Is £5 for a monthly gym membership a sustainable business model, or is it simply a headline-grabbing marketing tool?
DAVE WRIGHT CEO, Creative Fitness Marketing
T
his low membership fee, with a view to making revenue from auxiliary products, is not a new play. It’s something JJB tried five or so
years ago with its Mi-Gym brand, before the recession hit its retail business. Sales are the only thing that can drive
revenue to a business, so what Sports Direct will be working on very closely is the revenue per visit. In the same way that the fi tness industry looks at selling supplements, these guys will be working on the retail play. This will be a massive threat to other
operators – particularly the budget operators –
PETER ROBERTS CEO, Pure Gym
T
he Sports Direct £5 gym membership is unsustainable if it wishes to make a genuine commercial profit. However, it’s an attention grabbing marketing tool
and will no doubt help sell its sports goods in- store, which are being overtaken by online sales.
“The Sports Direct £5 gym membership is unsustainable if it wishes to make a genuine commercial profi t”
The low-cost gym market has many established operators offering a
wide range of facilities, and experience shows the members are looking for high standards in services and products; they’ll walk with their feet if these are not provided. Service and standards, location and products will become the most important elements in customers’ choice, rather than an obviously unsustainable low membership fee that cannot fulfi l all these essentials or give a satisfactory return to the operator.
January 2015 © Cybertrek 2015
because the rent will be low, the location will be convenient and they are saying that the service will be personable. (But we all say our service will be great!) There’s no doubt it will be busy, and
if they’re not going 24/7, then workout hours are going to be crammed into a shorter time period. This could lead to the sites being too busy – from the gym equipment all the way to the car park – which could negatively impact on the user experience. I think that will be one of the key issues to deal with.
JAN SPATICCHIA CEO, énergie Group
H
aving had direct insight into Sports Direct’s plans for the
fitness sector, and hearing it from Mike himself, I think the industry needs to take this move seriously. You only have to look at Sports Direct’s history to see that, when it ventures into a new area, it does so in a big way. With substantial financial resources at its disposal, as well as international reach, it will hit the market hard and fast. Operators across the industry that are cynical should, in my opinion, think again: I wouldn’t bet against Sports Direct! From the énergie Group’s perspective, as the
UK’s leading fi tness franchise, we see Sports Direct’s entry to the market being a bigger threat to the ‘big box operators’ than it is to us. For énergie, it’s our locally owned clubs – operated by passionate franchisees – that really make the difference. Anything that shakes up the market and keeps operators on their toes is very welcome and we wish them all the best. ●
Read Health Club Management online at
healthclubmanagement.co.uk/digital 41
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