Increasing Membership & Revenues with Children's Entertainment & Edutainment Clubs and fitness centers have a competitive advantage when adding a revenue-producing CEC By: Randy White

Children’s entertainment and edutainment areas can significantly increase membership, as well as be significant revenue producers, but only if they’re designed to meet the needs of both children and their parents.

One of the primary reasons clubs are adding children's areas is that according to the U.S. 2000 Census, 36% of households are families with children living at home. With many of these families having both parents working, and with the increase in the number of single parent families, many parents find it difficult to use health, fitness or sports facilities unless their children, especially the younger ones, can accompany them and be cared for while the parent uses the facilities. It is increasingly common for all types of clubs to offer supervised child-care facilities. Even many retailers are incorporating child-care facilities in their stores. This includes many supermarkets as well as one of the earliest pioneers, IKEA.

Child-care facilities allow clubs to attract a broader market of many adults who could not or would not otherwise attend. These child-care facilities are not usually treated as separate attractions or profit centers, but rather as amenities for the adult users.

Another type of children's facility is appearing in many clubs and centers. Unlike child-care, these children's facilities are considered significant revenue producers and are designed to attract an entirely new customer base. They are called children's entertainment or pay-for-play centers. Sometimes they are marketed as children's edutainment centers when they are predominately based on children learning through play. Both types will be collectively referred to as CECs (Children's Entertainment Centers).

Related Link: Child's Play: More Complicated than it Looks

CECs are typically designed to attract children between the ages of 2 and about 8/9 years old. Most CECs charge an admission fee from $4 to $8, although sometimes they are membership based. They range in size from about 8,000 square feet to as large as 25,000 square feet. CECs sometimes also include outdoor play areas called adventure play gardens. Not only are CECs destination attractions for the children of the club's regular adult users, but they also attract a whole new group of families whose parents do not use the balance of the club.

CECs are not unique to the health and fitness center industry. They are a segment of an entire new industry called the family entertainment center (FEC) industry that started about 1989. In the FEC industry, CECs are facilities targeted to children accompanied by their parents. Most CECs are independently owned. For-profit CECs generate annual attendance from 50,000 to 200,000 children and annual revenues from $600,000 to $3.0 million

Some retailers are even adding CECs. The Toys R Us mega-store in New Jersey has a separate CEC. Many fast-food restaurants are adding CEC-type areas. McDonald's is adding large enclosed 'glass box' play areas called PlayPlace in the front of many of their restaurants. Other fast foods such as Burger King are following suit. These free play areas significantly increase the restaurants' sales.

Free standing CECs originally started exclusively with soft-contained-play equipment (the maze of plastic tubes, slides and ball pits), a restaurant area and birthday party rooms. However, admission-based CECs that rely on a formula of soft-contained-play as the sole anchor attraction are not successful. Discovery Zone followed that formula to bankruptcy twice. Although soft-contained-play is an excellent safe, indoor component for children's physical play, younger children require a more diverse variety of play options including construction, imaginative and pretend play. In addition, the soft-contained-play equipment does not work well in a mixed-age setting, since older children often intimidate and bully the younger children. Another problem with relying exclusively on soft-contained-play as the draw for a for-profit CEC is that parents no longer perceive it as having a high enough price value, since many fast food restaurants now offer free indoor soft-contained-play.

Examples of the current generation of CECs include Bamboola, a 28,000 square foot CEC our company, the White Hutchinson Leisure & Learning Group, designed and produced in 1987 for the owners of the Almaden Valley Athletic Club in San Jose, California. The edutainment center includes 23 different types of activities for children of which soft-contained-play is only one. Activities include face painting, a pretend supermarket and house, interactive water play, age-appropriate boulder climbing, a maze, library, interactive cooking, construction activities, five art studios and pretend dress-up. Outdoors there is an adventure play garden with sand play areas and a dinosaur dig set in a jungle setting. One of our more recently completed projects is Totter Otterville, a 10,000 square foot children’s edutainment center in the 45,000 square foot Johnny’s Toy store in Covington, Kentucky.

Existing clubs and centers have a competitive advantage when adding a revenue-producing CEC. Clubs and centers already have relationships with their adult members. With those relationships comes trust, which is a very important consideration when it comes to where parents will take their children. CECs can be quickly marketed to existing members, whose loyalty rapidly results in word-of-mouth marketing to new families in the area.

Related Link Children's Edutainment Centers, Learning Thru Play

CECs can generate many types of new business in addition to the walk-in entertainment customer or supervised child-care for members while they use the main facility. The second largest source of attendance and revenue is from birthday parties. Many CECs host 80 to 120 birthday parties a week. Parties can generate up to 25% of total revenue and create what our company calls exponential marketing—one child invites nine other children who enjoy the CEC, want to return on their own, as well as hold their next birthday party there.

If the CEC has edutainment or learning components, pre-school, kindergarten and early grade school field trips can generate substantial weekday day-care business as well as introduce many new children to the CEC. Edutainment components can also be used for regularly scheduled enrichment programs and workshops. Other types of potential revenue include play groups with homemakers, after school care, corporate and institutional picnics, sleep-overs and holiday and summer camps.

Designing a successful CEC means more than just filling a large room with attractions and play events. Childhood is a complicated part of life. Proper design requires an understanding of how children develop and how their relationships with their parents change as they grow.

Children are best defined by their developmental skills and needs, which evolve in an orderly sequence as they grow. Although these changes are gradual and slightly vary in timing from child to child, there are six basic developmental stages that children pass through before they reach their teens.

• infant,
• older infant to early toddler (our company affectionately calls them belly babies and wobblers),
• older toddlers,
• preschoolers,
• early grade school (6-8/9 years old), and
• young adolescence (9/10-12 years old).

The mistake many CECs have made is focusing on children in grade school or older, while overlooking the needs of younger children and their parents. Doing this cuts out a large segment of families from their market. Market studies our company has performed for facilities consistently find that about 50% of all families with children 0-17 have at least one child younger than 6, and about 25% of all families with children only have children younger than 6 years old.

Other general considerations for the design and operation of a successful CEC addition to a health or fitness facility include:

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