Gyms Lose Favor, Gym Reimbursements To Follow

An article in the Wall Street Journal discussed the growing market for online fitness classes and services, like ClassPass, that offer a set number of visits to participating fitness boutiques and gyms in a given city for a monthly fee. As a result of these innovations, many people are choosing to ditch their gym memberships for more flexible and often more affordable alternatives. According to data from Cardlytics, payments to on-demand fitness services jumped to 7.7% of total spending on workouts last year, up from 4.8% two years earlier. Spending for on-demand fitness now exceeds spending at yoga and Pilates studios. Traditional gyms still comprise the vast majority of the market but have lost 5% of the market to 73% in 2016.

All signs point to further deterioration of gym memberships. Consumers are becoming increasingly accustomed to on-demand access, choice, and lower costs, all of which are available from alternative options currently eroding gym memberships. This trend should raise interesting questions for wellness coordinators, employers, and health plans that promote or offer gym reimbursements. Gym reimbursements are typically limited to traditional gyms, and if sponsors of these programs truly want individuals to utilize this benefit, they need to update programs to address current trends. This goes beyond just allowing reimbursements to cover streaming services or alternative membership plans. Some individuals love to run, hike, or bike outdoors, and these activities come with their own costs (shoes, equipment, etc.) that sponsors should want to reimburse for because they provide the same benefits as going to a gym. However, this is not the case in most programs. Most programs are limited to traditional gyms, and by doing so, they completely ignore the growing desire of employees to engage in non-gym fitness activities.

As an alternative to traditional gym reimbursement programs, Wellable suggests employers build programs that tie the reimbursement to tracking of the physical activity, and individuals can choose what activity best suits them. By verifying these activities have occurred, program sponsors can not only meet individuals where they are but can also link the reimbursement to verified activities. This helps solve the problem of paying for gym memberships that are never utilized.