- Getty/Michael Buckner
The fitness world is experiencing huge shifts, and it’s making it an incredibly profitable business.
From SoulCycle to CrossFit boxes to the popularity of Tough Mudders, people are spending more money on fitness. SoulCycle even filed for an initial public offering last summer.
All of this comes at a time when people are spending less on clothing.
The only brands that are thriving, unsurprisingly, are activewear brands like Nike, Under Armour, and Lululemon.
Oddly, fitness can be a pretty pricey endeavor – so why are people forking over money to fancy classes?
It might be because it falls under the category that we know millennials love: experiences.
“One of the megatrends is this shift toward spending on experiences rather than things,” Jason Kelly, New York Bureau Chief of Bloomberg and author of “Sweat Equity,” told Business Insider in a phone interview. “I do think that that is a big element … in how millennials especially are directing their disposable income. [There’s] a lot more emphasis placed on what you’re doing rather than what you’re getting.”
Some of the trendiest fitness experiences have to do with community and experiences, Kelly said.
“And I think one of the important elements tied to that is how social fitness has become. Fitness for a long time was a relatively solitary endeavor, whether it was people going for a run or a bike ride or even on their stationary bike in their basement and candidly, even going to the gym and … being one in a line of specially in New York City one in a line of 50 treadmills,” he said. “And now, much more group fitness – in a SoulCycle class or a Flywheel class – you’re much more engaged with the people around you, and there’s a real sense of community.”
- REUTERS/Jessica Rinald
The social aspect is huge. Kelly points to the notion of sharing what you’re doing on Twitter and Facebook, but perhaps more notable is the idea of having a community. It’s true that fostering a community is a way to build a strong – and perhaps cultlike – brand.
“What seems consistent is building – and I say this word with some trepidation – kind of these authentic, community-driven brands seems to be the big lesson here,” he said. That people do react in a lot of ways to something that they feel they want to be a part of, that their friends are a part of, and that’s a brand that really understands them and caters to them, and people like them.”
- Lily Lawrence/Stringer/Getty Images
And, crucially, experiences are what define people, rather than just apparel – which could be another reason why fitness is seeing a huge boost.
“In past times, it was wearing a polo shirt or wearing a certain kind of shoe or … a certain type of clothes sort of helped identify [you] as a part of a tribe, and now it’s something you do,” he said.
All of that means someone would rather be defined by spending their money on SoulCycle classes and riding with the pack versus throwing money down on a J.Crew shirt. And besides, if they document it on Instagram, that experience could live longer than that shirt would have, anyway.