"Fitness is becoming a must-have for life."

After the pandemic, Russians' interest in fitness has grown. If before 2020, according to experts' estimates, only 2.5% of the country's population were regularly engaged in it, now the figure has reached 4.7%. More than 1 thousand fitness clubs and studios have opened in the country in two years, and according to forecasts, their number will only grow. Olga Kiseleva, President of the Association of Fitness Industry Operators, told Izvestia about the state of the industry, trends and changes in it.

"The industry will develop."

- What is the state of the fitness industry in Russia today? Have there become more fitness clubs - and why? What trends are you observing?

- Starting from the end of 2021, post-Covida, the fitness industry has started to grow, and at a fairly high rate - one that was not seen before 2019. On average, the growth in gross revenue in 2022 vs. 2021 is 11%, and 18% in 2023 vs. 2022. The forecast for growth in 2024 relative to 2023 is about 22%. In absolute figures, this is about 213 billion rubles for 2023, the forecast for 2024 is about 260 billion rubles.

At the same time, the business model of the industry itself has changed, and it happened in 2021-2022. The pandemic period was characterized by a lack of opportunity for long-term planning in both business and life. This led to the standard upfront payment model, where a person paid for fitness six months to a year in advance, becoming less popular. As a result, the upfront model began to be gradually replaced by a recurring model, i.e. "subscription fitness" - a fixed debit of a certain amount (usually small) from the client's account. In 2021-2023, the volume of funds paid for fitness under this model amounted to more than 8% in the country as a whole, and 15-16% in Moscow. Despite the seemingly small numbers, the dynamics are very high.

Other trends we are seeing are the collaboration of medicine and fitness (it is still in its infancy, but it is already developing) and the rapid development of studio fitness. We are talking about small mono-projects on small spaces of 100 to 500 square meters. meters. Out of 100% of the studios opening, 80% are fitness studios with a low investment entry threshold (from 1.5 to 10 million rubles). One of the aspects contributing to the active development of this market is the large number of small areas suitable for mini-studios.

-What is the increased interest in fitness related to?

- With consumer behavior. Fitness is becoming an almost obligatory condition of life, a "hygienic minimum" - just like brushing your teeth, taking a shower and putting on fresh underwear. To a greater extent, this is more evident in big cities. But, as a rule, everything that is popular and fashionable in the capital and million-strong cities quickly reaches small towns as well.

The pandemic has brought us to the realization that long periods of physical inactivity have a detrimental effect on physical and mental health. In this sense, 2020 was a kind of trigger: while only 2.5-3% of the population was regularly engaged in fitness before the pandemic, by the end of 2024 this figure is already 4.7%.

- How did the pandemic affect the fitness industry, did many clubs close or open afterward?

- To a certain extent, the pandemic has become a marker of business resilience. Prior to 2020, a large number of fitness projects operated on business models that were on the verge of survival and kept afloat not so much by margins and profitability, but by personal brand and owner desire. As a result, in the pandemic, many of them closed.

At the same time, according to Fitness Data, 580 fitness facilities (studios with an area of up to 500 square meters and clubs with an area of more than 500 square meters) opened in Russia in 2023 alone. From January to November 2024 inclusive - 420 facilities. The dynamics has slowed down, but the fitness industry will definitely develop at a great pace in the near future.

If we talk about whether it is worthwhile to enter this industry from scratch now, it is definitely worth it and now. For comparison, in Europe about 15-20% of all companies are commercial fitness, in the USA in large cities the figure reaches 35-40%. The indicator in Russia, which I mentioned above - 4.7% - proves that we have room to grow. At least for the next 10 years, the fitness industry will definitely grow.

"The most painful question for the industry"

-To what extent is the fitness industry regulated in terms of legislation and consumer rights? Or, being a commercial segment, can it dictate its own terms for clients?

- This is the most painful question for the fitness industry. On the one hand, from the point of view of business regulation, the government is paying more and more attention to the industry and adopting various federal laws and regulations to systematize and regulate the business activities of the fitness industry.

On the other hand, as in all B2C industries that deal directly with consumers, the "Consumer Protection Law" in Russia takes precedence. As a consequence, in most situations, court rulings will be made in defense of consumers.

Just the other day in one of the clubs of a popular chain there was a controversial situation when the coach considered that one client was training another. The reaction of the club is absolutely understandable. Internal rules, fixed in the contract, this is forbidden. At the same time we see a flurry of negative comments about the company. Although few people know that in the event of an injury sustained at the club during training, the CEO is criminally liable. This story is very important to the industry because it illustrates the relationship between consumers and the fitness industry and what controversial situations can lead to.

The fitness industry has a lot of potential to scale and a lot of time and resources are spent on resolving situations like this. In my opinion, if all participants in the fitness industry consolidated and were able to formulate some common rules at key points of interaction with customers, it would be easier for them to communicate with consumers.

A similar situation once existed in the airline industry. Previously, no law regulated how the crew could and should deal with disruptive passengers on board. Until a law was passed that allowed such troublemakers to be legally removed from a flight, airlines had to suffer under the "Consumer Protection Act." The fitness industry should have the same rule, as it is a safety issue.

Going back to the story of when one girl was working out, all the haters somehow forgot (or don't know) that it's always the person's own fault for not following safety rules. And once something happens, he is not ready to take responsibility for his actions or those of his coaching friend. More often than not, the incident is followed by a lawsuit in court against the fitness club.

"You can pay from 10,000 to 1.5 million rubles a year for training"

- How accessible are fitness classes to different segments of the population in Russia?

- In Russia, the fitness industry as a separate segment of the economy has existed for just under 30 years. Initially it was only available in the premium segment for highly solvent people. Today, price segmentation allows any category of citizens to join fitness. You can pay from 10 thousand rubles to 1.5 million rubles a year for fitness training. You can even practice on your own using video instructions on the Internet for free. Another question is what quality these trainings will be, but nevertheless. Fitness is in fashion and available to everyone.

The trend toward recurring payments, which I mentioned above, allows you to allocate your monthly family budget and fit fitness into it without sacrificing other categories of spending. The subscription-based fitness model significantly lowers the threshold of entry for consumers into fitness.

- What new formats of classes and services are emerging in the fitness industry and how are they perceived by consumers?

- In addition to the recurring payment model, which is innovative for Russia, online training is developing today. Of course, this is a stick of two ends. In the covid era, they helped people overcome the difficulties of forced self-isolation. The industry had a feeling that a paradigm shift in the market was coming and that after emerging from the pandemic, at least 50% of consumers would engage in online fitness. But these predictions did not come true - today online fitness is preferred by no more than 2% of people.

Nevertheless, I believe that the development of the online sector is a matter of the near future. And we, as representatives of the classic offline fitness business, need to monitor the development of online fitness very carefully.

The difficulty of the online fitness industry is that it is much more "gray" than offline. Neither Rosstat nor any analytical agencies can measure and estimate the amount of gross revenue in this market. I think its size is large, but it is not clear how to digitize it.

In any case, online fitness is definitely one of the growth areas of the industry. If a person goes on a business trip or vacation and doesn't want to miss a workout, online classes will definitely solve that problem. However, if we talk about online fitness as the only option, then in my opinion, the expectations from it are too high. The camera will not convey the accuracy of the exercises, the trainer cannot fully assess your condition while performing the tasks. That's why I think online fitness needs some more advanced technology (like sensors) to help the customer get a full workout.

"Supporting the coaching staff is the future of the industry"

- What problems and challenges do fitness clubs and centers in Russia face today? How are they coping?

- The key factors that affect the fitness industry are roughly the same as in other areas. First of all, it is the Central Bank rate, on which investments depend. Basically, the fitness industry develops on credit money, which today has significantly increased in price. As a consequence, investment and operating costs - the cost of providing fitness services - are increasing, so the price of fitness for the end consumer is growing.

Consumer activity and people's ability to pay are equally important. Despite the fact that it is important and fashionable to engage in fitness, only 4.7% of the population engages in it regularly and constantly. If we consider priorities and the ability to satisfy them, the majority of Russians prioritize food, clothing, transportation, and goods for children first, and only then health and fitness, if there is money left for it.

This is why the fitness industry is approaching this issue very cautiously, and price growth in the industry averaged about 7% in 2022 to 2021, and 11% in 2023 relative to 2022. Price growth in 2024 is projected to be around 11% by 2023. This is significantly lower than the average price growth in any other industry.

Another challenge for the fitness industry is the sanctions that have cut Russia off from the international market. This is about the availability of equipment. Previously, 80% of all fitness equipment was purchased in the USA and Europe, today the same amount is imported from China and South Korea. This is neither bad nor good, but it is different. Companies that continue to buy on the Western market have faced a significant increase in the cost of both the equipment itself and logistics. The same was true for the standardized programs that the Russian industry was working with. After Les Mills left, no one has yet taken their place to the same extent.

- What role do government programs and initiatives play in supporting and developing the fitness industry?

- The state legitimized the fitness industry in the "Law on Physical Culture and Sports" only in 2019. After that, a large number of different laws and acts concerning the fitness industry were adopted. On the one hand, business cannot exist in isolation from the state. On the other hand, the state is not always able to correctly form a regulatory framework that would not harm certain business processes.

Nevertheless, the fitness industry receives certain support from the state. First, it is popularization of the idea of a healthy lifestyle at all levels - from federal to municipal. This, albeit indirectly, still influences the fact that people come to fitness clubs.

Secondly, it is a tax deduction - 13% of paid fitness services, which can be refunded. Our Association has been dealing with this issue for a very long time and was able to prove the necessity of this measure both to the Ministry of Sport and the Federation Council.