-COST GYM SECT                                                    OW              OR                                      ...
oxygen-consulting/think-tankTuesday, 25 October 11
oxygen-consulting/think-tankTuesday, 25 October 11
Discuss why and how the low-cost gym                             sector is growing internationallyTuesday, 25 October 11
Neutral perspectiveTuesday, 25 October 11
50% lower                                              than                                         country average       ...
Digital                                      infrastructure                             Low                         attend...
Tuesday, 25 October 11
“A budget market hotel is one in                           which the rooms are small and                         the furni...
“Technology - Simple, easy                            to use and intuitive interface                         ...you normal...
“Low-cost options can be status                         symbols for consumers who want                              to flau...
“Over the past ten years,                         markets have moved. They have                         traded up and trad...
What do UK consumers think of the low-                          cost gym experience?Tuesday, 25 October 11
FitSpace      The Gym             members        Group                         ex-membersTuesday, 25 October 11
Text              FitSpace              MembersTuesday, 25 October 11
20%                              80%                         First gym   Previous gym experienceTuesday, 25 October 11
How much do you agree with                          the following statements?              0 = Strongly                  5...
How much do you agree with the following statements?                                                                     3...
How much do you agree with the following statements?                                   3.9             4.1            4.3 ...
How likely are you to recommend this gym?            0 = Not all all               10 = Definitely                likely   ...
How likely are you recommend FitSpace?                                7.6           7.8                 8                 ...
Net Promoter Score                  0-6              7-8             9-10                Detractor        Passive         ...
Net Promoter Score                              0          10            20            30         40                      ...
Still a member in six months time?                           7.6                       7.85                        8.1    ...
Out of industry Net Promoter Scores                               0                        40                          80 ...
Text                                  The Gym                                   Group                                ex-me...
17%                                     Males - 60%                               83%                         First gym   ...
How much do you agree with the                              following statements?                 0 = strongly            ...
How much do you agree with the following statements?                                                                      ...
How likely are you to recommend this gym?              0 = Not all               10 = Definitely               all likely  ...
How likely are you recommend The Gym?                             7                     8                          9      ...
Net Promoter Score                             0         10           20               30             40                  ...
Where are members now?                                             31%                                           Male 66% ...
How long a member?                         More than one year                                7%                           ...
26% of this group had                   experience of other gyms                                              0-3 months  ...
Shall we try                          OK, let’s go try         another gym?                             ...36% of this gro...
How likely to recommend to a friend - by club   Birmingham                       7.9                                      ...
“No frills, low-cost gym.                         Especially important for                              us students!”     ...
“The friendly atmosphere,                         knowing you are safe and                         not being judged by sta...
“Cleanliness and amount of                             equipment available”                               Female member   ...
“There was a lack of staff. I                         searched for 15 minutes before                          finding staff...
“Provide more supervison                                from staff”                               Female member           ...
“I would have liked a private                              changing cubicle”                                  Male member ...
Leading international low-cost gym brands - clubs                                                               At Septemb...
Leading international low-cost gym brands - clubs                                                                At Septem...
Planet Fitness - club growth                                                               387                            ...
£61,000/                                         £160,000                                         existing                ...
Tuesday, 25 October 11
Tuesday, 25 October 11
Tuesday, 25 October 11
Tuesday, 25 October 11
Tuesday, 25 October 11
Tuesday, 25 October 11
How members rate Planet Fitness on Yelp                         19   16        12         20         6                    ...
“I love Planet Fitness. Why?                         Because I will never find another                               gym in...
“This gym is WAY too                         overcrowded and there is not                         enough equipment to use ...
Planet Fitness - EBITDA margin (3 clubs)                                                          39%                     ...
123,332 likesTuesday, 25 October 11
276 ‘likes’                          per clubTuesday, 25 October 11
5,854 followersTuesday, 25 October 11
Tuesday, 25 October 11
Global 500 Franchise List                                       Planet Fitness                          Year              ...
“To become the world’s largest             fitness club company”                         Michael Grondahl, CEOTuesday, 25 O...
Are low-cost gyms good                                              ?                            for the industry?Tuesday,...
A compelling story                           for consumersTuesday, 25 October 11
Journalists are excited                                by themTuesday, 25 October 11
They are challenging clubs                        to examine their                       member propositionTuesday, 25 Oct...
“It has focussed me on our specific proposition - Why become    a member of Holmes Place?”          Neil Burton, CEO Holmes...
Some key questionsTuesday, 25 October 11                                              ?
Do you see a low-cost                                 or a more                           ‘operationally intimate’        ...
What is the underlying purpose           driving your business?Tuesday, 25 October 11                                 ?
What do you want your business              to stand for?Tuesday, 25 October 11                              ?
What type of business are you          passionate about developing?Tuesday, 25 October 11                                 ...
What will be your legacy to                      this industry?Tuesday, 25 October 11                                     ...
Steve Jobs                  1955 - 2011Tuesday, 25 October 11
oxygen-consulting/think-tank                                                      -COST GYM SECT                          ...
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Ray algar low-cost gym seminar Manchester UK October 2011

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This presentation discusses the 2011 Global Low-cost Gym Sector Report published by Ray Algar in October 2011

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Ray algar low-cost gym seminar Manchester UK October 2011

  1. 1. -COST GYM SECT OW OR L AL RE OB PO 2011 GL RT A STRATEGIC INVESTIGATION INTO A DISRUPTIVE NEW SEGMENT Researched and written by Ray Algar, Oxygen Consulting UK in association with PrecorTuesday, 25 October 11
  2. 2. oxygen-consulting/think-tankTuesday, 25 October 11
  3. 3. oxygen-consulting/think-tankTuesday, 25 October 11
  4. 4. Discuss why and how the low-cost gym sector is growing internationallyTuesday, 25 October 11
  5. 5. Neutral perspectiveTuesday, 25 October 11
  6. 6. 50% lower than country average price Scope to Heavy operate 24 technology hours and web use DEFINITION LOW COST GYM Ability to operate Predominantly a with a single gym-only person propositionTuesday, 25 October 11
  7. 7. Digital infrastructure Low attendance Simplicity MARKET DRIVERS Changing Affordability consumer Consumer sentiment towards clubsTuesday, 25 October 11
  8. 8. Tuesday, 25 October 11
  9. 9. “A budget market hotel is one in which the rooms are small and the furnishings minimal. The focus is on the essentials” Ian Games Outus & CoTuesday, 25 October 11
  10. 10. “Technology - Simple, easy to use and intuitive interface ...you normally have a consumer who can comfortably interact with it” Professor Evgeny Kaganaer IESE Business SchoolTuesday, 25 October 11
  11. 11. “Low-cost options can be status symbols for consumers who want to flaunt their ability to get good deals” Henry Mason, Head of Research Trendwatching.comTuesday, 25 October 11
  12. 12. “Over the past ten years, markets have moved. They have traded up and traded down. No longer is it good enough to deliver average quality to average consumers” Michael Silverstein Senior Partner Boston Consulting GroupTuesday, 25 October 11
  13. 13. What do UK consumers think of the low- cost gym experience?Tuesday, 25 October 11
  14. 14. FitSpace The Gym members Group ex-membersTuesday, 25 October 11
  15. 15. Text FitSpace MembersTuesday, 25 October 11
  16. 16. 20% 80% First gym Previous gym experienceTuesday, 25 October 11
  17. 17. How much do you agree with the following statements? 0 = Strongly 5 = Strongly disagree agreeTuesday, 25 October 11
  18. 18. How much do you agree with the following statements? 3.3 3.5Average Response 3.9 3.9 4.1 Know first name of staff team Has all facilities I need Receive emails Staff available to provide free advice Staff approachableTuesday, 25 October 11
  19. 19. How much do you agree with the following statements? 3.9 4.1 4.3 4.5 4.1 4 Average Response 4.2 4.2 4.5 Delivers on website promise Friendly atmosphere Always feel safe Helping me to become healthier Excellent value for moneyTuesday, 25 October 11
  20. 20. How likely are you to recommend this gym? 0 = Not all all 10 = Definitely likely recommendTuesday, 25 October 11
  21. 21. How likely are you recommend FitSpace? 7.6 7.8 8 8.2 7.7 7.8 Average Response 7.9 8.1 8.2 Males Members with experience of other gyms All members Members for whom FitSpace is first gym FemalesTuesday, 25 October 11
  22. 22. Net Promoter Score 0-6 7-8 9-10 Detractor Passive PromoterTuesday, 25 October 11
  23. 23. Net Promoter Score 0 10 20 30 40 19 22 NPS SCORE 28 37 37 Age group - 25-34 Males All members Females Age segment - 16-24Tuesday, 25 October 11
  24. 24. Still a member in six months time? 7.6 7.85 8.1 7.7 7.8 Average Response 7.9 7.9 8.1 Males Members with previous gym experience Member for more than one year All members FitSpace is first gym FemalesTuesday, 25 October 11
  25. 25. Out of industry Net Promoter Scores 0 40 80 72 35 NPS 33 15 14 Apple - computers Subaru - cars Jumbo - supermarkets Citybank - banks Sky - internetTuesday, 25 October 11
  26. 26. Text The Gym Group ex-membersTuesday, 25 October 11
  27. 27. 17% Males - 60% 83% First gym Previous gym experienceTuesday, 25 October 11
  28. 28. How much do you agree with the following statements? 0 = strongly 5 = strongly disagree agreeTuesday, 25 October 11
  29. 29. How much do you agree with the following statements? 3.4 3.5 3.7 3.7 4 4 4.1 Staff available to provide free advice All the facilities I needed Friendly atmopshere Helped me become healthier person Always felt safe Email with advice Provided eveything promised on websiteTuesday, 25 October 11
  30. 30. How likely are you to recommend this gym? 0 = Not all 10 = Definitely all likely recommendTuesday, 25 October 11
  31. 31. How likely are you recommend The Gym? 7 8 9 7.4 7.5Average Response 7.5 7.6 8.5 Members with previous club experience All members Males Females The Gym was first gym member joinedTuesday, 25 October 11
  32. 32. Net Promoter Score 0 10 20 30 40 4 20 NPS SCORE 21 22 36 Age group - 35-44 Males All ex members Females Age segment - 16-24Tuesday, 25 October 11
  33. 33. Where are members now? 31% Male 66% 69% Joined a different gym Not joined another gymTuesday, 25 October 11
  34. 34. How long a member? More than one year 7% Unsure 5% 0-3 months 27% 7-12 months 26% 4-6 months 35%Tuesday, 25 October 11
  35. 35. 26% of this group had experience of other gyms 0-3 months 27%Tuesday, 25 October 11
  36. 36. Shall we try OK, let’s go try another gym? ...36% of this group went on to join another gymTuesday, 25 October 11
  37. 37. How likely to recommend to a friend - by club Birmingham 7.9 8.5 Brighton 7.4 7.4 Liverpool 7.4 7.4 Males FemalesTuesday, 25 October 11
  38. 38. “No frills, low-cost gym. Especially important for us students!” Female member The Gym, Birmingham 10/10Tuesday, 25 October 11
  39. 39. “The friendly atmosphere, knowing you are safe and not being judged by staff” Female member The Gym, Birmingham 10/10Tuesday, 25 October 11
  40. 40. “Cleanliness and amount of equipment available” Female member The Gym, Birmingham 10/10Tuesday, 25 October 11
  41. 41. “There was a lack of staff. I searched for 15 minutes before finding staff. I cancelled after going just once” Male member The Gym, Liverpool 2/10Tuesday, 25 October 11
  42. 42. “Provide more supervison from staff” Female member The Gym, Brighton 6/10Tuesday, 25 October 11
  43. 43. “I would have liked a private changing cubicle” Male member The Gym, Birmingham 5/10Tuesday, 25 October 11
  44. 44. Leading international low-cost gym brands - clubs At September 2011 17 19 23 38 52 Kingdom of sports Fitinn Smart Fit Fit for free Fitness24SevenTuesday, 25 October 11
  45. 45. Leading international low-cost gym brands - clubs At September 2011 54 70 80 141 447 Basic Fit Easy Fitness Clever Fit McFit Planet FitnessTuesday, 25 October 11
  46. 46. Planet Fitness - club growth 387 309 22.5% compound 258 annual growth rate 2010 2009 2008Tuesday, 25 October 11
  47. 47. £61,000/ £160,000 existing gym 15,000 to £160,000/ 24,000 £500,000 square new feet gym Planet Fitness Club Membership Franchise from business £6.50/month modelTuesday, 25 October 11
  48. 48. Tuesday, 25 October 11
  49. 49. Tuesday, 25 October 11
  50. 50. Tuesday, 25 October 11
  51. 51. Tuesday, 25 October 11
  52. 52. Tuesday, 25 October 11
  53. 53. Tuesday, 25 October 11
  54. 54. How members rate Planet Fitness on Yelp 19 16 12 20 6 1 star 2 stars 3 stars 4 stars 5 starsTuesday, 25 October 11
  55. 55. “I love Planet Fitness. Why? Because I will never find another gym in NYC this cheap. Seriously, I spend more on peanut butter each month!” Male member Planet Fitness, New YorkTuesday, 25 October 11
  56. 56. “This gym is WAY too overcrowded and there is not enough equipment to use so I decided to buy and bring some of my own” Female member Planet Fitness, New YorkTuesday, 25 October 11
  57. 57. Planet Fitness - EBITDA margin (3 clubs) 39% 54% 42% Club - 25th Percentile Club - 50th Percentile (median) Club - 75th PercentileTuesday, 25 October 11
  58. 58. 123,332 likesTuesday, 25 October 11
  59. 59. 276 ‘likes’ per clubTuesday, 25 October 11
  60. 60. 5,854 followersTuesday, 25 October 11
  61. 61. Tuesday, 25 October 11
  62. 62. Global 500 Franchise List Planet Fitness Year Rank 2011 81 2010 157 2009 116Tuesday, 25 October 11
  63. 63. “To become the world’s largest fitness club company” Michael Grondahl, CEOTuesday, 25 October 11
  64. 64. Are low-cost gyms good ? for the industry?Tuesday, 25 October 11
  65. 65. A compelling story for consumersTuesday, 25 October 11
  66. 66. Journalists are excited by themTuesday, 25 October 11
  67. 67. They are challenging clubs to examine their member propositionTuesday, 25 October 11
  68. 68. “It has focussed me on our specific proposition - Why become a member of Holmes Place?” Neil Burton, CEO Holmes Place Central/Eastern EuropeTuesday, 25 October 11
  69. 69. Some key questionsTuesday, 25 October 11 ?
  70. 70. Do you see a low-cost or a more ‘operationally intimate’ ? future for your business?Tuesday, 25 October 11
  71. 71. What is the underlying purpose driving your business?Tuesday, 25 October 11 ?
  72. 72. What do you want your business to stand for?Tuesday, 25 October 11 ?
  73. 73. What type of business are you passionate about developing?Tuesday, 25 October 11 ?
  74. 74. What will be your legacy to this industry?Tuesday, 25 October 11 ?
  75. 75. Steve Jobs 1955 - 2011Tuesday, 25 October 11
  76. 76. oxygen-consulting/think-tank -COST GYM SECT OW OR L AL RE OB PO 2011 GL RT A STRATEGIC INVESTIGATION INTO A DISRUPTIVE NEW SEGMENT Researched and written by Ray Algar, Oxygen Consulting UK in association with PrecorTuesday, 25 October 11

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