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industry research


Operators should encourage members to connect with each other via social networks


people from the lower income groups, refl ecting lower levels of awareness about the benefi ts of healthy living. There is still much education to do.


market dynamics Looking to the future, and with household incomes continuing to come under severe pressure in 2011, growth rates are likely to remain subdued; the budget sector is likely to show the strongest growth. With only around 60–70 budget clubs in the UK, the potential for further expansion of this sector is significant. Meanwhile, the top seven operators account for 23 per cent of the total number of clubs and 39 per cent of members (see Figure 2, p55), illustrating the relatively fragmented nature of the industry, which continues to be characterised by a large number of independent, single-site businesses. There is certainly still scope for further


consolidation in the industry, with several medium-sized chains – Greens and Total Fitness, for example – that would sit well within the portfolio of larger players. Meanwhile, if Mid-Ocean Partners were looking for an exit strategy, maybe Duncan Bannatyne would be interested in taking on the LA Fitness business?


overcoming obstacles In terms of growing the membership base, the 24 per cent of current non-users who would consider using a club represent an obvious opportunity – but lapsed users will have lapsed for a reason, and there are clearly also barriers to entry for those who have never used a gym; it’s up to operators to come up with club


56


formats and types of membership that will appeal to these consumers. Many lapsed users are working mothers from the ABC1 families lifestage; the key to re-engaging them may well lie in solving childcare and logistical issues rather than any issues with cost. Perhaps there is scope for clubs to offer a home babysitting service? This could even be extended, with the babysitters providing a fun, at-home fitness class for the children while mum works out. Meanwhile, for fi rst-time users, the


biggest issue tends to be cost, so maybe non-budget operators need to be cannier and take a longer-term view by signing up younger people on lower tariffs related to either their age or whether they are still in education? Other options for operators include


‘de-bundling’ memberships into their constituent parts (eg gym-only, classes- only, swimming-only) to make them as appealing and fl exible as possible. Taking activities such as group classes into community environments where people feel more comfortable – a local park or community hall – is another option. So what else can clubs do to try to


entice more people into their facilities? Mintel’s research reveals that joining fees remain a big obstacle. Although clubs are reluctant to forego this income, perhaps they could use it as more of an incentive, reimbursing members when they reach certain milestones in their membership lifetime. The cost of doing this would surely outweigh the marketing and recruitment costs associated with constantly having to attract and convert new joiners in the conventional manner.


Read Health Club Management online at healthclubmanagement.co.uk/digital There is also probably scope for


more fl exibility in the time periods for which memberships are available: not everybody has the need for a gym the whole year round – for example, students at university and summer athletes – so perhaps there is potential for more clubs to sell monthly memberships or offer


‘pay as you go’ blocks? With the explosion in smartphones


there’s surely potential for an app that helps friends and/or family co-ordinate their visits to the health club. Mintel’s research shows that a fi fth of prospective users would be encouraged to start using a club if they had someone to go with, and with social networks now a major feature of people’s lives, it makes sense for operators to encourage members to connect with each other. Established health club brands could extend into fi tness apps, which could also be used to generate new business leads. Despite the relative maturity of the


market, the prospects for the health and fi tness clubs industry in the UK look remarkably healthy. There are still a large number of prospective customers who are interested in joining up: it’s up to operators to come up with innovative, affordable and fl exible options to encourage them to do so.


Mintel is offering Health Club Management readers a 20 per cent discount on the Health and Fitness Clubs – UK report. Visit www.store.mintel.com/hcm and type in the reader code: HCM20


healthclub@leisuremedia.com michael oliver


september 2011 © cybertrek 2011


PIC: ©WWW.SHUTTERSTOCK.COM / MICK LAV


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