial-grade matcha and adaptogenic tonics. Members pay £150+ monthly for unlimited access, positioning wellness as an everyday necessity rather than occasional luxury.

Today we've decoded how hospitality operators transformed from service providers into wellness destinations worth trillions, from coffee shops serving adaptogenic lattes to spa sanctuaries where you can feel good and eat good. The convergence isn't slowing – it's accelerating.

I want to know: Would you pay £9 for a mushroom latte that promises mental clarity or is this wellness convergence just expensive marketing dressed up as healthcare?

Now, speaking of hospitality brands completely redefining how they grow... have you noticed how some restaurants fill tables through Instagram alone while others spend fortunes on traditional marketing with zero results? Hospitality brands mastering social strategy are scaling faster and cheaper than ever, while those treating Instagram as a digital menu board are burning marketing budgets with nothing to show.

In our next edition, we're deep diving into how three UK hospitality brands built empires through social media: analysing Roll Boy's founder-led approach that generated millions in organic reach, Fallow's sustainability-focused content that makes people queue for hours and Cocomelt's viral dessert strategy that drives footfall without paid ads.

Ready to discover why some hospitality brands go viral while others stay invisible and learn the exact social playbook that turns followers into customers? Subscribe now for our exclusive breakdown of hospitality's social media masters!

Bon appétit,

Max Shipman, Founder, Hot Potato

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