COVID Vaccine & the Impact on the Fitness Industry
On another note the announcement and pending availability early next year of a COVID vaccine, which was highly publicized I believe back on the ninth of this past week, has had a telling impact on the stock market if you didn't see it. Peloton stock dropped by 14.5%, and Planet [Fitness] stock improved by 10.5%. As the saying goes, "Follow the money." Let's hope that's the case as investors look favorably on a strong return on brick-and-mortar facilities as they look out into the future and the economic impact.
IHRSA Announces Global Health & Fitness Alliance
On an international level, this past week IHRSA is thrilled to announce the inaugural meeting of the Global Health & Fitness Alliance, including over 40 representatives from around the world. This group includes progressive thought leaders, and is collaborating to build a united alliance of health and fitness community partners to serve countries, again, worldwide. And we're really excited about that.
Global Wellness Institute Releases “Defining the Mental Wellness Economy”
The Global Wellness Institute actually released its major research report for 2020 this past week, titled "Defining the Mental Wellness Economy." In that report, you'll find the global wellness economy is worth $128.8 billion and has become sort of a new industry darling, a new industry opportunity, that's growing exponentially.
Fitness Industry Closures Continue
On the research front, based on data for major processing payment firms, 15% of fitness clubs and studios have already closed permanently as of September 30. Additional closures are imminent by the end of the year as club operators grapple with the disproportionate impact of the pandemic. Thanks to the payment processors, Rick Caro and the IHRSA team, for pulling this data together, which also included the fact that more than $15 billion in revenue has already been lost, along with, unfortunately, economic activity than brick-and-mortar facilities contribute to their local communities.
ClubIntel Study Projects Club Revenue for 2020
According to a recent ClubIntel study, U.S. fitness centers still in business are projecting a 37% decline in revenue this year relative to 2019. Of course this information, although current, predates this most recent restrictions and closures that we're undergoing right now.
REX Roundtable Insider Information: Membership Freezes
The REX Roundtable Insider Information this week is about the percentage of freezes, same month, year-over-year, and the average they're reporting is 19.5%. But just as a reminder for all of you, the statistics that we're sharing, especially when their averages across the United States, vary widely, depending on your geography. Some clubs have been open for months, and others, such as in California, have not been opened at all. So your actual location in the country dictates results to a really large extent. So just keep that in mind as you're comparing the numbers we're sharing.
McKinsey Report Finds Intention to Exercise Post Shutdown Has Decreased
McKinsey recently reported that in the U.S., the intention to engage in fitness activity post shutdown is 65%. That trails pretty closely to what we're finding in the industry, perhaps a little higher in the industry. They're also reporting that the use of studios and boutiques decreased to 17% versus 20% pre locked down.
So I just want to end today's session confirming what we all know, which is that these are just so challenging and frustrating times that we're in, it's just really ridiculous about how decisions are being made about whether to close or open facilities, about some of the restriction plans that are in place. Again, we just really are trying to reach out to as many elected officials as we can, present them with the facts, and encourage them to follow the science that shows undeniably that health clubs really just are not the problem. What we can do is choose to be resilient, try to maintain a positive attitude, and we hope that we can do that along with you.
Thanks for coming this week. See you next week. And thank you to Precor for sponsoring this week's Take 5.