Macro Environment Analysis And Segmentation Analysis Of Australian Gyms And Fitness Centers Industry Essay.

Macro Environment Analysis

During the covid-19 period, every business organization and individual faced a huge challenge due to the drastic change in routine life. During the covid-19 period in the year, 2020 government has imposed the lockdown which has shown a significant impact on the fitness industry as Australia spends additional than $8.5 billion annually on fitness, and a huge part of this is spent on membership in fitness centers, personal coach, and boot camps.

This report will examine the macro environment analysis of the Australian gyms and fitness centers industry to examine the threats and opportunities in the macro environment of the organization and also the segmentation analysis which will show the different segments which are related to the fitness industry growth and disruption. In last this report will comprise some recommendations for the most attractive segment of the fitness industry.

The outbreak of the covid-19 epidemic in Australia has forced the Australian government to impose a lockdown which comprises closing of all fitness centers, organized sports, sports events, and the whole fitness industry. This political decision result in a huge loss to Australia's economy as Australian fitness centers contribute a total of $3billion.

Additionally, the Commonwealth and the Australian Capital Territory (ACT) Governments come together to support the Australian business which has impacted due to the covid-19 pandemic. The government has announced that $10000 for businesses with turnover greater than $2 million and less than 5 million, similarly $30000 for employing a business with a turnover greater than $10 million, In this fitness and sports industry for instance gyms, personal trainers are also eligible to apply for the grants. It is an opportunity for the Australian organization to face the challenges that occurred due to the political decision taken during covid-19.

In the Australian economy, fitness centers contribute $3 billion, and a huge amount of employment in the fitness sector is on a part-time or casual basis. The influence of the fitness business spreads outside its contribution to the economy. The segment plays a vital role in refining the physical and mental well-being of Australians. As an outcome, the fitness industry carries a variety of long-term social and economic advantages to Australians. It has been projected that the price of physical idleness to the Australian economy is projected to be $13.8 billion.

Moreover, this covid-19 which has an impact on a global level has impacted the fitness industry of Australia in a significant manner as the entire employment contribution is 35,000 people, and the number of o totals 6,426. Thus the compulsory shutting of gyms in Australia due to the limits to stop the banquet of COVID-19 has had a huge influence on the fitness industry.

As per the report of fitness Australia on the impact of covid-19 on the fitness industry, it has been observed that in a survey with gym professionals and trainers it has been observed that around 71% of fitness trainers have not had a single customer since the March lockdown.

During and in the post-covid-19 period the customer behavior has been changed due to the concern of infectious disease. Everyone is concerned about the covid-19 infection which leads to canceling the memberships of fitness centers and also not joining gyms due to health concerns. Moreover, it is expected that it can notice a fall in the fitness industry in the upcoming three-year form 2021 because it will take time to generate trust and belief among people that fitness and gym are very important for good health which can result in better immune and strong physical power.

Political

Technology has supported every field which has faced challenges during the covid-19 period such education field as the shift to online learning through various technological innovations. In the fitness industry novel trends across the sector have been rising the competition and saturating the marketplace. For instance, smart fitness wearables and fitness technology, online training classes, and many others. Technology has supported the fitness industry and also the fitness professionals as with the help of technology professionals can provide fitness and yoga session or lives stream group workouts through online video conferencing. Moreover, fitness organizations have invested in developing new smart technology wearable which helps in maintaining the health through monitoring the energy burned in a day, steps moved, oxygen and blood level testing. Technology can support the fitness industry is growing with the upcoming year.

In all directions, Fitness Australia is acknowledged by the Divisions of Fair Trading as the uttermost business body and thus, works with the Government on Code management, obedience, assessment, and criticisms management process. It has recently been announced that in Australia and especially in South Australia in light of current changes to boarder boundaries in our state, it is serious that the fitness industry remains agreed to all current protocols that are put on to the fitness segment. This legal restriction will definitely impact the fitness industry in the upcoming year by slowing down the profit of the fitness industry.

Environmental factors comprise how businesses communicate with and influence the natural atmosphere. It is now going on drifts for all the industries to be extra ecologically friendly and to decrease their carbon releases which can be a way to promote and attract a customer who is concerned about the environment and who mostly prefers to buy from a sustainable business. This will influence how industries in the fitness and wellness business function; precisely by saving resources for instance water and electricity. By inclined in the direction of this movement and building an exertion to be extra aware of ecological influence, industries in this sector are probable to be perceived extra completely by clients.

In the year 2020, about 1.7 million peoples in Australia between 25 and 35 years take part in fitness or gym activities[5]. Gym and fitness undertakings were minimum widespread among individuals below the age of 18 and in the 55 to 64 age group. Also, while seeing the social factor of macro analysis fitness centers and gyms are suffering from lower demand due to the health concerns but over education and several motivation by the government can stimulate and motivate people to start a physical exercise and join some fitness centers where they can get professional learning of exercise and workout.

In Australia Young adults of age 18 - 34 are the major age group who recurrent the gym at 60.60%. It is trailed by the 35 to 54 age group at 30.70%. Temporarily, associates below 18 years of age are about 16.10%. Political, legal, and social factor have impacted the demographic segment by reducing the number of people choosing fitness centers due to safety issues.

Economic

In this segment there comes two kinds of the population in which the first population is those who love to maintain a healthy lifestyle and personality. Thus prefer physical exercises and workouts. In the year 2020, approximately 1.7 million Australians between 25 and 35 years contributed to fitness or gym activities. 

The second kind of people is those who are more conscious about the infection and covid19 and start dropping their membership or new plan to join fitness centers.

So, according to the analysis Australians of age 25 to 35 mainly participated in and contributed to the fitness industry. So, fitness industry players can target this age group since it is the most appropriate segment who are interested too, maintaining their physical health and wellness. Industry players can invest in technology and also promotion through social media as most of the Australian community is using social media platforms.

While limits are still in place all across the international market, people are starting to develop out of lockdown. Industries should start to think about familiarizing themselves with consumers’ behaviors to not only continue but thrive in a post-COVID world. Moreover, industry players can also more emphasis on online personal training sessions, and virtual health and fitness workshops. As this will help the industry to target those people who have less time and also those who have an issue. To attain fitness objectives, numerous peoples require extra help. Deliver even extra worth to your associates by providing nutrition and fitness coaching. Frequently, nutrition, stress management, and outlook can stand in the manner of weight loss and living a wellness routine. Coaching sessions can be passed out virtually from the comfort of the consumer’s home.

Conclusions

This report has examined the macro environment analysis and segmentation analysis of the gyms and fitness centers industry which have concluded the impact of various macro-environment factors which have concluded that the gyms and fitness center industry has been profoundly impacted by the covid-19 pandemic situation and macro environment factors. The influence of the fitness industry spreads outside its contribution to the economy. The sector performs an essential role in refining the physical and mental fitness of Australians. But the impact of covid-19 has severely impacted the industry. Thus, industry players need to focus on the use of technology to cope with the challenges. Some of the major ways technology can be used by industry experts are virtual workout sessions, smart wearables, and many other kinds. 

References

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Gallo, L.A., Gallo, T.F., Young, S.L., Moritz, K.M. and Akison, L.K., 2020. The impact of isolation measures due to COVID-19 on energy intake and physical activity levels in Australian university students. Nutrients, 12(6), p.1865.

Pizzo, A.D., Baker, B.J., Jones, G.J. and Funk, D.C., 2020. Sport experience design: Wearable fitness technology in the health and fitness industry. Journal of Sport Management, 35(2), pp.130-143.

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Statista., 2022., Number of fitness and gym participants in Australia 2020, by age. [Online] https://www.statista.com/statistics/884599/australia-fitness-and-gym-participation-by-age/ [Accessed 09/04/2021].