In 2019 the fitness industry grew to ever greater heights. Buoyed on by global government understanding of the value of a healthier population, and an increasingly wide gap between the ultra-wealthy and the middle class, there seemed to be no stopping the march towards success. A younger population less interested in drinking and smoking and a lot more interested in looking good on camera. Fitness had become an affordable luxury and pursuit beyond simply having a summer beach body.
The pandemic can be seen through the prism of the different sections of the industry. For example, outdoor bootcamps were less immediately affected, and faster to open. Large box gyms, reliant on inactive member bases, were quick to close, slow to open and faced financial impacts that could shape the immediate future of the industry and beyond.
Then the pandemic struck and within the space of a few weeks the industry was suddenly plunged into doubt and fear – indoor training seemed like it could be one of the easiest spreading environments.
The industry response was nothing short of incredible. Within weeks it had completely pivoted and was now offering an online version of its classes and keeping members along the path to their goals – and mental health. Beyond that, fitness classes became more than just about fitness and represented often the only community contact that an attendee might have in a day during the lockdown.
We have experienced three main stages so far – the immediate backlash, the response, and the second wave of understanding. Hopefully, they will soon be joined by a fourth, but for the time being here is what we’ve learnt so far and what it means for the fitness industry.
The immediate backlash
The first thing that we saw was that the fitness industry seemed very likely to be hit, and very early. The second thing was that the industry was largely being ignored in favour of hospitality.
This seemed to fly in the face of mounting evidence that health and fitness largely dictated the potential danger of the virus, with the obese and unfit hit most hard. If anything you could say that a reasonable response to the virus would have been mandated weight loss boot camps.
Why was the industry so exposed?
Closed spaces
With rising rents and the popularity of small box fitness, the industry has been working in smaller and smaller spaces. This was a bad sign and there were concerns over viability if class sizes were reduced by a large amount. This immediately looked to impact the most customer-focused businesses – small group and boutique classes.
This didn’t impact personal trainers in the same way, and with this an important revenue stream for most businesses, many clients switched to this format.
Indoor sanitation and cleaning
Quite simply, the perception of many fitness spaces was that of bad hygiene. The reality is of course quite different. Reputation is vital and most fitness spaces recognise that cleanliness and safety are key parts of customer happiness and retention – and even beyond that the ability to stay open in the face of regulations. You could say that the fitness industry was ahead of the game in this respect.
Demographics
Different types of fitness appeal to different age groups. Once it was clear that the virus was less dangerous for younger clients, the immediate fears subsided greatly.
Level of sweat
An early South Korean study showed that low impact exercise like yoga and Pilates were actually incredibly low infectivity risks. The study was based on two infected instructors who taught both a high impact dance based class and also low impact classes on the same day. The clients who attended the high impact class were infected considerably. The low impact class? Zero infection cases.
In March 2020 most fitness businesses closed their doors with the future uncertain. In what will be looked back on as one of the most incredible stories of the pandemic, most did not stop trying to help their clients.
Response
The response of most fitness businesses was to ask:
• How can we help customers maintain their fitness
• How can we ensure the survival of our business
• What does that look like
There were only really two options for business owners – try to stay open and relevant, or shut down for a time and try to survive.
In countries like the UK, this was greatly helped by grants that were made to the hospitality sector, including the fitness industry. However, this was also tempered by the lack of help with rent payments. So, effectively, grants were made to support private landlords. This meant that sitting still wouldn’t be enough.
In shock, and in the space of about two weeks, around 50% of small fitness businesses had switched to an online offering supported by software systems like TeamUp that pivoted to help their community of users.
The response was amazing. Customers didn’t just embrace the new classes… they loved them. Communities coming together
Stuck in lockdown, many customers felt disconnected and lonely. Online fitness classes filled a huge gap and even the before class chat became a key connection point.
Some fitness owners ran quizzes and fun sessions just to focus on that community aspect. Disposable income
Although many were struggling with loss of income there was also the flip-side with many fitness customers on furlough. This meant more disposable income and combined with the boredom of confinement a rise in impulse purchases.
Blended online and in-person
As studios started to re-open, new and exciting business models emerged. The main one being a blended model where online classes now filled an important role in the consistency of training. Now there were options for when a class had to be missed due to other commitments.
A second wave of understanding
Most gyms re-opened in the early summer of 2020. With smaller classes and continued online classes, it felt like a short term break from what was coming next.
Gyms and studios emerged as one of the safest environments
A UK study found that in 300,000 cases there were only 72 confirmed cases of the virus in gyms. That was incredibly low and testament to the safety measures that fitness business owners had put into place.
Customers desperate to get back to fitness
A study run by TeamUp with one of their Pilates customers showed that 50% of customers were desperate or willing to get back to in-person classes. This was tempered by the other half of customers wanting or being willing to continue with online classes in some form.
Misplaced fears
As the second wave gained pace, the UK, like many other countries, implemented a tiered system for determining how businesses should respond. They included gyms closing which provoked a furious backlash.
One owner in Liverpool refused to close his doors, and was fined by the police multiple times. The industry rallied behind his story and others, and the overwhelming sentiment led to the changing of the rules around gyms, meaning they only had to close in the most extreme of cases.
The evidence supported this approach and it was another great example of the industry being able to effect change.
The future holds different risks and opportunities for different sectors. The format and size of classes is a key part of any response.
What does the future look like?
For each type of fitness business, the future looks different. Class size, membership models, facility specifications and the demographics of their members are big factors.
Class size
Class size is a big factor in the success of in-person or online classes. If a business is not profitable with small classes they might be unable to run them, or if they cannot help clients in a personal way, then they will face competition from pre-recorded sessions.
Membership models
Memberships that are too inflexible risk cancellation if circumstances change. The same for offerings that are dependant on a particular set of equipment that can’t be replicated at home. However, some fitness offerings like pole fitness did not struggle to replicate their programs to keep customers motivated and happy.
Facility types
Entrance size and physical safety of common areas are factors. Also, the shape and overall floor space will likely dictate class size for a long time to come.
Personal training is less affected but the number of trainers on the floor and the extra time spent cleaning will impact profits.
Member demographics
It goes without saying that the older the customer group, certainly for the first wave, the more impacted a business will be. An outstanding example of a response to this is the Pilates industry which, despite unfavourable demographics, found that their help extended easily through screens.
What does the future look like for…?
Depending on the type of business, there is also a very different outlook and set of opportunities. Box box gyms
Without a doubt, big box gyms are the most at risk. Despite having the space for larger classes and occupancy, their financial model is not based on the members actually at the gym. With huge costs including rent, equipment and cleaning, they are under a lot of threat.
There is also the perception of less safety in a bigger environment.
With customers at home they are also not close to the big gym they use near their office.
In an industry whose profits are based on membership fees for inactive clients and who naturally have a less active community, the future is looking challenging. Of course there are outstanding businesses in this sector who will find a way to thrive.
Boutique and small studios
In-person might vary in availability but the good news for the smaller class sector is that they have shown themselves to be able to adapt quickly and customers being willing to accept change.
Coached online – small classes via platforms like TeamUp for Zoom. This is the perfect blend of online and small group coaching. The industry has adapted and the quality of classes and delivery is very high.
It’s clear that customers place their fitness relationship at the centre of their world and independent fitness businesses who do the same will survive and thrive.
However, it is the time to adapt and blend models if these businesses rely on large indoor classes, specialist equipment, or coach heavy training that cannot be replicated online. With a bit of imagination and innovation, this shouldn’t present an impassable obstacle.
Home gyms and pre-recorded online classes
Home gyms and pre-recorded online classes are likely to boom for the foreseeable future. New programs launching and equipment sales are at breaking point. The only thing stopping this sector is the availability of global shipments. Even movie stars have jumped on this wave. However, competition is high, and the problem remains that when you pay for a coach you pay for accountability and results. Online interest tapers off quickly and results can be disappointing. However, this is not true of coached online…
The conclusion
Whatever the immediate future holds, the fitness industry has shown itself to be capable of incredible feats of change and adaptation. Fitness customers wanting results aren’t going anywhere, and even with a more diverse offering of routes to their goals available, are never going to stop needing accountability and support. The industry is ready for whatever comes next.
About the Author: The article has been written by Tim Green. Tim is the Head of Marketing and Partnerships at TeamUp.
