fitness industry, New Year equals new customers. January traditionally sees a
huge uptick in our health and lifestyle aspirations, and gyms are one of the
key beneficiaries. But with most of us now looking towards our summer holidays,
the extrinsic motivator of Christmas-induced guilt has long faded. And for many
fitness brands – whose financial performance is dependent on consumer
commitment – this is where the real challenge begins.
We consistently see our clients (in the fitness industry and beyond) trying to find profitable and sustainable ways to connect with their customers. To ensure that they keep coming back, time and again. To create the high engagement levels which lead to higher value relationships. For the majority of fitness brands, this means ensuring that that direct debit which seemed such a sensible investment in January is still seen as value for money come July.
In our many years of working with the fitness industry, in the UK and around the world, the most sure-fire route to customer loyalty has been the personal trainer. People who sign up to personal training (PT) are likely to spend more, stay longer and help sign up friends and family. Customer and commercial goals work hand in hand.
Yet despite these enhanced outcomes, PT uptake remains relatively low. It’s widely perceived as fundamentally unaffordable – positioned as a premium and exclusive add-on, and priced accordingly. Most customers subsequently default to the lower cost (and lower margin) options of group classes and fitness apps in an effort to make their gym time more meaningful.
But several industry trends are indicating that it’s high time to adjust the status quo.
As in other sectors, the emergence and growth of budget brands has jeopardised the mid-priced players. PureGym has now passed the 200 site mark in the UK, having fuelled its growth with its 2015 acquisition of LA Fitness. Brands attempting to justify a premium at the top end of the market are under increasing pressure to deliver customer outcomes for their monthly fees.
The rise of the niche specialist
Consumers are increasingly able to trade in their ‘all singing all dancing’ gym memberships for brands with a much more focused offer. We see this all around us – the trainer who ran my induction at our local Fitness First has now opened a PT-only gym just around the corner from our office. Typically operating out of smaller spaces, these studios and specialist gyms have lower overheads and a wider choice of locations, tapping in to the key consumer need for convenience.
Online enters the real world
Online superstars are increasingly reaching beyond our newsfeeds. Kayla Itsines – named as Forbes’ top fitness influencer last year – channels her 9 million+ followers on Instagram through to her paid Sweat app, providing workouts and nutritional guidance for less than £3.50 a week. The Freeletics model combines similarly priced “artificial intelligence coaching” with its own apparel range. Just two of a plethora of online propositions leveraging flexibility and community, leaving traditional fitness brands as a strictly optional add on.
Despite – or perhaps because of – the challenges the industry faces, we have long felt that there is an opportunity space here. To build a new and differentiated offer which delivers the same results (both customer and commercial) but via different products and services. For our fitness clients, this could require a personal training reboot. Identifying innovative opportunities to make the outcomes of personal training more accessible – through new products, new pricing models, or new partnerships.
We regularly encourage our clients to look across sectors for inspiration. As a Londoner, I often marvel at how Uber has completely altered my perceptions of travel. The traditional black cab was previously a hard to justify luxury, even if the alternative was a significantly extended journey and an often uncomfortable and unrewarding experience. But I now regularly use Ubers to get to where I need to be. A huge part of Uber’s success has been driven by undeniably aggressive pricing and discounting, but the introduction of new products (like uberPOOL) and payment models (fare splitting) has entrenched this previously premium service in the mainstream.
We understand that it’s rarely straightforward to make a major change but clients ask us every day to help them identify opportunities to drive growth. Get in touch if you’d like to partner with us to find yours.