Authored by Garnet Moore, Executive Director, Climbing Wall Association
Indoor climbing gyms have come a long way, evolving from niche facilities catering to a small community of enthusiasts to mainstream fitness, sport and recreation centers attracting a diverse clientele. This journey has been marked by periods of rapid growth, macroeconomic downturns and increased competition. In recent years, the industry has faced new challenges.
Several gym owners from around North America have been sharing stories of stagnant or negative growth over the last four to five quarters. As the Climbing Wall Association prepares for the upcoming CWA Summit in April, a number of education sessions have been developed to discuss the current economic trends and how we can lead our businesses in times like these.
Riding the Economic Waves
Like many industries, indoor climbing gyms have been through economic ups and downs. The early 2000s saw a boom in the industry in spite of the bursting dot com bubble, with new gyms opening across North America and Europe. During the 2008 Great Financial Crisis, some gyms benefited from the rise in staycations while others suffered as nearby communities felt the brunt of the economic downturn. Changes in discretionary spending and consumer confidence inevitably affect climbing gyms. The good news is that the indoor climbing industry and our older cousins in the general fitness industry have proven to be resilient during recessions.
In the past, as the economy recovered, so did the climbing gym market. The years following recessions saw a resurgence in growth, with new gyms opening and existing facilities expanding. This period of growth continued through the pandemic and has started to ramp up in the last year, fueled in part by the increasing popularity of climbing and the growing number of bouldering-focused gyms.
As the industry grows, eventually competition among gyms does, too. Rapid expansion can lead to concerns about market saturation, particularly in urban areas where multiple gyms compete for the same members. In response to increased competition, climbing gyms often diversify their offerings. Many facilities have expanded their services beyond the stalwarts of fitness and yoga to include other amenities to attract a broader audience. Some gyms focus on creating unique and innovative climbing experiences that connect with their specific niche audiences. There are multiple ways to evolve a gym business over time and ride out economic waves, and trying to see the full picture can help when adapting to the times.
Understanding the Big Picture
In the last four to five quarters, the indoor climbing gym industry has faced new challenges. Sales have begun to noticeably slow at some gym businesses, and in some cases gyms have experienced negative growth. This trend has raised questions about the broader economic factors at play and the changing demographics of climbing’s core audience.
To help climbing gym operators better understand these issues, the CWA has released a survey ahead of the CWA Summit to present data on the current economic conditions and gym owner sentiment. (Please take the brief survey here.) The results of the survey will be shared in the session titled “Industry Economic and Market Conditions” by Matt Roberts, economist and former CEO of 5.Life.
In his session, Dr. Roberts will explore both industry and macroeconomic data to highlight some of the factors contributing to the slowdown. He will help explain to what extent the broader economy, changes in climbing’s core demographic, and shifts in the sport’s popularity are to blame.
Whether running hot or cold, the state of the economy affects discretionary spending, which in turn affects gym memberships and day pass sales. Interest rates and commodity prices also play a role, since they influence the costs of building and operating a gym and the fraction of income that consumers have left over for climbing.
The changing demographics of climbing’s core audience is another factor impacting gym businesses. Generation Z is a smaller generation than the Millennials who preceded them, and as they age into their prime climbing years, they are faced with a different form of economic precarity than previous generations. They are more likely to work multiple jobs and have higher student loan debt than Millennials when they were in their 20s. And as workers who are earlier in their careers, they are less likely to be high-wage earners who can be more insulated from the effects of post-COVID inflation.
Lastly, there remains as always questions about climbing’s popularity: What happens if climbing becomes less cool? And just as importantly, how would the industry actually know this change is happening, in a timely manner? Roberts will discuss all these variables and more in his Summit session next month.
Inform Your Business With Data
The upcoming CWA Summit will provide valuable insights into these trends and offer actionable data for gym owners, including data from the CWA’s survey on economic performance and sentiment from climbing gym owners. This survey will help identify key factors affecting the industry, which the CWA will cover at the Summit. After the Summit, a report will be sent exclusively to survey participants, informing your gym business with new data.
Please take a moment to tell us how your gym is doing, today.
In many ways, the history of our industry is a testament to climbing’s resilience and adaptability. From its humble beginnings as a niche sport to its current status as a mainstream activity, climbing has weathered economic ups and downs and increased competition. As the industry faces new challenges, organizations like the CWA are working to provide the insights and data needed to navigate the future successfully. The upcoming CWA Summit will be a crucial opportunity for gym owners to come together, share their experiences, and chart a course for continued growth and success.
This story was paid for by the sponsor and does not necessarily represent the views of the Climbing Business Journal editorial team.
