total revenues and increases in net profits. However, it should be noted that, although more clubs are profitable, average profits are decreasing each year.
PROGRAMMING TRENDS
Programming in multi-services clubs – or even in clubs with only two offerings( fitness floor use and group exercise classes) – is moving gradually away from emphasis on 1-2-1 personal training and more toward small group training and group exercise classes. Many“ hybrid clubs”( those that offer a low-price, fitnessonly membership and then attempt to upgrade memberships for additional services uses) are capitalizing on GEX programs, specialty GEX additional-fee-paid programs, and“ exclusive group training” programs usually involving three to six people.
Clubs are also being influenced by technology trends such as interactive fitness apps( My Fitness Pal, Sworkit, MYfitCODE); club apps( Netpulse); customer engagement management( CEM and CRM) systems( Medallia, Visual Fitness Planner); and retention management systems( The Retention People, Retention Management). General“ health” apps have yet to make much of an appearance in fitness facilities programming, but are likely to soon.
With over 80 percent of American adults owning at least one“ smart” device; with the average consumer spending more than four hours daily on digital devices; and with the advances in technological feedback of recreational activities( Fitbit, Apple Watch, Garmin, Jawbone), it will soon become imperative that successful clubs integrate technologies into their member-engagement efforts. Those that do not will likely lose out to those that do. One of the trends that appears to have least affected membership market increases is the phenomenon of budget clubs and / or clubs offering low-price, fitness-only memberships. Beginning with Planet Fitness’ growth in 2005, the percentageof-budget-clubs-to-total-facilities has risen from about 5 percent 10 years ago to an estimated 35-plus percent of all clubs at present. Yet the lowering of prices has not significantly increased the number of memberships nationally. In fact, while average single-membership prices have declined yearly in that decade, memberships have risen by fractionally more than 3 percent annually.
Finally, a mostly unspoken trend is in process: the maturing of the fitness facility industry.“ Maturity” of an industry is generally accompanied by lowering of prices, takeovers of large segments of buyers by relatively few players and eventual decreases in numbers of businesses. While we have yet to witness the latter as the approximate number of fitness facilities has more than doubled( and likely tripled) in the last dozen years, prices continue to steadily decline and the large industry players now control approximately 40 percent of memberships. Thirteen of every 100 U. S. health club members are Planet Fitness members. G
Michael Scott Scudder, CEO of MSSNetwork, is a fitness industry veteran and frequent speaker at industry conferences. Early in Planet Fitness’ franchise growth, he referred more than 50 clubs that transitioned to PF franchises. MSS can be contacted at michaelscottscudder @ gmail. com or 575-613-1004.
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GearedUp | 2016 Issue 2
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