The large and active Chinese millennial population has embraced a healthier lifestyle, joining gyms and fitness classes or buying their own fitness equipment. As a result, China’s sports and fitness market has seen exponential growth, from about 500 gyms in 2001 to more than 100,000 fitness studios in 2022.

The Covid-19 pandemic changed much about how consumers live, including how they work out. Now more than ever, customers are using smart interactive fitness equipment to exercise at home. The smart fitness and sports industry, which includes fitness apps, wearables and smart exercise equipment, will amount to US$5.2 billion in 2023.

Some of the major players include Garmin, Life Fitness, Peloton Interactive, Nautilus, Technogym, Xiaomi, BH Fitness, Tonal, NordicTrack, Echelon, Bowflex, Hydrow and SoulCycle.

China’s fitness boom is also being encouraged by the government, which announced a five-year plan to invest RMB 1.5 trillion (£171.1 billion) to improve its citizen’s fitness levels and fight obesity. The plan focuses mainly on teenagers, who will likely carry on these fitness habits as they age.

Smartwatches are the leading product in the smart fitness and sports industry

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 for user-friendly and self-monitoring devices.

Emerging trends include integration and cross-compatibility of personal health data and the 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, smartwatches are expected to remain the largest segment by product type. Multi-functionality, growing health awareness and rising disposable income are the major driving factors spurring growth in this segment.

A wearable fitness tracker may follow several activities depending on the user’s requirements, including goal-setting, sleep tracking, activity tracking, calorie tracking, heart monitoring and step counting.

Fitness apps have also experienced increased popularity during the Covid-19 pandemic. Over 100 million mobile users have at least one fitness app on their phones, and new apps and platforms are popping up daily.

Apps also play an important role in the Chinese government’s push to get the older population more active. Faced with an ageing society, the government wants people of all ages to get active, and they are building new facilities, offering sports programmes, and planning to invest more than RMB 5 trillion in the sports and fitness industry by 2025.

What are the most popular activities in the smart fitness and sports market?

Two of the most popular activities in China are yoga and dance. Since March 2020, there has been an increased interest in yoga in China and revenue in the yoga industry in China reached almost RMB 50 billion (£5.7 billion) in 2020. People had to look for ways to stay active and deal with the stressful atmosphere during prolonged lockdowns. Those who picked up yoga during the pandemic will most likely continue doing it, even now that restrictions have been lifted.

In China, yoga is seen as a way to relieve stress, cultivate an attractive body and keep fit, which is why so many fitness centres offer different types of yoga and dance classes. Even though cardio and bodybuilding sessions are available, most users prefer yoga and dance.

Since the beginning of the pandemic, the online fitness market experienced a substantial increase in users, with online yoga being the most popular. Videos of KOLs doing yoga while promoting sportswear and fitness equipment went viral on Chinese social platforms such as Douyin (aka 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% year-on-year, while the number of content creators for these videos rose by 39%. Compared with the previous year, there was a 208% rise in the number of followers of online fitness trainers. Revenue from live fitness broadcasts on Douyin also rose by 141% year-on-year, with rapid sales growth for many types of exercise 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 pants grew by 868%, yoga shoes by 816%, and yoga bags by 104%.

Fitness apps such as Keep, Codoon, and Mi Fit are popular among Chinese consumers. Users can access training tips, find online fitness courses and connect 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.

Companies leading the way in this field include Lululemon and VAHA, 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 (a fitness app) and Lefit (a chain of gyms) in China have also released smart training mirrors.

Which other areas of the industry can brands tap into?

Many new brands have appeared over the past few years, continuously attracting new investment. Besides fitness apps and smart home fitness equipment, there are many gaps in the market waiting to be tapped.

Some home design brands are developing creative furniture collections that can be turned into training equipment, while beauty brands are launching fragrances inspired by fitness activities like yoga. Some laundry brands have even developed special formulas to deal with the smells generated by sweaty fitness clothes. There is also a lot of scope for new products in the sports nutrition sector too.

New-style fitness gyms supported by digital technology have seen a lot of success in recent years. The aforementioned Lefit, a 24-hour self-service gym chain based in Hangzhou, is emblematic of the new type of gyms that are attracting young users. People can enter a Lefit gym simply by scanning a QR code with the brand’s app.

The brand also has an intelligent management system that can precisely match its users, gyms and fitness instructors, guaranteeing higher operational efficiency and lower costs than conventional gyms. It also offers a pay-per-use model. To date, the brand has opened 754 gyms across the country and attracted more than 6 million users.

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 garments.

How to succeed in the smart fitness market

For companies in the health and fitness industry, now is a great time to enter the Chinese market. Nevertheless, there are some key steps that need to be taken to be able to sell fitness apps, equipment or clothing in such a highly competitive landscape.

Chinese consumers rely on word-of-mouth marketing and pay attention to recommendations and reviews of people they know or influencers they follow. They won’t buy or pay for anything they have never heard of.

Building a strong online presence for your fitness product is the most important step. The best way to do so is by launching your own Chinese website hosted in China so that consumers can find you on Baidu. You can also use other Baidu platforms, such as online forums and Q&A websites, to start conversations about your brand and learn about the needs of your potential consumers.

For Chinese consumers, the quality of items they buy, as well as the service they get when purchasing, are the most important components. In general, they don’t mind paying a bit more if they think that something is a good investment. Therefore, promoting a high-quality brand is key.

While promoting your brand, highlight its values and educate the audience about the benefits of using your products/service. You can show videos of professional athletes using them (even better if you collaborate with Chinese athletes or sports influencers) and share the opinions of experts.

Advertising your fitness business through social media, especially on platforms such as WeChat, is another great way to increase your visibility and make yourself known to Chinese users. Many Chinese people follow literally dozens of fitness blogs. Every day, they will look at their news feeds to learn about new workout routines or trendy diets.

You can also use those apps as a testing platform. WeChat allows companies to start official accounts and create WeChat stores, a cheaper option than entering big online marketplaces like Tmall or JD.com, and a way to get an idea of the level of interest in your products. If you want to promote your app, try to build it within WeChat first. This will help you reach a bigger audience, as it’s easier to share and promote within the app.

You can also open accounts on platforms such as Xiaohongshu and Douyin. Those platforms are great for lead generation and reaching a wider audience through different content formats. Xiaohongshu and Douyin also have their own marketplaces, making promoting products and increasing sales easier.

As the fitness market has boomed, so has the number of sports influencers. More and more influencers are popping up on Chinese social media, especially after the Covid-19 pandemic and Winter Olympics in Beijing.

Collaborating with fitness influencers to promote your brand on their social media accounts is one of the best ways to gain visibility and increase sales in China. Influencers can host live streaming sessions showing off your products or use your products while training. You can also collaborate with local gyms and fitness centres, introducing your products to personal trainers that can later promote them to their customers.

Although all the mentioned options are essential for branding and e-reputation, nothing will give you as much exposure as Chinese cross-border e-commerce platforms like Tmall and JD.com. Most Chinese shoppers prefer to purchase products directly from these, as they feel they are safer and more convenient.

China Consumer 2023

This article was produced as part of a series for China Consumer 2023.

Learn more about CBBC’s flagship consumer event of 2023 here.

The post Practical guide to China’s smart fitness and sports market appeared first on Focus - China Britain Business Council.

President Xi Jinping stated at the China Health Assembly last year that: “without a healthy society, there will be no wealth in society at all.” This statement gave the CPC Central Committee the mandate to make ‘Health Plan for China 2030’ a national policy. The nature of this policy has been largely overshadowed by other giant initiatives such as the ‘Belt and Road Initiative’ and the ‘Made In China 2025’ campaign. Although the figures associated with these campaigns are huge, the numbers for the Health Plan for China 2030 are also colossal. And we know that in China, when those in charge want something to happen, it usually does.

The health policy has highlighted a number of key objectives for 2030, such as: 92.2 percent of the population should reach a world standard for health (up from 89.6 percent in 2015); making 30 percent of the population health conscious through education (up from 10 percent in 2015); and decreasing the growing population of type II diabetics within China, now the world’s largest after the American Medical Association’s most comprehensive study placed the figure at 11.6 percent.

The Health Plan for China 2030 stresses a healthy society is crucial to economic development

The sportier the better

In much the same way as Europe and America has done in the past, China is starting to focus more of its attention to sport. The health policy aims to get 530 million people frequently taking part in physical exercise with teenagers regularly taking part in at least one kind of sporting activity and 25 percent of school students being “athletically superior” by 2030.

The plan for sport is already underway. The most well known aspect of this plan is football, as announced in the 13^th five-year plan; it aims to have 20,000 specialist football academies by 2020. Private business has seen this as an opportunity to “score abroad”, most evident in the wave of Chinese buying up foreign football clubs and players, with the most recent being Landa Sport Development taking what is believed to be an 80 percent share in Southampton Football Club. However, away from football, there is a much broader buzz around sport and fitness.

As an example, in 2016 the General Administration of Sport in China stated 328 marathons were held in that year, compared to 134 in 2015 and 22 in 2011. We also know that Alisports (part of the Alibaba Group) are investing £82 million into rugby in China, as well as working with the actor Jet Li and Healthmail to launch a major MMA (Mixed Marshal Arts) competition in Shanghai in October of this year.

As announced in the document, “Some State Council Recommendations for the Development of the Sport and Fitness Sector”, there is an economic goal of taking the current value of the sport and fitness industry from its 2016 valuation of RMB 1.5 trillion to over RMB 5 trillion by 2025 – more than a three-fold increase.

The sports economy in China is indeed a “gold mine”

According to The Economist Intelligence Unit, that will occupy a 3.4 percent stake in the national economy of China, with the USA trailing at 3 percent. Relative to the current economic underpinnings of the economy and consumption rate (13 percent of the world), analysts see the figures as being no castle in the sky.

Private business has been quick to act. There has been a dramatic adoption of western style sports and fitness regimes in the last five years. According to a consultancy firm in the health and fitness sector in China, SAAS, there are now over 37,627 gymnasiums in China (in comparison, the USA has 36,540). But this also suggests other significant variables to add to the mix, namely quality and culture. Is it really possible for an industry that has developed within the last five to ten years to present greater opportunity than in western countries? That is a topic of hot debate in China.

Quality care, deep culture

A lot of Chinese culture stems from Confucius, who emphasised that the teacher is the source of knowledge, which explains the relatively high reputation of a teacher in China. This also perhaps explains the popularity of class fitness sessions, such as Yoga and Pilates, and the much lower participation rate of those going to the gym for an individual workout which, in the same paper published by SAAS is only 0.72 percent of the total “fitness population”, compared to the USA’s 17.82 percent.

One reason for the low rate is quality and understanding, as well as trust. The number of those with significant understanding of health and fitness in China is small in comparison to western countries, which leaves little opportunity for those wanting to get fit under professional guidance. For instance, Sports Recovery is still a relatively fresh, if not clearly defined, area of study in China. Encompassing physical, occupational and speech therapy and lacking clear differentiation between them, Beijing Sports University was one of only four universities to offer a major in the discipline five years ago whereas today, forty similar qualifications from universities now exist, as well as the two-day gym instructor course, which is now on offer in plenty of places in China.

There are some companies and start-ups taking advantage of the more scientific and quality assured class-based fitness programmes. Founded by Americans Derrick and Kelly Cope, Synapse Pilates was the first Pilates school in China that offered training to those wanting to become Pilates teachers. With its American brand and industry champion teacher, Synapse offers one of the few fitness qualifications with a good reputation in China. Derrick says “the increase in students taking the course within the last four years has far outpaced the ten years previously.”

There has been a dramatic adoption of western style sports and fitness regimes in the last five years

A new start-up, Wellness in Sport, is also targeting the estimated 1.7 million shortfall in professional trainers the government has highlighted as an obstacle to the industry’s development (a target of 6 million professionals by 2020 as proposed in the 13^th five-year plan). They provide a Sports Science centre that combines Western and Chinese medicine as well as qualified doctors to provide reassurance and precision, something that has long been lacking in the Chinese fitness market. In mainland China, from the gym to the sports recovery hospital, the industry is very much dominated by people from the West or Hong Kong. Just as British excellence in health care has been recognised by the Chinese, so is the same feeling starting to trickle down to sport.

There are also a number of lifestyle sports that dominate the Chinese market that we are unfamiliar with in the West. Guangchangwu or plaza dancing is arguably the most popular form of fitness exercise in China where 80-100 million, mainly middle-aged and elderly, Chinese enthusiastically join in. Business also benefits from the popularity of the dancing, with phone apps such as Tangdou and 999d.com supplying everything from digital platforms to music and clothing for the dancing divas. According to Touzi Zai Xian, a Chinese investment news website, Tangdou had taken a total of £15 million during it’s A and B round of venture capital funding in under a year.

Giving it the right medicine

As a country with arguably the longest lasting independent culture in the world, China is immensely proud of its heritage. When it comes to health, there are usually two options which are considered: Western or Chinese medicine. The latter market has seen exponential growth in recent years, with a report published by Euromonitor, a market research consultancy, stating that the value of Chinese medicine in mainland China in 2011 was £50 billion, and by 2016 had increased by over 66 percent to £88 billion. But in sport and physiotherapy, it has always been western medicine that has dominated, something the government has picked up on, and in the Health Policy for China 2030, Chinese Martial Arts have been given a Five-year Development Plan, that incorporates Wu Yi or martial arts medicine.

Bai Yi Yuan, a health management company run by Ms Hu in Jiangsu Province and entering a new stage of expansion, has created a concept that utilises Wu Yi, as well as other forms of Chinese medicine, which Chinese people often find easier to relate to than the new forms of recovery and health management that have sprung up over the past 10 years.

Lucy Yan, a ohysiotherapist at Circle Harmony Health says, “Chinese medicine is an important part of rehabilitation in China which might not yet be considered physiotherapy. Western medicine is well known for its precision, but it is difficult to deny the effectiveness of Chinese medicine”.

Finding the balance, like Yin and Yang

When considering the economic underpinnings and helping hand of the government, there is strong evidence to suggest that the sports economy in China is indeed a “gold mine”, as was suggested by the Chinese ambassador to the UK, Liu Xiaoming. The evidence suggests that the key to the market place is to articulate business models in sport and fitness in such a way that not only is health emphasised, but also Chinese culture itself. This is precisely the motive of Health Plan for China 2030, which in its stress on how a healthy society is crucial to economic development, places equal emphasis on both Western and Chinese style healthy living.

Britain has a distinct advantage in sport and health with its knowledge and the skill set that provides quality to the industry, but a balance needs to be found where the best of the West can incorporate those aspects of culture the Chinese attach importance to.

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