The COVID-19 pandemic has redefined health and fitness for many Australians. Several months of relatively sedentary lifestyles and increased consumption of fast food, takeaway meals and snack foods have encouraged many consumers to incorporate physical activity into their daily routine to get back into shape.
Expanding beyond the physical benefits of exercising, more consumers are anticipated to exercise to improve mental health and maintain emotional wellbeing in the current year. According to the ABS, in March 2021, approximately 20% of Australians experienced a high or very high level of psychological distress, 28.1% of which were people aged 18 to 34 years. Supported by the long-established association between physical activity and mental health, COVID-19 movement restrictions and social distancing measures have contributed to a rising demand for digital fitness, where consumers download fitness apps to their digital devices and virtually participate in exercise sessions.
Weaker gym participation
Trends towards working and studying from home without proper ergonomics have brought on complications associated with poor posture, including stiffness in muscles and joints. These issues have encouraged individuals to improve their flexibility, core body strength and alignment, increasing the uptake of virtual yoga and Pilates classes during the lockdown periods. Outside of resistance bands and yoga mats, basic Pilates and yoga sessions generally do not require the use of equipment, which makes them ideal for at-home workouts.
Membership fees represent the primary source of income for gym and fitness centre operators. With constrained growth in membership numbers and a significant portion of members freezing their subscriptions, revenue in the Gyms and Fitness Centres industry is expected to decline by 8.3% in 2020-21, to total $2.2 billion. A fall in real household discretionary income in the current year is expected to further discourage consumers from allocating money towards non-essential purchases, such as gym memberships.
Increased competition from online and app-based players, such as LES MILLS On Demand, and the rise of fitness influencers on social media platforms are also anticipated to weigh on demand for gym-based exercises. The Pilates and Yoga Studios industry’s revenue is expected to fall by 5.2% in 2020-21, to $567.5 million, partly due to the prevalence of fitness influencers in this segment.
Back on track
Population growth and rising health consciousness are likely to be key drivers of growth in the Gyms and Fitness Centres industry over the next five years. Industry revenue is projected to rise at an annualised 5.9% over the five years through 2025-26. High-intensity or functional-based training will likely become increasingly popular among fitness enthusiasts, boosting demand for premium gyms, such as F45 and CrossFit.
Participation in yoga and Pilates is forecast to rise over the next five years, with revenue in the Pilates and Yoga Studios industry anticipated to grow at an annualised 5.4% over the five years through 2025-26. Some benefits of practising yoga and Pilates include:
- Greater flexibility and mobility
- Improved posture
- Supporting heart health
- Building muscle and core strength
- Helping relieve stress
Greater awareness of the long-term benefits of these mindful practices is anticipated to drive consumer demand over the period.
Increase in the obesity rate will likely prompt the Australian Government to promote fitness, weight loss and preventative health measures, encouraging people to live active lifestyles. In particular, government programs aimed at reducing the risks of chronic illnesses related to obesity, smoking and excessive alcohol consumption are anticipated to boost demand for gyms and fitness centres, particularly among younger individuals as they seek to adopt healthier routines.
IBISWorld reports mentioned in this release:
