Business success (yes that also includes the fitness business!!) often hinges on creating strategic partnerships that allow you to provide valuable offerings of which your competition is either incapable of or not allowed, i.e. Differentiation.
Let’s face it, treadmills are basically treadmills; weight equipment is still basically weight equipment, and when you find a piece of equipment that is markedly unique, most of your customers and prospects either don’t notice, or don’t care. Plan on standing out with price? You can only go so low – and if you haven’t noticed, membership pricing is still trending lower and lower… and lower. Point being, it is very hard to differentiate your club with only equipment and lowerpriced memberships.
Compounding the dilemma is the current state of hyper-competition and overcommunication – a climate that has made being unique/different far more important (and difficult) today than it was 10 years ago. Today, people are overwhelmed by choice – choice of products, services, brands, options, etc. In this labyrinth of choice, many customers have trouble making buying decisions unless one option is clearly different or clearly more valuable. The final consumer choice among multiple options is almost always based on differences and value – both implied and explicit. It is therefore a poor choice to attempt to get ahead by simply copying or imitating your competitors. Thou must be different!!!
Does that mean that you have to give your customers more than you ever have before? – YES!! Especially if that is what it takes to differentiate you from your competition!!
How can we differentiate, give our customers more, and increase profits?
Co-branding is one very powerful way.
Remember, brand equity is created by effective promotion and consistently meeting or exceeding customer expectations. When a “co-brand” offering works, the results can be stagerring. Co-branding can give you exclusivity. Ever see the line outside of a toy store the morning of the new X-box release? Your store has the game; your store has customers – customers that buy other stuff too – a nice perk of attraction through exclusivity.
Co-branding helps you deliver value.
As business expert Michael Hammer puts it, “(It)means that you give the customer more, perhaps far more, than you ever have before. It goes beyond simplifying your customers’ interactions with you to delivering solutions to your customers’ problems, of which your products and services in their native forms are but small pieces… You can visualize the principle as a ladder with your product at the bottom and the solution to your customers’ problems at the top. The more help you provide your customers to fill that gap, the more value you add to them, which, of course, differentiates you from your competitors who are still scrambling around at the bottom of the ladder. Also, it is to your advantage to control as much of the ladder as you can – customers will be less likely to abandon you in favor of someone else, lower down the ladder, who offers less value. At the same time, your opportunity for margin and profit increase.”
Co-branding can cut expenses and drive revenue.
Tapping into the efforts of your strategic partner’s marketing can save and earn you money. For example we carry Optimum Nutrition products in a fitness club that we own and manage. As an Optimum provider we receive some excellent marketing support. Guess what – we sell more Optimum products because of it. Optimum wins, we win and our customers win!
Best-Buy, a retail heavy hitter knows the power of the co-brand – Geek Squad and Magnolia Home Theater – it’s a perfect example of co-brand leverage. It’s a win-win, specialized offerings inside of a broad provider.
Let’s take a look at a common scenario. Fitness Club A specializes in selling memberships and perhaps classes and personal training. The memberships that they sell reach a fairly broad market that includes families that have a proven interest in purchasing specialized services for their teen athletes. Logic tells us that providing a brand that delivers value and differentiates the facility is the right move!!
• Do you want to break away from the weak mold of relying primarily on membership revenue for club success?
• Can you service increased traffic?
• Do your existing customers spend money elsewhere that they could be spending at your club, if given the correct opportunity?
• Do you want to differentiate your club?
Your answers to these questions will let you know if a co-brand makes sense for your operation.
If the opportunity to drive profits gets you excited, then pick up the phone and get in touch with some of the experts and companies featured in ClubSolutions Magazine that feel the same way. Ask them if they would be interested in helping your club succeed and creating a win-win business situation.
Corey Miceli is the Founder and Owner of d1 Performance. To see if you club qualifies for an athlete performance department, visit www.d1usa.com, or call 800.806.2107.
