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Profitable fitness at fingertips

By Zheng Yiran | China Daily | Updated: 2019-04-29 08:04
Fitness seekers work out at an app-based small gym located on the ground floor of a skyscraper in Chengdu, Sichuan province. An Yuan / China News Service

As consumption upgrades, app-backed small gyms spawn new business model

A combination of health awareness, lifestyle-related consumption upgrade, innovative use of digital technologies, and high-quality manufacturing is spurring a boom in China's fitness industry.

By the end of 2018, the industry boasted more than 53,000 facilities - gyms big and small, dance-based exercise floors, yoga studios and the like - that shaped forecasts of a 70 billion yuan ($10.4 billion) business by 2020.

Although the 9-percent rise in the number of facilities last year was lower than the 13-percent surge in 2017, what is making market insiders jump up in joy are estimates of 20-percent annual sales growth.

Driven by such bullish sentiment, Xia Jinglong co-founded Supermonkey, a Shenzhen-headquartered gym that has a digital footprint.

He recently told technology website Geekpark that the online dimension will become an industry standard in the future.

Technology, he said, has obviated the need for front-desk people and sales people, and digitalized all the transactions and browsing activities. Mining app-user data and using proprietary algorithms, precious feedback can be funneled to fitness instructors, and classes arranged automatically for gym members.

Internet-based gyms usually take smaller floor area. This makes it easier to change locations. Like convenience stores, they are scattered across cities, making them more accessible for the fitness crowd than traditional gyms, which are like supermarkets. The two types of gyms co-exist in the market, and complement each other. This will be a future trend, Xia said.

Wang Ke, a 22-year-old college student in Beijing, will probably agree. She loves to work out at LeFit, a multi-discipline fitness chain with about 500 relatively smaller facilities across China. The LeFit app enables its users to book workout sessions anywhere anytime as per their convenience and preference.

On a late Friday evening earlier this month, Wang headed out for a yoga class she had booked online.

"Before going to a gym, I browse LeFit's website or app. It offers various courses - Pilates, boxing, trampoline, indoor cycle, and dancing.

"Each branch offers different classes at specific times. I pick my preferred class at a suitable time, and then go to that branch for the class. The gyms are open 24/7, and the membership card is valid countrywide."

LeFit's monthly membership card retails for 129 yuan. Membership for a longer tenure costs less. This imaginative mix of tech, convenience and multiple pricing options has made LeFit immensely popular among urban fitness fanatics. So much so, at some branches, LeFit classes now need to be reserved much in advance.

By the end of 2020, gyms in China are projected to have more than 21 million paid users, up from a total membership of 16 million at the end of 2017. Going forward, their annual growth rate is seen around 10 percent, up from 7 percent of the recent past.

A recent report from Analysys, a Beijing-based market research consultancy, noted that China's gyms with a digital footprint will see rapid growth by 2020.

"With the public's awareness of high-quality healthcare options growing and incomes rising, both the government and the capital market are offering support to the fitness sector. China's gym market maintains huge room for growth in the coming years," said Wan Yi, an industry expert at Analysys.

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