Why The Disaster Prep Industry is Booming

  60% of American families have noemergency plan or supplies in place. 

People in their early 20s arereally keen on having a 72 hour kit or having amonth's worth of food. And what we find that is that it'shuman nature to engage in what we call conformity. And I think when in doubt,people do what other people do. The waters can sweep across and floodall low-lying areas, so no sense in building a shelter if you're goingto be under the water permanently. Over the last five years, as weatherrelated events have increased in both frequency and strength, the global emergencyrelief market has become a $10.5 billion industry. 

What onceseemed like extreme doomsday preparedness measures are now becoming the norm. For years, doomsday preppers werewritten off as conspiracy theorists. Now, this used to betied to the Cold War. but nowadays this isa fresh, booming business. According to theWorld Meteorological Organization, 2016-2020 is projected to be thehottest five year period on record. Emergency relief revenuesaw a 21.7% increase following the2017 climate disasters. For a growing number ofconsumers, emergency preparedness isn't just logical, it's a necessity. Here's how emergency preparedness wentfrom a conspiracy theory obsession to a multibillion dollar industry. This is Suddenly Obsessed. According to the United Kingdom's SternReview, the likelihood of human extinction over the next hundred yearsis about 9.5%, which means the threat of disaster is very real. 

In the last three years alone, Californiasaw the number of acres burned in wildfires increase from roughly 500,000in 2017 to nearly 1.5 million in 2020. Hurricanes also reached record strength in2017, which was the first time three category four hurricanes made landfallin the United States in a single year. Brandon Erikkson, vice presidentof sales at Emergency Food Supplier Readywise, says the increasein weather-related disasters has put emergency food kits in high demand. Sales have grown probably byfive or six times overall. Readywise, formerly Wise Company, started in2009 as a response to the 2008 recession and the steadyrise in climate disasters that followed. Revenue of the business grew by10 times between 2010 and 2011. 

The product was really designed to helppeople in the event of an emergency have something to really provide aninsurance policy in terms of feeding your family. Readywise produced over35 million meals in 2020, and a 120 serving size bucket likethis costs $299 and has a 25 year shelf life. Just becauseReadywise products are selling well doesn't mean they taste good, so I'mgoing to try Readywise's potato and chicken pot pie. So it looks like thepot pie has a good amount of dehydrated vegetables. You can definitely tell these aren't freshvegetables, but if I had to eat this for a meal, I don'tthink I would hate it. While the brand saw a five foldincrease in direct purchases of their products in 2020, some of theirbiggest clients are government aid groups and nonprofit organizations. Following the 2017 hurricane season,the Federal Emergency Management Agency requested 2,000,000meals from Readywise. 

Traditionally, Readywise has seen most oftheir direct consumer demand come from coastal areas heavilyaffected by storms. But this year, things were different. If you hope to find handsanitizer, disinfecting wipes, shelf stable food, you might be out of luck right now. In 2020 we've seen itfeels like everybody's buying. We're shipping it everywhere. And in some cases, theshipping requests come from underground. Every day we have people thatspend tens of thousands of dollars on emergency food for theirbunker or their second home. The increase in powerful storms likeSandy and Harvey are not only impacting how people live,but where they live. Over the last five years, the U.S. has witnessed some of thecostliest storms on record. In 2017, Hurricane Harveycaused an estimated $125 billion dollars in damages, temporarilydisplacing some 30,000 people. As migration patterns pushed more Americansinland, those who want to take it one step further havea solution: underground bunkers.

 We pick locations based on their safety, so we have a model,and that is high and dry. So we want to be very high altitudeor as high as we can get. We also like to be far awayfrom all large bodies of water. This is South Dakota. It's mean elevation is about2,200 feet, and underground are Vivos bunkers. Vivos has become, over the 12years, it's become an institution. And I would say that it started as... it was almost urban legend. Robert Vicino first had the ideafor Vivos bunkers in the '80s. Two decades later, he beganbuying large, vacant underground spaces, some former military bunkers. He then built out shelterspaces for the middle class. Prices vary for Vivos's dozen or solocations, but the company had a $7,000 bunk bed option priorto covid-19, and a fully-outfitted, family-sized bunker at the SouthDakota location runs about $145,000. And Vicino says sales areup 400% in 2020. After covid-19 hit the United States,some of his clients even started living underground full time. They love it. They lovebeing off the grid. They love being away sofar away from society. Doomsday bunkers like these were once seenas a taboo investment of the rich and famous. But during uncertaintimes, everyday people are going to extreme measures for asense of security. 

I do think that the people who havetipped via covid and all the other pandemics we've had in the country, Ithink that that definitely is going to lead to an increase in buyingbehavior in a large majority of the population. According to Dr. Chapman, when the brain senses danger,there's an immediate impulse to engage in group behavior, which explainsthe nationwide, manic rush to buy toilet paper at the startof the covid-19 pandemic. Nobody prepares for a 30% surge ina single category, but that's what they saw in  things like toilet paper. 

And what we find that is that it'shuman nature to engage in what we call conformity. And I think when in doubt,people do what other people do. So if you see people at a supermarket,at a target or whatever it may be, and you find that the bottled wateris gone, what you find is, gee, psychologically, perhaps I need that. Why is everyone else doing that? Am I not in the know? Am I missing something? So innately, it triggers anxiety in otherpeople, and when in doubt you're going to conform towhat you see, right? But still, no one really knows whenthese events are coming, and that concerns Dr. Chapman. So anxiety in normallimits is very helpful. But when it's chronic, in thecase of maybe doomsday preparation, I'm engaging in emotional behaviors to tryto prepare for something that may or may not occur, and thereforethat can be pathological at times. But given reports about global leaderslike Bill Gates owning bunkers and creating underground seed vaults, it's nowonder so many people are trying to get ahead ofan impending global catastrophe. 

In the United States, disaster relieffunding is distributed from the Department of Homeland Security via FEMA,which has a $14.5 billion budget for 2020. But according to IbISWorld,that funding will only grow marginally over the next 5 years,meaning if climate disasters worsen, private donors and consumers will have tofoot more of the bill for disaster relief. We launched JUDY in January 2020,and we are prepared over 10,000 households across everystate in America. It's been huge. Simon Huck is well-versed inthe art of business. So when he and his business partnerhad the idea to create a highly-curated emergency kit, he wasdetermined to see it through. We knew that based on what we wereseeing and the interest that we had from people who had been in emergencies,that there was a desire for emergency preparedness. It just wasn't packagedin the right way. Huck is the head of an acclaimedentertainment PR group and has close ties with Hollywood's elite. But even his circle wasn'timmune to emergency preparedness needs. The genesis for JUDY involved havingso many different friends and family who had been in emergency situations andwhether it was a wildfire or a flood, storm surge, household fire. And the common denominator in all ofthese stories was a fundamental lack of preparedness. 

JUDY's biggest competitionwhen entering the emergency relief market with theAmerican Red Cross. The American Red Cross was chartered bythe government in 1905, and it's the largest government aid organization inthe U.S., with revenue reaching a reported $2.9 billion in 2019. But their first aid kits arelargely designed for medical needs, and sometimes disasters call for more. That's where JUDY comes in. Emergency preparedness isn't sexy. So we knew when designing it notonly from a branding perspective, but also a marketing perspective, we neededto appeal to people that didn't want to havethose tough conversations. The JUDY kids range from $45 to$250 and come in for sizes. The safety kit is filled withbasics like gloves, sanitizer, and N95 masks. And the most robust kit, TheSafe, comes with six neatly packed boxes to cover most emergency needs. And this is one of the mostimportant things in an emergency kit. 

It's a hand crank radio. Hand crank radio isessential for emergencies. And we have a biohazard bag inthe event that you need it. We also have a dry cloth. If you're wet, if you're in ahurricane situation, if you're in a flood situation, this iscritically important. Huck has already sold over 30,000kits after launching in 2020. JUDY Kits even made it on toone of the most coveted holiday shopping lists: Oprah's favorite things. With climate disasters like hurricanes, floodsand fires looming, it's hard to know what's extreme and what'spractical in terms of being prepared. I think that many people who havea tendency toward anxiety will certainly use buying behaviors as aprecautionary sort of action. 

My personal opinion is that, yes, Ithink companies do take advantage of that. If 2020 is anymeasure of what's ahead, doomsday prepping isn't some fringe experiment forthe paranoid or the ultra wealthy, it's becoming a necessity.