Globalization: Embracing The Global Neighborhood
Part 2 of a 3 Part Series
By Mike Chaet
Global Trend #4: The Rise of Pre-Choreographed Workout Programs
A recent visit to Australia found 60% of all their group exercise classes are pre-choreographed. Which means the local aerobics instructor didn't design those classes, but rather went out and bought them prepackaged.
Throughout the latter part of the 70's, group exercise instructors actually taught fitness. That's not as ridiculous as it first sounds. Before what we call today group exercise programs or formal aerobics classes came about, clubs ran all kinds of exercise programs. Running programs or yoga classes, the instructors at the time were true teachers. They really cared. They TAUGHT what fitness was to their students.
"Our instructors stopped teaching and became performers."
That's what their job was... to teach fitness. Then somewhere along the line, we took our eyes off the ball as an industry and our instructors became performers. Their interest cared little for their actual students, instead focusing in on their own personal workout and the quality of their performance as if qualifying for some kind of group-ex Oscar award.
A recent visit to Moscow's Olympic stadium to watch a training program for Russian group exercise instructors showed they're still deeply entrenched in the performance aspect. That only goes so far. The advanced people rise to the top. Classes stick with the performance and they literally drive the average fitness participant out of their clubs.
This is about as stupid as an industry can get-to continually drive the average person out of our clubs when THAT'S the person you make money on. You don't make money on the person that comes in five days a week, twice a day. And as soon as you learn that, you learn how to make money in the business.
They came to the conclusion in New Zealand that it was not the personality of the instructor or the allegiance of the students. It was the standardization of the programs. So they came out with Body Pump, probably the biggest, most effective pre-choreographed workout program in the world. Body Pump provides the choreography and how to promote it. That allows a club to plug almost any competent instructor into the program.
"Standardization of group exercise classes is the future. "
Should any individual instructor break a leg, quit or leave, most any other instructor can step in and keep the class going. It's not a Broadway show that closes when the big star becomes unavailable. That kind of versatility is the way it's supposed to be.
Standardization of group exercise classes is the future. And although nobody's done it yet, the standardization of personal training programs is coming up next on the horizon. If your club isn't already doing pre-choreographed group classes, you'd better investigate more about it before you're left behind.
Global Trend #5: Branding
It's amazing to go overseas and find a McDonald's everywhere. With only local variations. In Germany, you can buy a "Royal King", but not a "Quarter-Pounder" because the metric system makes the name moot. So it was renamed according to local conventions. Different name, but same burger carried by the globally-branded name of McDonald's.
"Branding speeds up, and sometimes eliminates altogether, the customer's decision-making process"
Gold's Gym is a good example. Visiting Venice, Italy provides a tourist experience unlike anything else in the world. It's surrounded by water. The entire landscape is concrete and stone without much green. Travel is by canal gondolas and roads are actually narrow walkways where one can touch facing buildings with outstretched arms. It is a very strange place but, somewhere buried within the twisting streets and crossing canals, stands a familiar Gold's Gym.
True, it takes a savvy native to find the thing within the street maze, and the door is only a small one with a tiny sign. Also true, the entire gym's packed into a cramped space that would be small for most American club lobbies, but the fact remained that there was a modern Gold's Gym presence in a historical city that was founded in the year 421.
Another companies attempting global branding is Fitness First out of Australia, now trying to globally brand throughout Europe. One day you'll hear about them over here. Bally's is trying joint ventures with companies like Holme's Place. They're bringing Home Place to Bally's and Bally's is going to the UK. Joint ventures with the goal of global branding.
The reason companies want to brand is that branding speeds up, and sometimes eliminates altogether, the customer's decision-making process. If you're driving into a strange town and see two restaurants: Mike's Burger Joint and McDonald's, which one gives you a certain higher level of confidence at first stroke? The branded name of McDonald's, of course. You know it's a world franchise and they've got consistent quality control. Mike's Burgers would typically see local people while McDonald's takes the tourists.
The club business is now seeing a trend of companies trying to brand their organizations-fitness clubs-globally. Crunch out of New York spends most of their marketing money on branding. Officials at World's Gym office frankly admit the number one thing they're most concerned about is branding. The quality of the product, the quality of the clubs, the quality of the training... whether it's good or bad, it's all secondary to branding the name "World Gym".
Global Trend #6: Consolidation
The way to grow a business is to add new units to it. In other words, if you have a club with 50 pieces of fitness equipment and want to grow that club, increase the equipment to 75 pieces. Increasing the fitness capacity allows the addition of that many new members. Or, if you have one club, you may want to add another. Later, you might want to build the third club, a fourth or more.
However, in dealing with larger numbers, if you have 10 clubs and want to grow to 50 clubs, the best way is to acquire another group. Or consolidate two groups into one. Bally's grew their company-now at perhaps 300-plus clubs-through mostly consolidation by buying small successful chains.
It a common report in the trade journals to read about how groups acquired other groups through a process of acquisitions, mergers and consolidation. The object is for them to gain domination within a marketplace encompassing whole countries, states or provinces. This can raise quite a lot of havoc for the independent club owner. Because all of a sudden, big players come in that have a gigantic economy of scale in terms of marketing. If they also happen to have a good system, they could improve efficiencies throughout the entire organization quite rapidly. But if, in fact, they don't have a good system, they could raise quite a lot of havoc within themselves. It's a double-edged sword. Consolidation can be good or bad.
Don't let it scare you, the independent operator when seeing a group land near you, because there are poor ones as well as good ones. And those groups that are consolidating-for the sake of growth only-will probably fail. It is reported that one such group recently acquired 60 clubs in Scandinavia to grow for the sake of growth and paid way too much. They were never able to assimilate the systems. They didn't do culturally what they were supposed to do in Scandinavia. And now they're floundering, trying to get rid of those clubs. It should bring comfort to the independent club owner that these big guys may be doing far more damage to themselves than to you.
Global Trend #7: High Quality Personal Services
High quality personal services are on the move. The direction defines the trend. Sadly, most companies, most clubs, most businesses, really provide nothing more than low to average service to their members and customers. There is a very serious pent-up demand for high service companies. This is true in all industries, not just the fitness world. Think of the experiences you have in your own personal day-to-day life. When somebody happens to step up and give you good service, it's enough to freak you out! People rate amazing praise just for doing their job.
We're so service hungry as consumers that we have actually talked ourselves into the willingness to pay for what we should be getting anyway. And we'll pay extra for it in the end. Therefore, to respond to this global trend within our industry, look for quality personal services that rate extra charges like personal training.
There's a club in Indiana that has something called a High Performance Athletic Training Center-people pay big money to go there and get personal services to improve vertical jump and improving hand-eye coordination. They're very successful because people are willing to pay for quality personal services. It's a trend that's happening all over the world right now in the health club business.
Global Trend #8: Global Aging
We've all heard ad nauseam about the baby boomer group in North America. The reality is that the baby boomer phenomena is occurring all over the world. The Second World War affected the whole world.
"Global aging is what's really responsible for what we call the soft exercise movement."
That's just the way life goes. So now we have 90 million Americans in the 40 to 55 year old range and that's one-third of the entire American population. Extrapolated to the entire planet, roughly one-third of the globe falls into that category. What are the implications for the independent club operator?
These people are buying fitness memberships, trying to stay in shape and stay alive. The majority of members can't go out like they used to, run 10 miles, come back for a quick snack then go out and do another 10 miles. Older members are going to exercise; but they need a different, less strenuous form of exercise.
This global aging is what's really responsible for what we call the soft exercise movement. The soft exercise movement is simply yoga, or what's called yoga; or what's called pilates, which is really an aberration of the original pilates. And those types of activities are becoming more and more popular. Not because they're better, but because they're more appropriate to the age group.
"The current adoption of yoga and pilates is based on the law of readiness"
Pilates has been around for decades. Yoga's been around for millennium. And nobody was paying attention to it in the public. Why? We weren't ready. We weren't old enough. We wanted to do hard-impact work. Everything goes in cycles. It's based on the law of readiness.
Any club who thinks they're doing such a great job in yoga is, in reality just lucky, you've now got 90 million old people to draw from. Take advantage of it! It's good to be lucky! Sometimes, it's better to be lucky than smart. You'd rather have 90 million old people who are looking to do yoga than invent some high-intensity exercise that was just brilliantly conceived but had no customers.
Globalization: Embracing The Global Neighborhood Part 1
About Mike Chaet
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