Market report of Fat Camp market in Shanghai

Fat Camp is an experienced weight loss camp, of which objective is to lose weight while having fun. In order to give a comprehensive report of the Fat Camp market in Shanghai and help an international fat camp company enter into the market, I would like to divide the current case into three parts: market size estimation, major competition analysis and marketing strategies.

Market size in Shanghai

To begin with, I would like to research the total market size in Shanghai, which is the population of obese children. According to market reports published by Shanghai Consumer Council (see here and here), there are 1.5 million local children in Shanghai aging from 3 to 15 years old in 2013, among which 17.8% are suffering obesity. For the non-local children in Shanghai (without Shanghai registered permanent residence), their population is around 0.5 million and 12% of them are suffering obesity. Therefore, the total number of obese children in Shanghai should be 0.327 million in 2013. However, from that figure it can be subtracted 0.126 million, because children aging from 3 to 7 years old are too young to attend fat camp. Hence, the real market size for fat camp is approximately 0.2 million. Moreover, there is an upward trend of the obesity, which means the market size in Shanghai is expending and the market will grow 3% annually.

Table 1 The total number of obese children in Shanghai 2013

Major competition analysis for fat camp market in Shanghai

Your major competitors come from 5 aspects, which are losing weight at home, local fat camps, traditional trainings, hospitals and academic & artistic courses. Firstly, we assume that 40% of the obese children will lose weight at home or remain indifferent about their weight, and that is 80,000 children in total.

Secondly, local fat camps in Shanghai, such as Dream Fitness Camp and E-Body Weight Loss Camp, have been developing rapidly and they have invested huge capitals in establishing complete facilities. Taking E-Body as an example, it has a training field over 2000 acres which includes a four-star hotel, various sports fields and so on. For this part, we assume that there are 20 main fat camps in Shanghai and each of them has 300 children, which is 6,000 in total.

Thirdly, traditional sports centers and summer sports courses, such as swimming courses, basketballs courses and table tennis courses will also remain popular and a certain proportion of parents will choose this way to help their children lose weight. For this part, we estimate that 20% of the obese children will lose weight through traditional trainings, and that is 40,000 children in total.

Fourthly, besides the above two competitors, parents may send their obese kids to hospitals to lose weight. For the weight-losing hospitals, Shanghai Hongci Hospital, Shanghai Hongkang Hospital and Shanghai Forte Large Children’s Hospital enjoy a decent reputation among customers. From market report perspective, only a small proportion of parents will adopt this method, because medicines more or less would bring side effects to children. Therefore, there are only 5% of children who will go to hospitals to lose weight, and that is 10,000 in total.

Finally, parents may be more interested in cultivating their children’s academic performance and artistic skills, for which they would send their children to other courses instead of losing weight, even if their children are suffering obesity. For this part, market report assume that 10% of the obese children will attend other course and that is 20,000 in total. In general, the major competition comes from five aspects and occupies about 75% of the market, which means that 25% of the market still remains blank. Moreover, for the local fat camps, they only account for 3% of the market. Hence, fat camps still have a great potential in Shanghai and will soon expand their market share if under proper strategies.

Marketing strategies for a fat camp in Shanghai

At last, for the purpose of promoting your fat camp in Shanghai, marketing strategies under the theoretical framework of “four P” can be proposed.

First of all, it is the pricing strategy. Because obesity will not only affect children’s physical heath, and will also exert a negative influence to their mental development, parents are willing to pay for your fat camp services at a high price. Moreover, according to the report mentioned above, the overweight children are usually from wealthy families because their parents can afford expensive snacks and beverages. Therefore, it is strongly recommend to adopting the price-based costing strategy. Based on market research, the charging standard of the local fat camps in Shanghai is between 7,000 RMB to 9,000RMB for a month. For the hospital treatment and academic & artistic courses, they are charging at a price slightly below fat camps. Although traditional training is much cheaper, it needs a long cycle to reach the desired effects. Hence, if our fat camp is able to help children lose weight while teaches a love for an active, healthy lifestyle, service can be priced at 8,000 RMB per month. Considering that you are the new comer in the fat camp market in Shanghai and in order to attract more customers, it would be wise to set a price at the same level with the local fat camps while providing better services.

Second, it is the product strategy, which is also your weight-losing service. Unlike the local fat camps, you can add new elements into our camping activities, such as specialized one-on-one attention which are not often offered in fat camp market in Shanghai. In addition, we can also teach children how to ride a bike and how to fish, which are more magnetic to kids. Furthermore, you can also plus academics and artistic courses into our fat camp in order to satisfy parents’ expectation.

Finally, it is the promotion strategies. In order to attract customers, a 90% discount can be given to those who sign up your activities together. Moreover, it is advised to advertise your fat camps on TV when parents are watching it, and also pass out leaflets to parents at school.

More about fat camp market in Shanghai: market report in Shanghai / The Telegraph