Fitness Industry Prospects: How Much Can Companies in This Sector Gain?

Since the late 1960s, data has clearly indicated an increasing problem with overweight individuals among both children and adults. Currently, the percentage of obese adults has exceeded 40%. Projections suggest that by 2030, half of all Americans will have a BMI over 30.

As a result, the demand for qualified fitness instructors is expected to rise sharply. The same applies to the growing demand for gym memberships and fitness classes. Producers of sports equipment are also likely to see higher profits. Many companies stand to benefit from these current trends, and investors may also share in these gains.

Dynamic Market Growth

Young people are significantly more likely to take care of their physique. Data from the United States shows that Millennials (those born between 1979 and 1993) make up as much as 45% of all gym and fitness club clients. Generation Z (born between 1994 and 2022) is also a powerful force, accounting for 35% of all gym and fitness club members. Generation Z trails Millennials only because many in this group are not yet of legal age. Therefore, the trends clearly indicate that the trend toward a healthy lifestyle is gaining momentum. Consequently, the potential customer base is expected to grow over time.

The expanding target group utilizing services in the broadly understood fitness industry will, of course, boost overall growth dynamics. Forecasts suggest that the entire market will grow at a rate close to 7% annually until 2030. However, individual sub-sectors are likely to surpass this rate with ease. The fastest-growing segment in the fitness industry is expected to be the online/digital fitness sector. Revenues generated from delivering live-streamed, on-demand, and pre-recorded fitness content are expected to grow by 33.1% each year, leading to a total increase of 640.1% from 2021 to 2028.

Digital Fitness

Digital fitness primarily includes online training services. This category also encompasses training packages in VOD format, offering non-personalized workouts aimed at the broadest possible audience. These are significantly cheaper than private online lessons with a personal trainer.

Secondly, fitness apps are also projected to perform well, with a robust CAGR of 23.5% until 2028. These are smartphone applications designed to help users work out more efficiently, whether at home or at the gym. Many apps are not directly related to physical exercise; for instance, many are designed to help users stick to a chosen diet. Nevertheless, all of this is tied to a healthy lifestyle.

AI Technology in the Fitness Industry

An increasing number of people are aware of the significant potential of artificial intelligence (AI). We have also discussed AI's possibilities in our articles "Artificial Intelligence: The Investment Hit of the Decade!" and "Artificial Intelligence Ousts Graphic Designers." The fitness industry is also increasingly utilizing AI technology. Here are some examples of how AI is being used in the fitness sector:

• AI-powered Workout Apps: Apps like Fitbod, Freeletics, or JEFIT use AI to create personalized workout plans based on user data such as age, gender, fitness level, and training goals.

• AI-powered Wearables: Devices like smartwatches and fitness trackers use AI to analyze biometric data such as heart rate, calories burned, sleep quality, etc. This data is then used to tailor workout plans and monitor progress.

• AI Virtual Trainers: Some companies use AI to create virtual trainers that can lead live workouts or VOD sessions. They use image recognition technology to correct form and exercise technique in real time.

• AI Chatbots and Voice Assistants: Fitness chatbots and voice assistants are programmed to provide advice on exercise, diet, hydration, etc. They can also answer questions and provide information on healthy living.

• AI Fitness Club Management Systems: AI can be used to manage fitness clubs, optimizing class schedules, predicting and managing customer flow, and even automating membership processes. AI can also offer discounts to customers who underutilize their memberships, which can still be profitable for gyms by retaining low-cost customers.

• AI in Fitness Equipment: Some companies manufacturing exercise equipment, such as stationary bikes or treadmills, integrate AI to adjust workouts to individual user needs. For example, equipment can automatically adjust resistance or speed based on the user's heart rate.

• AI-driven Diet Personalization: There are apps and platforms that use AI to create personalized diet plans by analyzing user data such as age, weight, and physical activity levels to deliver a tailored diet plan.

Interesting Fitness Companies

To gain exposure to the fitness industry, one can, for example, purchase shares of specific companies. This approach can generate the highest returns. Active investing is best suited for experienced investors. An example of a company in the industry that is performing well in the market is Planet Fitness.

Planet Fitness is an American fitness club chain founded in 1992, which has been rapidly expanding the number of its gyms. The company gained popularity through its "Low Cost, High Value" strategy, offering affordable membership prices. Currently, for example, access to the gym can be purchased for just $10 per month. Their facilities are open 24 hours a day, 7 days a week.

One of the key elements of Planet Fitness's success is its business model. The company focuses on accessibility and a low entry threshold for its customers. It targets beginners and less advanced individuals, ideally those who will train infrequently, which significantly reduces business costs. Planet Fitness started as a small sports club in Dover, New Hampshire. Since then, the company has experienced rapid growth. By the end of 2022, the company had approximately 2,400 clubs worldwide, most of which are located in the United States. The long-term goal of the management is to reach 4,000 locations in the United States alone.

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