I just returned from IHRSA, the industry tradeshow that showcases the best of the best of fitness equipment suppliers to club operators and trainers throughout the country and the world. It’s an impressive show with over 1,000 pieces of workout equipment designed to improve the health of a population. I sat on a panel where the moderator shared that only 19% of adults belong to a health club today and that the industry spends too little time trying to connect with that other 81%. I am inspired by the opportunity the fitness industry has to make a major mark on healthcare in the US but I’m equally concerned that the ingredients required to truly be relevant and innovative are just not there. Here is how I break down the pillars:
- Equipment Manufacturers… The Big Players Get It. I would not call the fitness industry on the cutting edge of information technology but the term du jour at IHRSA was “the cloud”. The largest equipment manufacturers – Precor, TechnoGym and Life Fitness were all promoting their cloud based solutions that were designed to deliver more intelligent and personalized exercise experiences for club members. They have a ways to go to meet the expectations of a discerning consumer (and increasingly the most skeptical millennial crowd) but they get it. EveryMove made a big announcement with Precor while at the show. You can read more about it here: http://evmv.me/Zwxi98.
- Club Operators.....Many Seem Unclear and Nervous. Like many industries there are business types and then there are practitioners that are in the business because that’s what they have always known (these are not mutually exclusive by the way). Anytime Fitness is an empire of 2,200 locations. Club One is powering employer fitness programs around the country. Sports Club LA has refined the health club model for an upper echelon consumer. These clubs are thinking like smart retailers. They understand their strategic market role, the power of data, of personalized experiences and are investing (investing is not about money but it is about priorities). I think most of the club operators, however, are scared and confused and working hard to hold on to a leaky bucket business model that is going to fail without broadening out there role in the life of a member. Clubs simply can’t bring in new members fast enough to outpace the attrition of their disengaged members and therein lies great risk.
- Club Management Software Companies….Not Innovating. Great software companies innovate. I can’t tell you the number of member management software companies that said “If enough gyms operators ask us to do something then we will look to do it.” What? Why aren’t you leading the industry to help your customers provide better experiences for their members? Kudos to MindBody for taking an open approach to third parties which signals that they realize they can’t solve all the problems for a facility operator. I’m concerned that unless the software companies that control registration, billing, and scheduling don’t start leading that they will end up being disintermediated quickly and forced to change their business practices.
The solution is totally obvious. Club operators need to create personalized experience for their members based on how members want to interact with their club. Club interaction insights come from activity in the club and activities outside of the club, the data of which is increasingly available on fitness equipment, data tracking apps/devices, as well as on the club software management systems. The only path to success is if all three of the pillars mentioned above are aligned and rowing in the same direction for the benefit of the member. The industry isn’t there yet and I’m afraid we’ll see further disparity between clubs that succeed and sadly, those that don’t.