The Resilience of Gyms Amid Economic Challenges
As consumers navigate the ongoing cost-of-living crisis, many are reevaluating their spending habits and making cutbacks. According to a recent survey, 77% of respondents reported an increase in regular expenses, primarily driven by inflation. Consequently, 38% plan to reduce or eliminate social activities this year. Yet, gyms are defying the trend, outperforming other leisure and food-and-beverage (F&B) sectors. Despite 75% of respondents feeling neutral or worse about their personal finances, an impressive 73% intend to maintain or increase their gym attendance.
Why Gyms Are Essential
The survey revealed a broad consensus: no age group showed a notable willingness to cut back on gym visits. This underscores the perception of gyms as a vital part of modern wellness and social routines, particularly in an era where remote work dominates.
While activities like dining out, attending live events, or participating in competitive social activities are being reduced, gym visits remain a priority. With 87% of exercisers working out at least once a week, health and fitness are seen as indispensable components of a balanced lifestyle.
Spending Priorities
Consumers are more willing to sustain their monthly gym memberships than spend on one-off indulgences, which are perceived as less essential or too costly. With 46% of respondents reporting stagnant or declining incomes, gyms must strike a balance between delivering value and keeping membership fees reasonable. The survey highlights that memberships drive consistent engagement; however, if members feel pricing doesn’t align with value, cancellations could hurt operators’ revenues.
Generational Insights
The importance of health and fitness spans generations:
- Gen Z (16-24 years old): This group plans to increase gym visits, emphasizing the social and wellness benefits gyms provide.
- 55+ years old: The least likely to reduce or stop gym attendance, showcasing the enduring value of fitness for older adults.
To thrive, gym operators must appeal to diverse demographics with flexible memberships and tailored offerings. Hybrid workers, in particular, present an opportunity for gyms to innovate with adaptable options.
Luxury Gyms vs. Budget Models
High-end gyms are showing strong recovery, thanks to amenities like spas, racquet sports, and outdoor pools that cater to families and urban professionals alike. Annual contract renewals in these facilities highlight their appeal despite the rise of budget gyms with flexible monthly subscriptions.
However, boutique urban workout studios and mid-tier gyms face challenges, as economic pressures affect their ability to attract and retain members. Flexibility and value-driven programming will be essential for these segments to stay competitive.
Lessons from the Past
During the Global Financial Crisis (GFC), gym memberships dropped as consumers cut discretionary spending. In contrast, today’s economic challenges have not had the same effect. Gym membership numbers are on par with pre-COVID levels (16% of UK adults held a membership in 2023, compared to 18% in 2019, according to Mintel).
The pandemic also saw a temporary surge in at-home workouts and fitness apps, but this trend faded once restrictions lifted. By March 2023, the gym market recorded an 11.5% increase in value over the prior year—the largest annual growth on record—and a 3.9% rise in membership numbers.
The Future of Gyms
Rising energy and staffing costs have led to a slight decline in the total number of gyms and health clubs in the UK (-0.9% in 2023). Yet, the fitness industry remains resilient. Whether opting for budget gyms or boutique luxury experiences, consumers continue to prioritize health, community, and connection.
This unwavering focus on wellness solidifies gyms as leaders in the leisure sector, poised to evolve and grow despite broader economic pressures.
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