Post on 14-Jan-2015
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GROWING MEMBERSHIP AND PROFITTHE FUTURE OF
FITNESS
THE FITNESS INDUSTRY HAS EXPERIENCED MASSIVE GROWTH IN THE LAST 40 YEARS…
1960 1970 1980 1990 2000 2010 2020 2030 20400
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60Health & Fitness facility attendance has become the biggest adult ‘sport’ in the Western world. Bigger than football, tennis and golf combined …Are all stars aligned for further growth?
US Adult Fitness Club Participation
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SEDENTARITY AND OBESITY
• 2030, 50% de la population US sera obèse (>30% BMI)
• Between 2006-2016 the cost of the American health system will almost double to $4.1 trillion per year*.
• It seems that our health is deteriorating at almost as quickly as these costs are increasing. The current system clearly isn’t working - there’s got to be a better way!
• Prevention
*2006 US Treasury report
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LONELINESS AND DEPRESSION
‘Healthcare costs are becoming unsustainable. Currently, in the U.S, three-quarters of the $2.8 trillion in healthcare costs are spent on chronic diseases that can be largely prevented, or even reversed, by changing diet and lifestyle.Clubs also need to understand that the real epidemic is loneliness, depression and isolation. They have the chance to create a sense of community that’s truly healing.’Dean Ornish, M.D. Club Business international. June 2013
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PEOPLE CRAVE SOCIAL CONNECTION…
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SOCIAL MEDIA EXPLOSION Facebook 1.1
billion users per month (at May 2013)
YouTube
1 billion
200 million
130 million monthly users
Foursquare
25 million users
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WE ARE IN A GREAT PLACE TO BE THE ONES FILLING UP THESE NEEDS…
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• Challenging economy
• Competition
• Price war
• High cost of new member acquisition
• After 3 years, the membership doesn’t grow anymore in most facilities and the pressure is on to not step back…
REALITY CHECK: MOST OF US ARE BEING CHALLENGED
The white paper outlines industry ‘challenges’ that pose an alarming threat to future sustainability, growth and success…
FUTURE OF FITNESS
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US: 15 millions new members join every year, 12 millions leave…
Membership retention is the largest problem
facing our industry today
OUR INDUSTRYIS AT RISK…
Reality Check• 1∕3 of members
stop attending by month 3 – that’s after an average of just 12 workouts.
• 50% of members stop attending by month 6
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Based on commodities and lacking the excitement and
social engagement of sports – We are places to run on
treadmills vs true clubs.
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Competition from the inside – We are a
stagnating industry and we have started to turn into
ourselves - We are fighting for the same customers
(segmentation) instead of innovating to attract new ones (Budget clubs; micro
Gyms)
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Competitive industries are evolving faster than us, eg:
•Virtual exercise•Bootcamp/outdoor
•Nutritional science and medicine
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THE PARADOXE Many facilities worldwide are
being hurt by low-budget competitors.
At the same time, there are successful new fitness models emerging (micro gyms) eg:• Cross Fit Studios• Orange Theory - $23 per class• Kosama, Omni, Fitness Together,
Title Boxing• Soul Cycle and Flywheel (US) –
$32 per class• Pure Yoga (Asia and US) –
$145 to $165 per month• Exhale Spa (US) – $195 pm for
classes-only membership
• People are willing to pay for value…
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WHAT DO PEOPLE WANT?WHY JOINING A GYM?
THE WHITE PAPER HIGHLIGHT 3 OPPORTUNITIES…WE BELIEVE WE CAN COMBINE THESE UNDER ONE SIMPLE HEADING
1. Health / Results
2. Exertainment
3. Community / Making friends
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It’s never a question of can you
but
will you?
Motivation
RE-THINK AND
DESIGN YOUR
BUSINESS AROUND
MOTIVATION
HOW CAN WE TELL WE ARE
DOING
MORE OF THEM ATTEND MORE OFTEN. IT’S SIMPLE.
A GREAT JOB OF
MOTIVATIONPEOPLE?
ATTENDANCE IS THE MOST IMPORTANTMETRIC IN
OUR INDUSTRY.BUT ONE OF THE LEAST
MEASURED BY CLUB OWNERS.
THIS IS A WAY GOOD INVESTMENT RETURN.
$50 a month with 2,000 members,
In a club charging
extending the average number of months a member is active by just
one mont
hequals - all to the bottom line. $100,00
0So investing
$50,000
to extend the average length of membership by will double your
investment in 12 months
one month
SO HOW CAN WE
For all the good efforts of the equipment companies, it’s not about the machines. It’s about becoming more than just a place where people come to pump iron and run on a treadmill. Leave that to the budget gyms that charge $10 a month.
TO ATTEND?
MOTIVATION ‘MANAGE’
WHAT DO YOU DO TO MANAGE MOTIVATION AND ATTENDANCE BETTER?
HOW DO THE BESTFACILITIES DO IT?
Design a high-energy workout environment Create a relationship selling and new member induction systemRecruit a team of great personal and small group trainersBuild a ‘club within a club’ system for sports and other activitiesDevelop a member education and social network communication system
MOTIVATING PEOPLE
DESIGNING A HIGH-ENERGY WORKOUT ENVIRONMENT
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Optimal Height: 7 m (23 f)Minimal Height: 4.5 m (12.5 f)
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HIGHLY MOTIVATIONAL CLUB DESIGN| STUDIO BEFORE
HIGHLY MOTIVATIONAL CLUB DESIGN| STUDIO AFTER
MEMBERSHIP SELLING AND NEW MEMBER INDUCTION
BEST PRACTICE
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MEMBERSHIP SELLING AND NEW MEMBER INDUCTION
• Focus of MCs to move away from selling membership options to become Membership Coaches responsible providing a relevant solution for a healthier and happier lifestyle
• Responsible for setting up the new member for success vs focusing only on selling membership…
• Accountable for new member attendance in first 3 months (2 visits per week as an average)
• Some key players in industry are moving away from membership sales commission and rewarding on new members’ attendance in first 3 months
HOT TRENDS
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• 80% of prospects have been member of a gym before…
• No sales commission since 2011
• They have cut from 12 sales consultant to 5 membership coaches per centre
• Setting up the new member for success
• Prices has increased and January 2012 has seen the highest number of sales ever
24 HOUR FITNESSMEMBERSHIP SELLING TRENDS
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• MCs prescribe a training plan before the membership solutions:
• It increases the perceived value and allows for an educated decision to be made
• It creates ‘buy-in’ and commitment from prospect… It paves the road for new members to become ‘addicted’ to exercise at your facility… and it creates a bond with the MC who become the first ‘friend’
• If a prospect doesn’t join, they leave with a 30-day exercise plan to do at home – My Exercise Calendar - Behaviors must align with Vision…
LMNZMEMBERSHIP SELLING
Get Fit
Together
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• Our goal is to get people to exercise, if possible in a gym and if possible, in Les Mills gym. If they don’t join today, we still want them to start exercising. At some point, we are confident they will join because they need MORE, they need motivation and we are the coolest gym in town. Reece Zondag, CEO, LMNZ
• This approach allows us to:
• Come across as true fitness experts vs sales people• Preserve the relationship• Give MCs a good reason to follow up and a real purpose behind each follow-
up call • Focus no the talk being always about exercising, their goals, where they are
at with it, inviting them to an event vs latest greatest deal
LMNZ – IMPROVE THE LIVES OF NEW ZEALANDERS
RELATIONSHIP SELLING AND NEW MEMBER INDUCTION
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NEW MEMBER INDUCTION PROCESS
• MCs are responsible and accountable for new member attendance in first 3 months - about 30% of their commission) - they sell the dream; they make sure the dream happens!
• Simple but thorough member on-boarding process facilitating consistent attendance and focusing on usage during first 12 weeks. It will set the foundation for long-term engagement.
• Regular and specific points of contact
• Tracks every new member over 84 days and visits at 14, 42 and 84 days
12% of all cancellations would be avoided if all new members visited the facility at least once per week
during the first calendar month after joining.FIA Top Ten Strategies for Winning the Retention Battle
LMNZ – GOAL: 21 VISITS IN 3 MONTHS
“
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LMNZ NEW MEMBER INDUCTION PLAN21 VISITS IN 84 DAYS
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Result:
• 50% of members achieving the 21 in 3 months (Goal is: 65%)• Average attendance per member is 1.4• Retention is 75%
Give MCs a clear and genuine reason to call • Red status: Rescue call• Orange: What more can we do to get you here more often?• Green: High-five call!
RELATIONSHIP SELLING AND NEW MEMBER INDUCTIONLMNZ: 21 VISITS IN 84 DAYS
DEVELOP A MEMBER EDUCATION AND SOCIAL NETWORKCOMMUNICATION SYSTEM
BEST PRACTICE
We need to become true providers of holistic health.
Education changes lives and your members will love you for it.
EDUCATION: BECOMING TRUE “HEALTH CLUBS”
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TALK TO YOUR MEMBERS
Create a personal relationship with your members
BEST PRACTICE
ENGAGING PEOPLE INTO ASSISTED AND SOCIAL FORMS OF EXERCISE
PERSONAL
TRAINING
TEAM
TRAINING
SPORT EVENT TRAINI
NG
GROUP
FITNESS
CREATING BONDS
• 90% of all exercisers report that they would prefer to work out in a group1
BENCHMARK FOR HIGH-PERFORMING FACILITIES• Members who attend Group Exercise
(GX) use their facility 3 times per week compared to IHRSA's figure of 1.9 member visits a week, on average.
• GX is cited as the biggest influence (40%) on how long people remain a member of a fitness facility.
• GX member retention rates are higher than other member retention rates, on average.
• 60% of people rate GX as the #1 service they specifically look at when choosing a gym.2
• Satisfied GX members refer people 3 times more than other members.
THE POWER OF THE GROUP EFFECT
THE POWER OF THE GROUP EFFECTWE KNOW IT FIRST HAND
• Independent research shows that LES MILLS™ licensed facilities have 500 more members per club than the global average.1
• LES MILLS™ class participants visit their facility at least twice as often as the average club member. 3.1 - 3.7 times per week, vs. 1.2 - 1.9 visits per week.2
• 95% of LES MILLS™ participants would recommend LES MILLS™ programs to their friends and family.3
• 71.8% of LES MILLS™ participants say they intend to remain a member of their club in 12 months’ time.3
1. Scoreboard global survey 20112. Nielsen (2010); IHRSA (2011)3. IHRSA 2009
There is absolutely a commercial connection between group fitness attendance and long-term profitable facilities!
THE BOTTOM LINE IS:Group Exercise attracts MORE MEMBERS, who attend more often, REMAIN LOYAL and attract new members THEMSELVES!
UNLEASHING THE POWER OF GF IN YOUR FACILITY
CREATE A SCORECAR
D
MAXIMISE YOUR
TIMETABLE
RECRUIT AND
RETAIN WORLD CLASS
INSTRUCTORS
ORGANISE WORLD CLASS INSTRUCTOR TRAINING
DEVELOP THE BEST STUDIO
YOU CAN AFFORD
CREATE A MARKETING PLAN
PLAN FOR SUCCESS
APPOINT OR BE A WORLD CLASS GF
MANAGER
PERSONAL TRAINING
• A big focus and passion for most managers.
• A great way to provide members with more results and motivation
• Can be a good source of secondary revenue
• A growing industry• In 2011, 6.5 million Americans
were using PTs vs 4 millions in 1999
• Despite the global economic downtown, PT as an industry grew an average of 1% per year from 2006 to 2011, while annual growth of 3.8% is expected each year from 2011 until 2016
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PERSONAL TRAINING
Contribution to weekly club attendance
And, the main factor for growth is the trend away from one-on-one training towards SMGT to increase the fun level while mitigating expenses…
PTS – THE CHALLENGE
NO ONE HAS REALLY MANAGED TO ENGAGE THE MASS…
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THE HOLY GRAAL OF THE FITNESS INDUSTRY…
TEAM TRAINING
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Contribution to weekly club attendance
TEAM TRAINING– THE CHALLENGE
NO ONE HAS REALLY MANAGED TO ENGAGE THE MASS…YET
INCREASINGCONSUMERS’ PERCEIVED VALUE
CAPITALIZING
HIITON THE
OPPORTUNITY
TELLING YOUR
MEMBERS AND
PROSPECTS WHY AND
WHEN THEY NEED TO
INTRODUCE A
HIIT COMPONENT
IN THEIR TRAINING
WEEK
6-week intervention – can HIIT/LES MILLS GRIT™ Series improve the fitness and health of fit adults?
*Cardio could be a combination of Les Mills’ BODYATTACK™, BODYCOMBAT™, RPM™ or BODYSTEP™
PENN STATE UNIVERSITY RESEARCH
THE SCIENCE BEHIND THE SWEAT
We collected data on blood, oxygen, fat and strength.
THE SCIENCE BEHIND THE SWEATTHE RESULTS
Triglyceridesdecrease
Oxygen Consumption increase
Body Fat decrease
Back Strength increase
Waist Circumference
decrease
3.1% 1.7% 0.8% 8.4% 1.0%
14.5% 6.4% 2.1% 21.9% 2.5%
-11.4%
+4.7% -1.3% +13.5%
-1.5%
GROUP 1No GRITTM
GROUP 2GRITTM
DIFFERENCE
20%
SPECIALIZED FACILITIES ARE POPPING UP EVERYWHERE…
6000+ CROSSFIT centres
€10 to 20 per workout
Growing FAST
AND TAKING A BIGGER
MARKET SHARE…
ARE YOU READY FOR THE MILLENNIALS?
STAYINGRELEVANT
ONE MORE THING…ENGAGED STAFF
“HAPPY, ENGAGED AND LOYAL STAFF MAKE HAPPY,
ENGAGED AND LOYAL CUSTOMERS.”
SOUTHWEST AIRLINES
STAND FOR SOMETHING.CREATE A CAUSE, NOT A BUSINESS. GIVE YOUR TEAM SOMETHING BIGGER THAN THEMSELVES TO FIGHT FOR, SOMETHING THEY CAN BE PROUD OF.
DISCOVER YOUR TRUE PURPOSE
CREATE A CAUSE, NOT A BUSINESS
WHAT’S YOUR VISION?
FOR A FITTER PLANET
• “We are warriors in the battle against inactivity and over-consumption.”
MI Instructor Creed, 1998
• You have to find a way to make people fall in love with fitness.”
Les Mills, 1968
• “Creating life-changing experiences every time, everywhere. One class at a time, one participant at a time.”
AIM manual
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GROWING MEMBERSHIP AND FACILITY SUCCESSBECOMING A MASTER AT DELIVERING MOTIVATION
Health and Fitness facility attendance has become the biggest adult ‘sport’ in the Western world. Bigger than football, tennis and golf combined. But we have traditionally lacked the excitement and social engagement of sports, and behaved more as gyms than as true health ‘clubs’. The faster we can change that, the bigger our future!