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Practical guide to the smart fitness and sports industry in China

As the Chinese population becomes more affluent, they are also becoming more health conscious. Due to the COVID-19 pandemic, consumers stopped going to traditional gyms and embraced products offered by the smart fitness and sports industry that allowed them to work out at home. The industry, which includes fitness apps, smart fitness wearables, and smart exercise equipment, will amount to US$5.2 billion in 2023.

By 2025, the industry is projected to reach US$ 12.3 billion. The COVID-19 pandemic changed a lot about the way consumers live, including how they work out. Now more than ever, customers are using smart interactive fitness equipment that allows them to exercise at home.

The large and active Chinese millennial population has embraced the trend for a healthy lifestyle, either by subscribing to gym memberships and fitness classes or buying their own smart fitness equipment. The sports and fitness market in China has seen exponential growth, from about 500 gyms in 2001 to more than 100,000 fitness studios in 2022.

China’s fitness boom is also encouraged by the local government, which announced a five-year plan that will invest 1.5 trillion yuan ($225 billion) to improve its citizen’s fitness level as well as fight obesity. The plan focuses mainly on teenagers, who will likely carry on these fitness habits as they age.

According to China Daily, the government is planning to increase the per capita sports area to 2.6 square meters by 2025.

The smart fitness and sports industry has been growing over the past few years in China, especially among the Chinese middle class interested in maintaining a healthy and balanced lifestyle.

The future of the digital fitness market in China looks promising with opportunities in smart wearable fitness devices and smart wearable sports devices. The major drivers for the growth of this market are increasing awareness of fitness, and rising demand of user-friendly and self-monitoring devices.

Emerging trends, which have a direct impact on the dynamics of the digital fitness industry, include integration and cross-compatibility of personal health data and introduction of cross over products.

Smart wearable fitness and sports devices are the most popular products in the market. Experts forecast that the smartwatch segment is expected to witness significant growth due to their versatile features as a wristband.

Within the digital fitness market, smartwatch is expected to remain the largest segment by product type. Multi functionality features, growing health awareness, and rising in disposable income are the major driving factors that spur growth for this segment.

The global wearable fitness tracker market size was valued at US$ 45 billion in 2021. It is projected to reach US$ 192 billion by 2030, growing at a CAGR of 17.5% during the forecast period (2022–2030). North America holds the highest market share and is estimated to grow at a CAGR of 15.5% during the forecast period.

Depending on the user's requirements, a wearable fitness tracker may follow several activities. These trackers may include goal-setting, sleep tracking, activity tracking, calorie tracking, heart monitoring, and step counting.

Fitness apps have also experienced increased popularity fuelled by social distancing due to the COVID-19 pandemic. More than 100 million mobile users have at least one fitness app on their phones, and new apps and platforms are popping up every day.

Besides the health concerns caused by the pandemic, Chinese citizens are facing a serious obesity problem, especially with children, with one in three kids having problems with weight.

The emergence of fitness apps has played a major role in the increased popularity of exercising across the country. This phenomenon has led to a rise in health awareness as well as an interest in fitness as a lifestyle, largely embraced by Chinese fitness influencers on social media.

Thanks to the pandemic and the need to exercise at home with mobile apps and online platforms, people of all ages and from different cities and backgrounds started showing interest in the health and fitness industry, trying to stay fit and change their eating habits.

Besides young people, the Chinese government is encouraging the older population to become more active. Faced with an ageing society, authorities want people of all ages to train, by building new facilities, offering sports programs, and planning to invest more than 5 trillion RMB in the sports and fitness industry by 2025.

Two of the most popular activities in China are yoga and dance sessions. The yoga industry is worth over US$88 billion worldwide and is expected to reach US$215 billion by 2025. As for China, the revenue reached almost 50 billion yuan (US$ 7.5 billion) in 2020.

Since March 2020, there has been an increased interest in yoga in China. People had to look for ways to stay active during the prolonged lockdowns and a healthy way to deal with the situation. Those who picked up doing yoga during the pandemic will most likely continue doing it, even after restrictions have been lifted.

In China, yoga is considered a way to relieve stress, cultivate beauty and keep fit. This is the reason why many fitness centers have different types of yoga and dance classes. This means that the demand and popularity of such activities are relatively high. Even though there are cardio and bodybuilding sessions available, most users prefer yoga and dance.

Since the beginning of the pandemic, the online fitness market experienced a substantial increase, with online yoga being the most popular. Lots of videos of people, especially KOL who displayed fitness exercises, promoted sportswear and fitness equipment have gone viral on Chinese social platforms such as Douyin/TikTok and Xiaohongshu.

According to a report from the short-video platform Douyin, the number of fitness videos on the platform in 2022 rose by 134 percent year-on-year, while the number of content creators for these videos rose by 39 percent. Compared with the previous year, there was a 208 percent rise in the number of followers of these online fitness trainers.

Revenue from live fitness broadcasts on Douyin rose by 141 percent year-on-year, and the growing passion for exercising at home resulted in fast sales growth for some equipment.

According to the 2022 Spring-Summer Sports and Fitness Consumption Trend Report published by the Jingdong Institute of Consumer and Industrial Development, sales of yoga and dance products have risen rapidly. Sales of yoga stretchers grew by 868 percent, yoga shoes by 816 percent, and yoga bags by 104 percent.

The 2022 China Online Fitness Industry Development Report released by the Intelligence Research Group shows that the market scale of the nation's online fitness sector saw 36.2 percent growth in 2020, and its market value reached 369.7 billion yuan.

Traditional gyms were forced to close all over the world because of the pandemic, China included. The trend for home smart exercise equipment drastically increased during the lockdown periods, and this trend is likely to continue.

Sports apps such as Keep, Codoon, and Mi Fit are popular among Chinese consumers. App users can easily get training tips, find online fitness courses, and personal training studios, get connected with other fitness enthusiasts and professional trainers via their smartphones. This business model also helps companies expand customer relationships on a different level than before.

At the same time, the pandemic accelerated the digitization of the fitness industry. As gym operators create online content and classes to maintain and/or expand their customer base, consumers are becoming more and more familiar with home fitness and online fitness.

Some companies leading the way include Lululemon and VAHA X, who have created mirrors that double as interactive training screens, and JAXJOX, a buildable home fitness equipment provider based around a touchscreen TV. Fiture is another active brand of fitness mirrors in China, while fitness brands such as Codoon (fitness app) and Lefit (gym) in China have also released smart training mirrors.

When urban Chinese consumers are asked how they plan to shift their leisure priorities after COVID-19, sports and fitness activities are among the top three, both in the in-home and out-of-home scenarios.

Mintel monthly survey to track consumers’ fitness behaviours indicates that about 20 percent of the consumers claim they have the habit of working out at home. Those who go to in-person gyms are a smaller group, but the number has been growing very quickly in the past year, almost doubling the size.

Fitness brands have a fresh set of business opportunities in the market, especially with the expanding home exercise population, and their growing desire for elevated exercise experiences. Many new brands in the market have appeared over the past few years, continuously attracting new investment.

Besides fitness apps and smart home fitness equipment, there are other white spaces waiting for brands to tap into. Some home design brands are developing creative furniture collections which can be turned into training equipment; and some beauty brands are launching fragrances inspired by fitness activities (like yoga). There are also laundry brands developing special formulas to take care of the smells generated from sweat in fitness clothes.

Chinese consumers are embracing active lifestyles, they believe doing fitness can help improve self-confidence, and their fitness habits and spending preferences introduce opportunities in various business areas. Fitness and sports nutrition are areas with great potential for product innovations and upgrades.

Internet technology has brought positive changes to China’s fitness industry amid the country’s efforts to advance its national fitness program, energizing new business models and allowing people to socialize through exercise.

New-style fitness gyms supported by digital technology have made workouts more flexible. Lefit, a 24-hour self-service gym chain based in Hangzhou, capital of Zhejiang province, is emblematic of the new type of gyms that young users have switched to. People can enter a Lefit gym by scanning a QR code with the brand’s app and then have access to its fitness facilities.

The brand has an intelligent management system that can precisely match its users, gyms, and fitness instructors, which guarantees higher operational efficiency and lower costs than conventional gyms, according to its founder Han Wei, adding that the brand offers a pay-per-use model.

The brand has so far opened 754 gyms across the country and has attracted more than 6 million users, Han added.

Technology is also influencing the sportswear industry. With the help of big data and kinesiology, underwear brand Aimer is striving to develop new materials with less friction and higher air permeability for its yoga and running suits, according to Liu Huizhi, vice president of the company in charge of the sportswear line.

Smart spin bikes that cater to the diverse needs of consumers and smart wearable devices such as sports bracelets that measure calorie expenditure during exercises are popular products in the market. Furthermore, smart devices launched by Keep, a popular fitness app in China, have reached 1.56 million users.

In the past year, over 23 million users uploaded short clips related to exercise on Kuaishou, and a daily average of more than 20 million users worked out according to live-streaming fitness courses on the platform.

For companies in the health and fitness industry, now it’s a great time to expand their presence and enter the market in China. There are some key steps to take to be able to sell fitness apps, equipment, or clothing in the highly competitive Chinese landscape.