Internet Trend Searches Show Some Signs of Cosmetic/Elective Procedure Softening; Is it the Canary in the Coal Mine for a Softening Healthcare Consumer?

One of the best leading indicators for elective procedure trends is internet search activity. 81% of consumers do online research before making a major purchase and the average timeframe from the start of research to purchase is 79 days. Given scheduling and consultation timeframes, this timeline is even longer for cosmetic surgery and elective medical procedures. Typically, in a recessionary environment, cosmetic procedures see a much more significant impact and are the first to be impacted from a weakening consumer environment. We’ve already seen cosmetic surgery linked stocks such as aesthetic laser manufacturers, breast implant manufacturers, and cosmetic procedure equipment manufacturers have a rough 2023 despite most having record sales or only small declines in revenue to date (ALUR, APYX, SSKN, CUTR, ESTA, SIEN). However, search trend data appears to indicate that more challenging financial trends could be on the horizon given what appears to be softening consumer trends based upon search data. Below, we highlight search data from some of the most common cosmetic and elective procedures. Given the increase in consumerism around healthcare with the average family plan deductible around $4,000 based upon data from the Agency of Healthcare Research and Quality, we could see consumer changes increasingly bleed over into other elective procedures such as elective genetic testing, eye surgery, medical imaging and diagnostic procedures, and elective surgical procedures.

We evaluated several major cosmetic and elective procedures to get a sense for overall trends and potential consumer impact in these markets. We would note that there is seasonality in many of these trends as many cosmetic procedures appear to peak in winter/early spring and trough in late summer/early fall with summer activities and back-to-school. This should be taken into consideration when evaluating the data.

Rhinoplasty(Current Reading: 70, Decline from Peak: 30%, Pandemic Low: 47)

Breast Augmentation (Current Reading: 48, Decline from Peak: 52%, Pandemic Low: 46)

Liposuction (Current Reading: 43, Decline from Peak: 57%, Pandemic Low 38)

LASIK (Current Reading 48, Decline from Peak: 23%, Pandemic Low: 21)

Laser Skin Treatment (Current Reading 75, Decline from Peak 25%, Pandemic Low: 25)

In conclusion, consumer search activity for elective procedures appears to be declining and is a leading indicator of future demand trends. As consumers increasingly turn to online research before making major healthcare decisions, the dynamics of this industry are shifting. Historically, cosmetic procedures have been swift to reflect economic downturns, and early indicators suggest that this trend might persist in the near future. The impact is already evident in the performance of related stocks but further financial weakness could exacerbate trends. Moreover, as consumerism plays a more significant role in healthcare choices, we could witness these trends extend beyond cosmetics into other elective medical domains.