This is the time of year when Americans would ordinarily be flocking to their local gyms, and replacing the carbs in their kitchens with kale. As 2022 kicks off, though, it seems that one more casualty of the coronavirus pandemic is the New Year’s fitness resolution. For the diet-and-workout industry, omicron couldn’t have come at a worse time. Anxiety about mingling with strangers — especially while exercising — is high, and morale is flagging as Covid-19 cases soar, leaving the nation with a wearying sense of deja vu.
“I’m kind of terrified to go back into the gym right now because of Covid,” said Stacey Wacknov, a health care communications consultant who lives in Phoenix. “Our rates of vaccinations are horrible,” she said.
Wacknov has plenty of company in her concerns: A study published in December 2020 by fitness research firm ClubIntel found that 57 percent of gym-goers who said they hadn’t resumed their pre-pandemic workout routines were forgoing fitness centers because they didn’t believe Covid-19 was sufficiently under control.
More recent metrics indicate that omicron could be triggering this effect once again. According to Placer.ai, an analytics firm that tracks retail foot traffic, fitness centers saw a roughly 12 percent drop in the week of Dec. 27, 2021 compared to the same week in 2020.
“There’s more concern again about being in a room where people are sweating,” said Ken Leon, director of equity research at research firm CFRA. “It makes the opportunity still attractive for home fitness.”
Yet even one-time stars of the “stay at home economy” like Peloton are facing an uphill climb. The company’s stock peaked shortly over a year ago and has been on a bumpy downhill ride since — an indication that investor enthusiasm has hit a rough patch.
“For venture capital money coming into the space, it’s less attractive,” Leon said. “I think, ultimately, home fitness is a subset of broader fitness. But I do think people want to get back to the gyms.”
But for this to happen, people need to feel safe — and motivated. Wacknov said the prospect of New Year’s resolutions in general seems to elicit exhaustion rather than enthusiasm in her social circle. “I really haven’t done resolutions this year. I think a lot of us have tried to sneak quietly into 2022,” she said. “We’re kind of just trying to get by, and sometimes challenges just for the sake of challenges might be too much after the last couple of years.”
Ishia Wilson, a yoga and fitness instructor in New York, said she has noticed more students avoiding studios as the omicron surge has worsened. “I am experiencing students falling back to virtual classes because of the uptick in cases,” she said in an online chat.
Wilson also observed a “despondency” among some of her clientele, adding that she hasn’t been immune from the mental strain, as well. “While I’m very passionate about this line of work, I can admit that my own motivation to train has waned a bit,” she said.
Liz Clark, president and CEO of IHRSA, The Global Health & Fitness Association, said the timing of the January omicron surge was a devastating one-two punch for the industry. “It’s such a critical month, when people tend to rejoin gyms,” she said. “And the industry was already struggling before omicron.”
Traditionally, January has been the fitness center equivalent of the stretch between Black Friday and Christmas Eve for retailers. On the company’s third quarter earnings conference call in November, Planet Fitness CEO Chris Rondeau said that 60 percent of new members tend to sign up in the first quarter, with January signups comprising a “large part” of those numbers.
This bad news is even worse for the 80 percent of the nation’s fitness centers that are small businesses. “Those are the ones that are hit the hardest,” said Mark Williamson, co-founder and principal of ClubIntel. “They simply didn’t have the capital reserves to make it through the pandemic. The big box gyms tend to be the ones surviving the best,” he said.
Many small gyms and studios have already succumbed to Covid-19. In 2019, there were 41,370 health clubs in the U.S., according to IHRSA. By the middle of 2021, that figure had plummeted by 22 percent, and Clark said early data indicates that even more have shut their doors in the ensuing months.
“In some instances, people don’t have their club to go back to,” she said. While some fitness centers pick up new members when other clubs fold, the transition often isn’t quick — and might not happen at all. “When you’re a member of a club, it’s different, it’s a community you tend to rely on. Finding a new place is something people take very seriously,” Clark said.
Dan Faill, a professional speaker and coach living in Los Angeles, is one former gym-goer who hasn’t found a new home for his fitness endeavors. “My favorite gym in the world closed over the course of Covid,” he said. “It took me some time to mourn that loss.”
Faill said the current omicron surge is also dampening his motivation to seek out a new place to work out. “I’m not actively looking,” he said. “Here in L.A. we’ve got another explosion, so I’m holding off for now.”
The weight-loss business is facing similar travails. Mindy Grossman, president and CEO of WW International — the diet-program giant formerly known as Weight Watchers — warned on the company’s quarterly earnings call in November that revenue fell short of expectations. She noted headwinds facing the company’s in-person meetings — a one-time bedrock of the business — and “shifting consumer behaviors around weight loss prioritization.”
Namely, going on a diet just isn’t on as many people’s to-do list these days. “People are saying, this isn’t what I want to do right now. I have been through a lot,” Grossman told investors.
“I was actually thinking 2020 was going to be a good year for them, and that literally ran right into the pandemic wall,” said Douglas Lane, president and director of research at Lane Research.
Lane said WW’s significant investment expanding its slate of digital offerings is likely to pay off. “WW now has a lot less exposure to the in-person meetings than they did two years ago, [which] could put them in a much more favorable position,” he said, but he estimated that the amount of business the company earns from its in-person workshops will continue to slide.
And if omicron prompts elected officials to reinstate capacity restrictions or other preventative measures that curtail business activity, that part of the business could fall even further, he said. “To the extent these restrictions reemerge, the recovery in their workshop business will not be the recovery that they expect.”
Some experts — including Lane — remain bullish on the diet-and-fitness industry overall. They point out that, for all of the disruption the pandemic created, it also put into sharp relief for many Americans the importance of being in good shape. On the Planet Fitness investor call, Rondeau alluded to this, saying that Covid provided a reality check for many people about their overall level of physical fitness.
“I do think there’s some motivation there,” Clark said, adding that people are looking for strategies to prevent or reverse Covid-19 co-morbidities like obesity and Type 2 diabetes.
“There’s been a pivot in a consumer’s mind,” Williamson said. “There’s acknowledgement of how a good workout regimen is actually affecting a positive attitude.”
But with pandemic fatigue sapping America’s collective sense of motivation, it can seem for many like a chicken-or-egg equation: If going to the gym motivates you to exercise regularly, where do you find the motivation to walk through the door in the first place?
“I think because of the last two years, every year seems to get a little worse and I think a lot of folks are like, we’ve kind of given up — let’s see what the year brings before we start adding more challenges on top of it,” Wacknov said. “People just don’t seem to have the emotional stamina.”