The Growth of 24/7 Gyms in Australia

Screen shot 2013-07-05 at 3.39.49 PMNigel Miller, the director/franchisor of Plus Fitness, recently spoke with Club Solutions about the growth of 24/7 gyms in the Australian marketplace. Plus Fitness is a 24/7-gym chain with over 50 locations in Australia, with many more in the works to open.

CS: What health and fitness trends are currently being seen in Australia?

NM: Over the past two years we have seen a very aggressive shift towards the use and demand within the 24/7 gym sector in the Australian fitness industry. This has resulted in the rapid growth of four brands; two international and two domestic, with us being one of the two Australian-owned players. This growth has been driven by the consumers’ needs changing and their demands for more convenience and lower price points increasing, thus pushing the trend.

This has in turn had a detrimental impact on the traditional big box gyms, with Fitness First alone off-loading or closing 24 of [its] 98 sites over the past 12 months, which has further assisted in fueling the growth of the 24/7 sector. The downturn of big box clubs comes from their challenges in being able to compete on price with the 24/7 gyms, based on the larger footprint required to accommodate services such as aquatics programs, instructor-lead classes and child minding, which [are] largely not offered by 24/7’s. Add to this a downturn in member numbers for [big box gyms], as 24/7 gyms continue to open across Australia by the day, then it is not hard to see why this trend continues.

Other trends to watch is the growth of CrossFit, which is increasing in popularity in the more experienced exercise segment of our target market as an industry. Plus Fitness has recently introduced a CrossFit Station that is presently being rolled out across our gyms to combat this shift in trend.

CS: What group exercise classes are currently popular in Australia?

NM: The Les Mills portfolio of classes remains the major player in the Australian market and has been for over 15 years. Over recent years they have been challenged by the likes of Radical Fitness and Zumba® programs, however they have stood strong with there now being somewhat of a downturn in the Zumba “craze.”

CS: Health and fitness wise, what are some common issues Australians struggle with?

NM: There has been a well-reported increase in the hours that Australians are now working. This, added to an increase in the rates of obesity across Australia, and the press that both topics regularly attract, has had an impact on the volume of Australians joining gyms. Both have fueled the growth in 24/7 gyms with the former comment increasing the need for more convenience of accessibility, which 24/7 gyms naturally deliver to the market.

CS: How does Plus Fitness differentiate itself from other gyms in the market?

NM: Plus Fitness 24/7’s key points of difference in the market place are driven by its non-contract memberships providing members with the security of being in control of their membership. Add to this a strong customer service culture, [and] we have been able to retain below-industry benchmark attrition rates for our entire 16 years of trading. Our Virtual Instructor Class Program, “Classes on Demand,” has also separated us from our competitors and provides a further ability to compete with the big box clubs by having a class offering, yet maintaining our low-prices point, smaller footprint, 24/7-model.

CS: In the U.S., small group training has become popular. Is it gaining traction in Australia as well?

NM: There has definitely been a demand for this service, however it remains stable. Group training in Australia is dominated by outdoor training companies of which a number have successfully franchised across Australia over the past few years.

 

By Rachel Zabonick

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