Taking exercise out of the club provides new business opportunities.
The commercial fitness industry has drawn a distinct line in the sand, declaring home exercise as the enemy. People who run in the park, try the latest infomercial product or just plain work out with dumbbells at home are often classified as lost revenue. The logic is that people who work out on their own won't come to health clubs.
When & Where People Exercise, a 1995 IHRSA study co-sponsored by the Sporting Goods Manufacturers Association's Fitness Products Council, revealed that 67 percent of all health club users both owned and used exercise equipment during the previous year. The study also showed that the average fitness center patron worked out on home equipment 50 days per year, while still attending a health club another 96 times. At the time, IHRSA reported that these findings were “clear testimony that the home equipment market is not eroding the health club business, or vice versa.”
This connection between home and club exercisers overlapping is reinforced by a 1994 IHRSA study which showed that about 22 percent of health club patrons worked out both at home and in the club more than 50 times. Furthermore, these two-location exercisers, on average, visited their health club 144 times and worked out at home 117 times, averaging five workouts per week.
Clearly, then, home exercise is not the enemy. If anything, it's an ally — perhaps even an opportunity. If members are working out on their own — and coming back to the club — then operators can cash in by helping members with their home-based fitness programs.
Some are. However, the move toward peaceful and profitable coexistence between club and home exercise has been slow in coming. And those clubs that have dabbled in home exercise have done so with great hesitation, despite the evidence that sending members home happy may not hurt retention rates — especially if their happy homes contain exercise equipment.
The Retail World
If a significant portion of members want to exercise on their own, then providing and/or facilitating home equipment for members is a potential revenue stream. And, indeed, this profit center is often talked about, yet seldom acted upon. While larger chains with their own branded equipment (such as Bally Total Fitness and Crunch) have enjoyed great prosperity selling home equipment, few clubs have successfully delved into the world of retail.
“We tried [selling home equipment] a number of years back, but it never really worked out for us,” says Joe Rossi of the East Bank Club in Chicago. “We felt that we had to dedicate too much space to it, and the time and energy spent wouldn't be worth the profit that we were going to show from it.”
Conversely, 24 Hour Fitness is a big believer in selling home equipment. The chain has been developing a system to make this happen.
“Our philosophy truly is to get people exercising everywhere because we know that even if they are working out at home, they will come back to the clubs for support, encouragement and the social atmosphere that we provide,” says Mike Feeney, vice president of facilities and purchasing for 24 Hour Fitness.
One way clubs can make equipment available for home exercise is to partner with local retailers. Clubs can then display equipment for purchase.
The Club Influence
As it stands, clubs already act as showrooms for home equipment — often without realizing it. A 1997 survey from the Sporting Goods Manufacturers Association found that previous use of exercise equipment (as in a health club) influenced the decision to purchase a similar piece of equipment for the home. In fact, 30 percent of buyers of home exercise equipment cited this factor. This means clubs with equipment for sale on the premises may have a distinct advantage.
Newtown Athletic Club in Newtown, Pa., tried this approach more than a decade ago, partnering with a local dealer. “We were pretty successful selling fitness equipment 10 years ago, which was pretty forward-thinking at the time,” says Linda Mitchell, Newtown's director of marketing and public relations. “We were looked at as experts, not seen as retailers just looking to sell equipment, which helped our position.”
Despite the success of the program, however, Newtown Athletic Club eventually disbanded the partnership. “[Selling equipment] is a good thing to do if you have the space to display and stock the equipment, which we didn't,” Mitchell says. “We had to stop because we didn't have the space. It had nothing to do with hurting our memberships or retention. We found that people that have both home equipment and a membership use both. It's a win-win for the club.”
Clubs that don't have the space to sell exercise equipment (like Newtown) can still help members bring fitness home. Cornerstone Health and Fitness (Doylestown, Pa.) does.
“We don't really do home equipment, although we do recommend some of our smaller vendors as referrals,” says Jim Bishop, president of Cornerstone. “We do sell yoga videos and accessories, as well as some other small products to our members. We look at it as a complement to our class offerings, as well as a good source of additional revenue. We sell a lot of those products.”
Even clubs that don't want to sell products can make money by serving exercisers in the home. Newtown Athletic Club, for example, is among the new breed of clubs sending personal trainers into people's houses.
“By offering personal training in the home, we are able to increase our personal training revenues by getting members who may be too busy to get to the club, or not confident enough to work out in front of members to utilize one of our additional-fee services,” Mitchell says.
Before dismissing home training, consider this: Newtown charges up to double its normal price for in-home sessions. “If you look at things like these as a negative, you'll get a negative,” Mitchell adds. “But if treated as a positive, you'll get a positive.”
And, in the case of Newtown's in-home service, additional training revenue isn't the only positive. The club targets both members and nonmembers with its service, and, as a result, has seen a rise in membership.
“Approximately 85 percent of the population doesn't work out at a gym, according to most reports,” says Mitchell. “We do direct marketing to about 43,000 homes and have about 4,000 members. We are at our limit as far as those numbers go. The question is how do we get to that 85 percent that is not walking through our door? [In-home training] may be a way to bring that population in one way or another.”
San Francisco-based Club One is another club that sends personal trainers out into the field, so to speak. “We encourage our trainers to use all avenues to [reach] members and guests,” says Jill Kinney, COO of Club One. “All of this is done through the club and it gives us a distinction from the others in the area….
“Our mission is to find and retain members, and have them see results. Just working out in a club isn't enough to achieve that.”
This concept may frighten club operators who can't conceive of fitness taking place outside of their facilities' four walls. For the benefit of these operators, Derek Barton, director of public relations for Gold's Gym International (which recently signed a licensing agreement with ICON Health & Fitness Inc. to manufacture and market a full line of fitness equipment under the Gold's Gym brand name), offers these closing words of comfort.
“Home exercise is a great way for members to supplement their exercise programs, but they usually come back to the gym,” he says. “It's like technology. We have DVDs and VCRs, but people still go to the movies. They long for that camaraderie and social aspect that only going out can provide. It is the same thing with health clubs.”
Nine Products To Carry
Both small and large, these items will bring your members back for more — and bring your bottom line big returns.
Home, Sweat Home
Does your club support home exercise? Please let us know by writing to: Letters to the Editor, Club Industry, One Plymouth Meeting, Suite 501, Plymouth Meeting, PA 19462.
E-mail: [email protected].
Fax: (610) 238-0992.