Customers start sweating as soon as they enter Mo Huiping’s Bikram Yoga studio in Beijing’s Pacific Center Health Club. They haven’t even begun the grueling 90-minute routine of 26 strenuous poses with daunting names like the "Full Locust" and "Spine Twisting". They’re sweating because it is 38 degrees Celsius in the room. Wei Juan, a former tour guide and full-time mother in her 30s, still remembers her first foray into "hot yoga", as it’s popularly called .
"I made it about 30 minutes before I felt so dizzy I had to leave. Talk about throwing your money away!" she laughs. "But afterwards, I realised I felt absolutely great."
Since her first yoga class in 2005, Wei has become a thorough convert, now practising five times a week and training to become a Bikram Yoga instructor herself .
Only a decade ago, nothing like hot yoga was available to the vast majority of Chinese. Gym fitness in China meant trips to a handful of prohibitively expensive hotel health clubs or cheap bodybuilding dives. Yet as middle-class incomes and health consciousness have grown, commercial fitness centres have emerged and expanded their offerings to meet the demand .
Fitness club development in China began in earnest in 2001, with the arrival of international gym brands Bally’s and Fitness First, and the subsequent emergence of local competitors. Matt Lewis, vice-president of Le Wellness, began operating clubs under the brand Evolution Fitness at that time .
"Previous to 2001, there was nothing very commercial," he says. "From 2001 onwards, it just snowballed, doubling or tripling every year."
According to statistics from the Asian Academy for Sports and Fitness, there are now 420 clubs operating in Beijing. Health clubs have sprung up throughout the city, on the top floors of swanky skyscrapers and in underground lairs off narrow hutongs. But the proliferation has been skewed towards locally owned chains. Lewis counts out the "truly foreign-owned clubs" in Beijing on nine fingers .
Most international gym brands in China are in fact operated by local partners. Bally Total Fitness, for instance, is run by its partner China Sports Initiative; the American company has not had personnel in the country since 2003. Compatriot Powerhouse Gym, meanwhile, has partnered with China’s Cy Sports Corporation and has leveraged its local connections and brand name to fuel aggressive expansion .
Powerhouse’s regional general manager Lily Li places the gym’s total China membership at 130,000, divided among 32 locations. Powerhouse entered the China market first in Tianjin in 2004, and has spent much of the last six years setting up operations in the country’s second- and third-tier cities .
Among Chinese health club chains, Terra Wellness, King Sport and Haosha have grown the fastest, each boasting about 70 locations across the country. While minority foreign players stick exclusively to the high end of the market, offering year-long memberships for EUR323 and upwards, their Chinese counterparts are all over the map in terms of both facilities and price .
This disarray is due in part to the global financial downturn and a simultaneous growth surge in new health clubs in late 2008 and throughout 2009, which sparked a pricing war. Many local clubs offered steep discounts or allowed new members to haggle for prices in an effort to stay afloat, according to Powerhouse’s Li. She said the period was a very bad time in the industry, but believes the worst of the blind development and price-gouging is in the past. However, that doesn’t mean it’s now easy to profit in the Chinese market .
"I still think it’s a very messy market because some low-end clubs are putting in very nice facilities – nice flooring, top-of-the-range equipment – but charging low-end club prices. You look at membership prices and it doesn’t make sense," says Lewis of Le Wellness. "About a third of clubs in China make money, a third break even and a third lose money."
"I still think it’s a very messy market…You look at membership prices and it doesn’t make sense"
Retaining customers is another big hurdle for commercial fitness operations. Retention rates for gyms in China – the percentage of customers who renew annual memberships – is an abysmal 15 percent, compared with 60-80 percent in overseas markets. As might be expected, the high- end segment performs notably better in keeping members satisfied and returning for a second year .
Tomer Rothschild, CEO of Ozone Fitness, which controls eight clubs in Beijing, attributed his gyms’ 50-percent retention rate to a focus on strong customer service and a wide range of group exercise classes .
"What you see in China is radically different usage patterns than a mature market. Fifty percent of Ozone members are doing group exercise and 15-30 percent use a personal trainer," he says. "So, you’re looking at up to 80 percent of your members requiring interaction with staff. In the US, personal-trainer use would be 5 percent at the highest."
The habits of Chinese gym users differ significantly from those of the Western customers, and foreign gym operators have had to shift strategies. Rather than chalking up the popularity of group exercise classes in China to East/West cultural differences, Rothschild points to the unfamiliarity with gym exercise as the primary motivator. "For the typical Chinese gym member, it is easier with instruction rather than trying to figure these machines out by yourself."
In addition to providing regular group exercise classes in yoga, Pilates, dance classes and kickboxing, high-end gyms will periodically check in with members by telephone or e-mail to ensure they feel engaged and that their needs are being met. While there are plenty of Chinese do-it-yourselfers going through their workout circuits, the Chinese gym experience is more high-maintenance .
Then there are members who join without the intention of exercising at all .
"Some people choose a gym because they get an allowance from their company, and they’ll just shower and use the sauna," says Lewis of Le Wellness. "We had some people join the gym because they said they could use the car park for free. It was cheaper than paying RMB800 a month for parking."
Ozone Fitness’ Rothschild makes a similar observation. "We actually want members to exercise. That may sound strange, but the business model for many gyms is to collect money up front for a gym membership and hope the person never comes back."
"You’re looking at up to 80 percent of your members requiring interaction with staff. In the US, personal-trainer use would be 5 percent at the highest"
CEO, OZONE FITNESS
Make a difference
In order to keep customers, gyms must stand out from the pack by offering more than prime parking spots. Given the market’s early stage of development, clubs at similar price levels tend to offer similar services and group classes. "If I step into the shoes of a consumer, it’s really hard to see the difference between [gyms] in terms of equipment they have and services they offer," says Le Wellness’ Lewis .
Older markets in the US and Europe have developed specialised gym chains that nurture customer loyalty by catering to specific demographics. Curves, for example, is a fitness club and exercise programme specially designed for women. Anytime Fitness is a 24-hour, stripped-down fitness franchise appealing to those with erratic schedules. Despite the growth in sheer numbers, this diversification of offerings has not yet emerged in China .
Until that happens, customers aren’t likely to develop a preference for a fitness centre brand; they’ll choose on the convenience of location alone. Powerhouse’s Li notes that in large cities with frequent traffic snarls like Beijing and Shanghai, members are unlikely to travel any farther than one kilometre from their home or work. If a comparable gym opens a block closer to their apartment, there is little to keep them from switching allegiances .
Frequent openings and closings also ensure gym-goers do not stay in one place for long .
Consider a now-defunct branch of Mahua Fitness and Leisure Club just inside Beijing’s North Second Ring Road, where the annual membership was just EUR43. Though it entertained no illusions of luxury – the underground club had stale air, broken treadmills, no showering facilities and smoking staff members – its membership was in the hundreds as customers took advantage of its dirt-cheap fees and convenient location .
It closed on the first of the year without warning, leaving its members nothing but a hand-written notice with a mobile phone number to contact. Li Hua, who had nine months of her membership remaining, joined a QQ group of Mahua Fitness members vowing to take legal action. A few months later, the group’s bluster has devolved into chatting about health and fashion .
"Joining that gym wasn’t worth the money," says Li Hua. "It might have been worth it if it hadn’t closed, but the air quality was terrible and there were so many people in my aerobics class you could barely see the teacher." Li adds that she isn’t actively searching for another gym, but won’t rule out joining a new one – if the location is convenient.
Outdoor action: Public parks are the people’s gyms
It’s a hazy weekday morning in Beijing, but from the hilltop in Jingshan park, you can make out the tiled roofs of the Forbidden City to the south, quiet and still at this early hour. The other side of the hill is bustling with activity. There are no treadmills or saunas, but China’s original and most enduring fitness centres – public parks – are teeming with the health-conscious .
Two lines of dancers – mostly retired women – move to the beat of bright synthesiser chords. Down the path, a small group of couples is learning to waltz, hemmed in by the badminton players, ping-pong couples and hacky-sack kickers .
Ms Zhang, a retiree in her sixties, boasts that she has been to the park every morning for the last two years. "We’re just here for exercise and to have some fun," she says .
Near the dancers, a man off by himself in a loose-fitting shirt goes through a Tai Chi sequence, slowly waving his arms and lunging to one side. The martial art attracts foreigners and Chinese looking for a low-impact morning routine .
A 15-metre rock climbing wall inside the east gate of the city’s Ritan Park provides a venue for a more strenuous workout. Widely considered to be the city’s best outdoor rock-climbing locale, the wall has attracted a steady stream of regular climbers since opening five years ago. Enthusiasts include the Touchstone Climbing Club, which meets for climbing and bouldering sessions weekly .
"What I like about climbing here is that it is not competitive like some other rock-climbing scenes can be," says Sarah, an American who has been climbing at Ritan Park since she arrived in China four years ago .
Given air pollution problems, parks may not be safe for the year-round strenuous full-body workouts required for an immaculate figure. Yet watching the climbers limber up near the blooming magnolia trees for the first climb of the year, exercising outside has its own rhythms for Sarah .
"It’s seasonal – you’ve got to build your muscles back up every year."