Return of the Celtic Tiger
With a mindset for marketing, Alan Leach has guided West Wood Health Clubs through the Irish recession and back to the top.
Alan Leach’s insight into the fitness industry and its customers has been developing for almost 30 years. However, that insight hasn’t just been derived from his home country of Ireland, but instead has been crafted from seeing different aspects of the industry while teaching sales and marketing around the world.
Leach, 50, the group general manager for West Wood Health Clubs in Dublin, Ireland and Sarajevo, Bosnia, has seen the customer drastically change since he began dissecting fitness sales and marketing in his early 20s. At that point, Leach believed people didn’t really understand fitness or what it could do for them. However, the average member today has become significantly more educated, with between 45 and 50 percent of the population having experienced a gym before.
If that’s the case, what separates a customer signing on the dotted line for one gym and bypassing another? According to Leach, it all comes down to sales training. And coming from someone that has been exercising sales methods for more than 30 years, he has a major belief in sales changing a club’s culture. That’s what helped West Wood Health Clubs grow from about 16,000 members to more than 21,000.
“If I ever see the mistakes in fitness clubs today, it’s they don’t have a proper selling system where you have professional sales management, professional sales staff who have been professionally trained by professional sales trainers,” explained Leach in his deep Irish accent. “That becomes part of the culture. I do believe that if you have that, you can get through any recession. You can compete against any competitor. Because most people won’t put that work in.”
Throughout the years, Leach has developed a faith in certain marketing strategies — direct mail being one — but that doesn’t mean he believes that they work outright. “I’ve trained so many sales people over the years that I believe when you have good sales people that will do it every day, you’ll be fine,” he said.
If a sales staff isn’t properly trained to execute at a high level, the vast amounts of marketing that a club does won’t pay off. Yes, customers may come into the club, but the sales staff won’t be able to add those four to six new members before they turn and walk out the door. “When you look at the sales that we do, the sales system that we use isn’t that unique. It’s that we are committed to learning the latest sales techniques, to implement those techniques, to manage those techniques,” said Leach. “Over the years we would have about 2,000 sales and marketing books, but it’s not so much that it’s unique. It’s making sure the best-practice sales techniques are used day in and day out.”
Leach has expressed these techniques and continually emphasized the practicing of these methods for more than 20 years at conferences around the world. Those methods and his belief system captured the attention of West Wood Health Clubs in 2005. Leach understands that his systems must develop a company culture, and success will be derived from that culture.
He communicated with the owners of West Wood Health Clubs that he would come in for two weeks, and at the end of that period give them his evaluation. The trial period wasn’t to ensure whether or not he could perform the changes he needed to make West Wood Health Clubs more successful, but whether the owners and executives would give him the opportunity to make those changes.
“West Wood would be the premier player in Ireland,” explained Leach. “What actually happened was the guy I worked with before, he had some health issues. He’s fine now, but he also was a very clever man. The property that he owned was right on the doorstep of a huge billion-euro development. He got offered more money than he could refuse, and it was time to get out of the industry. And then West Wood came to me, and they very much wanted to put in place a sales and marketing system.
“Initially I said to them, ‘Look, I’ll be happy to come on board, but I will come and work for you for two weeks for free.’ I always remember because this sticks in my head. I said, ‘If I can’t implement the stuff that I need to implement you will waste your money and I will waste my time.’”
As he drudged through the first two weeks, Leach knew the exact steps he’d have to take to ensure that his marketing and sales systems could be executed to perfection. However, the business culture inside the fitness club was going to have to change. Some people on the staff were excited for the change and could see the prosperity in West Wood Health Clubs, but just like in any other business, some people didn’t desire the change.
“I came in and I was here for a week and said, ‘Here is exactly what we need to do,’ and we just moved on from there,” said Leach. “I knew in my head that if I was going to come up against resistance and couldn’t do the things necessary to do in a fitness club to make it successful, I just wouldn’t have been happy. I knew what a proper sales and marketing system in this industry is about. I know what needs to be implemented, but if I go somewhere and someone is saying ‘You can’t do this,’ or ‘You can’t do that,’ then it just won’t work. I knew that wouldn’t work for them and it wasn’t going to work for me.”
Fortunately, West Wood Health Clubs and Leach were a match made in heaven. However, even with confident systems in place, the economy can still wreak havoc on a health club with amazing sales and marketing systems. According to Leach, that’s exactly what happened.
In 2005, Leach, West Wood Health Clubs and the rest of the Republic of Ireland had just emerged from the “Celtic Tiger” — a period of economic growth between 1995 and 2000. During that time, the country saw economic expansion at an average reported rate of 9.4 percent. Following the Celtic Tiger, the economy continued to grow at an average rate of 5.9 percent per year.
“Ireland had gone from being one of the poorest countries in Europe to being one of the richest countries in Europe,” said Leach. “If you can imagine, between 2001 and 2005, people had more money than they knew what to do with. It was easy to open a fitness center; people were joining clubs and never using them. We had massive immigration. It was a wonderful time for clubs.”
At that time, West Wood was selling about 7,100 memberships a year, but according to Leach, they needed more. “The recession hit about 2008 and in the first two years we increased membership sales by about 60 percent,” explained Leach. “That was just putting in a sales system, and everything was fine. We really jumped the membership. It had gone through the roof — still doing things wrong, but really working hard.
“Then in 2008, we got the worst of the recession the country had ever seen. It was devastating. Taxes went through the roof. It was West Wood, Total Fitness and Jackie Skelly [Fitness] — they were the main players — and literally within two years, Total Fitness had gone out of business, Jackie Skelly Fitness had gone out of business and the country was hit. Property prices dropped by 57 percent, unemployment went from 3.8 percent to nearly 15 percent and the country had to borrow money from Europe, which left a debt of about €67 billion (more than $92 billion). It was a devastating time for the fitness industry.”
West Wood made it out of the recession without being entirely devastated. It continued to be the top brand in Ireland, but had been extremely wounded by the recession. “We had come through the recession. Our membership dropped ever so slightly. We’d increased our prices, kept our service up. We reinvested,” said Leach.
Then, in the last year, two budget clubs opened up beside West Wood’s primary location. Taking into account the struggles in the economy, one would think that the budget clubs would’ve hurt West Wood. However, due to Leach’s sales strategy, and the company’s commitment to excellence, members stayed and new members continued to enroll.
“We’ve had a fantastic year this year,” said Leach. “Again, when people ask me how we did that, I say, ‘Eight years of hard, bloody work.’ It’s been about having the systems in place that when the tough times come along you can ride them out. In effect, I’ve come through recessions before in Ireland, so I knew what it was like. I even went through a recession before when I was so young I didn’t know what a recession was. It was about doing the things every day that you need to do to get you through this.”
Leach said he knew when the recession hit that the weaker players would suffer because they didn’t have the sales and marketing concepts in place that would help them persevere. “I always say that I look at our sales and marketing the same as what would make you the cleanest club,” said Leach. “What makes you have the best service is day in and day out having systems and culture focused on service. Some people think that if you have a great sales system that it means you’ve got great service, but I look at the sales and marketing and believe it’s about being the best — better than any industry, not just the fitness industry. In the last three years we’ve done some really successful direct mail packages. We can bring in $1.6 to $1.7 million of a lifetime value in a campaign. Particularly in the last three years we’ve worked very hard on Internet marketing.”
Leach said that Internet marketing throughout 2013 had really been the driving factor in increasing leads and sales numbers. “We don’t sell online, but it drives through all the leads,” explained Leach. “I believe lead generation has become so easy now with the Internet, if people know what they’re doing. We don’t actually have to do lead generation with referral boxes. Some days we get so many leads from the Internet that we can’t even keep up with it.”
According to Leach, the digital marketing campaigns generate more than 30 new leads every day that are inserted directly into the team’s in-house database. In 2013 alone, Leach said that his digital marketing system has generated 3,165 new members through West Wood Health Clubs’ website.
“Our database now has over 111,000 leads,” said Leach. “In 2013, we signed up 2,347 new members directly from our in-house databases. Based on length of membership, each membership is worth at least €1,700 ($2,304.69).”
Additionally, West Wood Health Clubs have invested in Google Adwords to help increase its Internet campaign. “Google Adwords has allowed us to target so many more segments than would be possible with conventional marketing,” explained Leach. “We target people with high blood pressures, people with high cholesterol — even people who only want skinny thighs. Finally, our number-one weapon for competing? Professional sales staff, professionally trained and professionally managed by professional sales managers.”
West Wood Health Clubs, the premier health club in Dublin, Ireland, has maintained its staple through the roughest years in Irish history. When West Wood Health Clubs hired Leach in 2005, it had to have known that he would be able to increase their club’s membership base and revenue, but there was no way to foresee the impact he would have on the club in the coming recession.
As business owners and entrepreneurs, it’s important to stay in tune to new possibilities in growth, both financially and in people. Having the right people, like West Wood Health Clubs, can help you grow, but they can also help you come out on top during troubled times.
By Tyler Montgomery