Are We Really as Good as We Think We Are?
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Thomas Plummer
Is this industry a wild success, as we proclaim from the stages at national conventions and to investment groups seeking to come spend money with us? Or, are we, at best, an 80-year-in-the-making failure, one which has only penetrated barely 21% of the market since its birth in post-WWII America?
We gloat on the 21%, but leaving 79% on the table does seem like failure after eight decades of doing business. It's like me going to Vegas with two grand in my pocket then getting on the plane, still giggling from the cheap drinks and telling everyone around me I am a winner because I still have a couple of hundred left.
The aha moment is we don't have to be much better to be absolutely great. If 21% is bad, then how would we define what real success would look like in this industry? As of 2024, there are approximately 340 million people in the U.S., and the fitness market has managed to grab ahold of 71 million of them, spread throughout 90+k fitness facilities and gyms.
If we were just 3% more effective, meaning adding just 3% of the 340 million to our current 21% penetration rate, we would add an additional 10 million members to the businesses in this industry. Or, stated more clearly for those depressed gym owners searching for those elusive memberships, we would instantly add over one hundred new members per facility.
Why are we so ineffective when everything in current culture is pointing our way? Over 70% of our population is obese or overweight, easily verifiable by visiting any Walmart on any given Saturday morning, yet we are not seen as the answer to this concern except by a very small percentage of them.
Perhaps, one of the most startling statistics is 10,000 people per day are turning 65, and people currently alive in this age group can expect a life expectancy of approximately 85 for men and well over 90 for women. The year I was born (1952), men retired at 65 and died a few years later, worn out by a long career and the struggle to last long enough to have a few years on the park bench. Their early demise was due to the fact that most everyone smoked, drank and never exercised. And, the women of that era barely lived much longer, gone in their early-70s, again suffering from the same angst and issues as the men.
We have been given this huge population of those 50+, and more are arriving daily, yet they do not believe we are the answer to living a better quality life through fitness. We all want to live a long life, but no one ever wants to get old, and as an industry, we should be the source of eternal youth. But, again, we are not seen as the solution they want and need to increase their health span beyond mere longevity.
We are simply defeating ourselves, clinging to our past success and denying the fact this industry needs to be reinvented to become relevant again. If science was looking for a time machine model that could transport someone back to the past, those scientists would need to look no further than the mainstream, big box business model.
There is a fitness chain with sites in multiple states where their website might be considered a direct portal to 1995. The boxes are big, often over 30,000 square feet, and the website and social media attempts to drag the potential client back to those days when one gym could be everything to everyone.
Price flashes on the screen as you search, the deal of the week included and the... oh my, hold your breath, "this deal won't last much longer call to action." Pictures of mostly young members, the occasional picture of some older dude and dudette waving from the back row of a class and wide angle shots of what a huge place this is and it can be yours at this low, low price. They sell price and everyone is welcome, but don't expect much help as a beginner unless you upgrade; and they might have a few of those old leg warmers from the aerobics days in a box in the storeroom.
Most all of our current marketing targets people who are already in someone else's gym.
The chain mentioned markets under the assumption you are working out, are maybe tired of your current gym or have just moved to this area and are completely understand what these pictures, class schedule and options mean due to previous experience as a fitness person.
But, again, 79% of the potential market looking at the site have no idea if anything the chain offers fits them. Here are the toys we offer, and we rent them per month for less than a sandwich and coffee at Starbucks. Price is irrelevant if I don't know what the price buys, but it sure sounds cheap; I obviously couldn't expect much help for that cheap fee.
If we look at the 21% as those who get us, and the 79%, those not in a gym, as the "don't get it" population, we spend all our marketing, direct all of our social media and even design our facilities for those who have some previous experience and understanding of what we do and who we help.
Big boxes worked last century, and the one size fits all concept was effective back when Bill Clinton was President, but this business plan was destroyed by the advent of the methodology driven businesses starting in 2005 and the eventual evolution of the demographic driven business model, represented by the small, target specific training gyms focusing on the top 30% of the population by affluence and other single offering facilities targeting specific demos, such as Pilates and yoga, again chasing the right age and money client to fill them.
These newer models work and verify we are evolving, moving slowly toward a more efficient method of operation, but here are a few things we still must do to expand the industry as we know it today:
Start with the marketing:
Most all of fitness marketing is flawed from the concept. We tell people how we do it, but we never mention who we do it to or if they might belong in this business...
For example, a gym marketing to women mentions all trainers are certified and are there to guide someone in fitness. This is like a restaurant advertising, "we have real chefs on duty who will make you dinner when you come in." The restaurant never mentioned the style of food or if the place might be upscale or family. The gym has the same problem because its marketing fails to answer if someone belongs there, if there are others like me and if this is small and more private or the size of Cleveland's airport.
For example, the women's gym might say, "hey, we are a small, upscale gym focusing on women over fifty who are seeking a sense of community and who want that help you need to live a long and fit second half of your life."
Understand why people in gyms actually quit:
People leaving gyms often cite the number one reason they are leaving is because of price, yet few who get what they want from a business ever leave it... price may be the excuse, but no results achieved for the money paid is the real reason. Every quarter, I clean up my credit card, eliminating apps I purchased but now don't use, but while the ever-increasing cost of Netflix irritates me, I will break a leg if someone tries to eliminate my Sunday, on the couch, streaming hours.
Also, few mainstream, price-driven gyms have any decent induction process. Maybe, maybe the new member gets a short intro to the equipment, but for the low price, you would have to severely upgrade a membership to provide help as we do it now, which doesn't work because the guy came in because it is cheap. There are a number of good ways to fix this, but when you run a turn and burn business plan, this is the last problem you attempt to solve.
Remember, no one goes into a Golden Corral, attracted by the low price, then looks to spend a hundred dollars on a bottle of wine. We create failure into the sale because the member was guaranteed failure from the first day.
If you want the member to last, meaning staying longer and paying longer, then you have to give the member workouts he or she can follow, even if they are online or sent to the members quarterly. If they get results, they stay. If they fail, they leave. Simple as that.
Kill the illusion of methodology as your source of power:
Where does your gym go when the fad of the year you are selling dies? A great example is the boot camp models. The client has been there, done that and moved on. We have seen this for decades in aerobic studios, cycle studios, circuit gyms, boot camp team training models and kettle bell only gyms. Once the luster fades, the gym is stuck selling its method rather than adapting its tools to the current time and just getting results for the clients.
Make the first step risk free:
We make it too hard to join a gym for the 79% folks. All we ask is you come into a business that terrifies you, spend ten minutes looking at equipment you don't understand, then commit a year of your life to paying to rent our stuff. The boutique style gyms simply ask you to spend more money, then toss you into a group you can't keep up with and who resent you because you are another body in a gym already packed because the circuit team model doesn't work and is always oversold at the times you want.
Training gyms and other smaller places should offer a meet and greet, where the potential client can spend twenty minutes or so exploring what you do, and all smaller gyms should offer a trial based upon try before you commit for a specific time. Risk kills the willingness to explore, so if you want clients you have not seen before, kill all risk when it comes to trying you out.
Mainstream could do well with a $29 - $39 thirty-day trial and training gyms, and more elite places should use a six-week version priced at between $129 - $299, depending on the market.
Master the demographics you are chasing and again; there is no one size that fits all:
The demographic model of fitness business will rule the coming ten years, replacing the box, one-size-fits-all-concept and the methodology driven smaller gym. Demographics, as needed for these gyms, are based upon age and affluence. Roughly a third of the country makes over $100,000 a year, which is the top tier, about a third makes between $50,000 - $100,000, and the bottom third makes less than $50,000 or so. Pick the affluence, pick the target age, then build a gym for that group.
Examples would be Fitness After Fifty, adult sports performance, yoga or Pilates, upscale women's only gyms, total support facilities which include nutrition, wellness and medical support, or a return to the body building gyms of the 90s, based up the middle $50,000 - $100,000 income level targeting Gen Z and Millennials, who would be willing to pay $49 - $99 per month for a serious workout gym and driven by today's influencers.
What all this means?
In the past, we have created the gyms we want, with as much stuff inside so everyone in the market is believed to be a target, yet in today's market, even the big retail box has proven to a dinosaur. You could ask the people at Sears, K-Mart, Sports Authority, Macy's and a host of others, but hey, they are gone because they couldn't make one size fits all work either.
Today, start with your target demographics, master that segment, then create a gym serving their needs, money, class and age. Use tools as they exist today, but remember today's hot trends is yesterday's funny picture on Google. Look up 1980s aerobics pictures or kick boxing from the 90s to relive what we should avoid.
Remember, what got us here isn't going to get us to the next level of success in this industry, which appears just to be beginning with lots of upside left if we just chase the 79% waiting to find us.
