The fitness club sector is undergoing a demographic transformation with significant implications for investors. Millennials and Gen Z now account for nearly two-thirds of memberships, led by a 7% compound annual growth rate (CAGR) in members under 25 years old over the past three years. This surge is driving accelerated innovation in services, facilities, and business models, and will continue to propel the industry as the youngest Gen Z members do not turn 18 years old until 2030.
High-volume, low-price (HVLP) clubs are responding and leading the industry as the core demographic changes. With monthly dues as low as $10–$15, flexible commitment terms, and non-intimidating atmospheres, HVLP formats remove barriers related to cost and convenience. As a result, overall fitness club memberships in the U.S. have climbed about 20% since 2019, with HVLP formats contributing more than 60% of that growth. Additionally, overall fitness club penetration rates are approaching 25% of the population, up more than 600 basis points in the last decade.
Women, in particular, show a strong affinity for HVLP concepts, presenting an additional avenue of growth. The combination of demographic momentum and cross-gender appeal suggests a robust and expanding addressable market for operators that can continuously adapt to shifting consumer expectations.
For investors, the thesis is clear: the industry is becoming more bifurcated between fitness brands that strike a balance between accessibility, affordability, and comprehensive fitness solutions and those that focus on premium, boutique experiences. Operators excelling in service innovation with disciplined business models are best positioned for sustained performance. Next-generation HVLP gyms, tailored to the demands of Millennials and Gen Z, call for investment strategies that prioritize adaptability, technology integration, and scalable growth. In short, success will favor those aligning with younger generations’ wellness aspirations while adaptability, both for operators and investors, will be a defining advantage in a market driven by generational preferences.
For more information, please see our equity research report, High-Volume, Low-Price Fitness Clubs Are Driving Growth and Investment, or visit our Equity Research Rewind landing page for other topics on our website.