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Home > health club craze pumps up fitness accessory business

With health club memberships at an all-time high and projected to increase further, the outlook for the fitness equipment and related accessories category is one of continued steady growth.

Recent data indicates an estimated 31 million Americans belong to health clubs, and that number will swell to 50 million in 2010, according to the International Health Racquet & Sportsclub Association. Also, there are nearly 16,000 health clubs, compared to 12,600 facilities in 1995. Approximately half of the current 31 million members, (about 15.8 million people) belong to commercial clubs, representing a 15% membership increase from 1998. The remainder are members of university and military facilities, hospital-based clubs, corporate fitness centers, aerobics studios, country club fitness centers and spas.

Health club memberships are an important demand indicator for fitness equipment because those who work out regularly are more likely to buy equipment for home use, as well as purchase a variety of accessories such as workout gloves, jump ropes, exercise mats, ankle weights and dumbbells. Secondly, membership growth at health clubs and increased participation in fitness activities bode well for the entire sporting goods category--those who exercise regularly are more likely to golf, play tennis or participate in other activities.

While desiring to look and feel good, health club members also work out to enhance their performance in other sports, manifesting itself in the use of treadmills and free weights. Both activities have seen huge increases in participation. Free weight use increased to 42.8 million participants in 1999 from 26.7 million in 1990, according to the Sporting Goods Manufacturers Association. Treadmill use during the same period increased to 37.5 million participants from 11.5 million.

To capitalize on these trends and capture a share of the growing market, retailers fall into a good, better, best strategy. At the good level, discount store operators focus on the faster turning accessories and less bulky aspects of the category. Accessory products such as water bottles, dumbbells, jump ropes and floor mats are routinely found in discount stores. Target seems to be focused exclusively on this area.

In keeping with Target's emphasis on store brands, however, the retailer introduced a fitness brand called ProSpirit. The line includes all manner of accessories: yoga mats, medicine balls, neoprene covered hand weights, swim goggles, pedometers, padded ankle weights, a stopwatch and a 115-lb. junior weight set. With the exception of the latter, the products are merchandised on peg hooks in a 16-ft. section dominated by the ProSpirit brand. Target doesn't sell treadmills or weight machines in its stores or on its Web site, despite its female dominated customer base and the increased popularity of weight lifting among women.

Wal-Mart, on the other hand, has routinely stocked weight machines and treadmills, and consistently promotes fitness equipment. In a 16-page direct-mail circular with prices valid during the first week of January 2001, a full page was devoted to the category. Featured items included a $199 Impex brand multiple station gym, a $147 Stamina brand smith machine with a lat pull-down attachment and a Weslo brand treadmill with three sets of dumbbells for $284. The same treadmill was offered at the same price in a late November Wal-Mart circular.

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