Generational Shift: How Gen Z and Millennials are Prioritizing Health and Fitness
In a recent discussion, Alex Perry, a leisure analyst at BFA Securities, highlighted the significant trend of younger generations, particularly Gen Z and Millennials, increasingly prioritizing their health and fitness. This shift is reflected in their spending habits, with Gen Z investing 2.8 times more than Baby Boomers on fitness-related activities, while Millennials spend three times more. The conversation delved into the implications of these trends, including the resilience of fitness spending during economic downturns and the influence of social media on wellness trends.
Gen Z and Millennials Drive Health Trends, Sparking Optimism in Fitness Sector
In a significant shift towards healthier lifestyles, recent data from Bank of America (BFA) reveals that Gen Z and millennials are prioritizing fitness and wellness like never before. This trend has prompted bullish commentary from analysts, highlighting a potential long-term impact on the fitness industry.
Generational Spending Surge
Alex Perry, a leisure analyst at BFA Securities, shared insights on the growing financial commitment of younger generations to their health. According to Perry, Gen Z is spending an astonishing 2.8 times more on fitness than baby boomers, while millennials, the largest spending cohort, are investing three times more. This surge is primarily directed towards traditional fitness clubs, such as Lifetime and Planet Fitness.
A Shift in Lifestyle Choices
The data indicates that this generational shift extends beyond gym memberships. Millennials and Gen Z are not only exercising more but also adopting healthier eating and drinking habits. Perry noted a notable increase in spending on non-alcoholic beverages, with purchases of non-alcoholic beer and seltzer averaging 28% higher than their alcoholic counterparts since 2021. This trend reflects a broader cultural movement towards wellness, with younger consumers focusing on healthy aging and recovery practices.
Resilience Amid Economic Uncertainty
With concerns about a potential recession looming, Perry reassured that the fitness industry has historically shown resilience during economic downturns. He referenced data from the 2008-2009 recession, where fitness clubs maintained steady sales and even expanded profit margins. This suggests that consumers are less likely to cut fitness expenses compared to other discretionary spending.
Investment Opportunities in Wellness
Perry identified Lifetime Group as a standout investment opportunity, citing its proactive approach to emerging wellness trends. The company has quickly capitalized on the rising popularity of activities like pickleball, integrating them into over 80% of its clubs. Additionally, Lifetime is rolling out cold plunge tubs, aligning with the growing interest in cold exposure therapy.
The Role of Social Media Influencers
The influence of social media, particularly platforms like TikTok, cannot be overlooked in this wellness revolution. Perry emphasized that increased engagement on social media correlates with heightened interest in health trends. Brands like Shark Ninja are leveraging this trend effectively, promoting products such as the Shark Kyro Glow mask, a red light therapy device, through viral marketing strategies.
As Gen Z and millennials continue to prioritize their health, the fitness industry stands poised for growth, driven by changing consumer behaviors and innovative companies ready to meet their evolving needs.
