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Health Trends According to Scudder

The one session I was able to attend today was part one of "Health Club Industry Trends & Working with Them," which was presented by Michael Scott Scudder, owner of consulting company MSS FitBiz Connection. Michael is one of our columnists, and he always has provocative things to say about the industry. This seminar was no exception. I only wish I had had time to sit in on the second part of it.

In part one, Michael listed 10 "predictables" now and/or in the future. One of the main points that struck me was that Michael suggested that 30 percent of a club's total revenue per annum should be nondues related. This led to a discussion about whether memberships should remain bundled or whether clubs should go back to the "old" way of charging members for each program that they use. One attendee asked about how a club is supposed to track people to ensure that they are only using the parts of the club or the programs that they've paid for. Michael suggested tracking software, but he said he is still working on ways to unbundle effectively and profitably. He says that clubs who unbundle should actually see higher revenue than those who do not.

Another attendee mentioned that Microsoft's philosophy is that the more a company bundles services, the less clients value the services. Or, in other words, companies often think it's an advantage to a client if they bundle services, but few clients want all the "advantages" being offered so the bundling often has a negative effect on customers rather than the desired positive effect.

Another thing he suggested is that clubs in the mid-market should practice divergence rather than convergence. He said that a club can't be everything to everyone. However, a club can be everything to a select group of people.

Too bad I couldn't make it back for the second part of his seminar, but other responsibilities called. However, I'm sure Michael will be writing about some of these thoughts in his upcoming columns so keep reading! -Pam

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