Your cycling studio could be the secret to transforming your biggest threat into a growth opportunity.
Frequently named in industry reports as the most popular group exercise class category, group cycling has enjoyed major growth in recent years, fueled by advances in technology and a raft of new concepts. Unfortunately, though, many cycling studios within multi-purpose clubs sit empty for 80 percent of opening hours. Not only is this a waste of expensive real estate, it also has a detrimental effect on business return. Clubs running just two to three cycle classes a day could be missing out on up to $190,000* a year in membership revenue.
In stark contrast, specialized cycling boutiques are growing fast. They earn more than twice as much per customer, attract thousands of attendees a week and are some of the most lucrative spaces in the industry. They generate excellent return on their real estate and capital investment.
Clients of boutiques spent between $80 and $117 monthly in 2014, while traditional health club members spent $37 to $761. According to the 2015 IHRSA & ClubIntel Report2, 42% of US club members are now using boutiques — that is twice the number of the 2014 report.
Despite their high cost, boutiques with a single activity are now the second most popular venue for fitness. People are moving away from traditional clubs, which are losing their market share quickly3.
How do you turn this threat into an opportunity?
You can win the game with a strategic approach:
- Refocus your efforts in underperforming studios to get better performance from your facility.
- Step up your game in execution. Boutiques are winning because of the mediocrity in club. Marketing, programming and the whole fitness experience needs to be superior for consumers.
- Provide a high-quality mass market cycle experience — create a cycling club within your club.
- Mix a great cycle offering with other high quality programs to add more value to your membership and create a much broader market appeal — i.e. top trends such as strength, HIIT, mind/body and core classes.
By building a cycling club within your club, you increase your chances of attracting the biggest generation yet: millennials. This market is swarming to boutiques and are the perfect target market for a club within your club. These young consumers are the future of your business.
Success doesn’t happen by accident. Achieving optimal performance will take dedication, time, resources and expertise. It’s time to shift gear, become more competitive and win back market share.
Les Mills delivers a variety of group fitness classes that provide cardiovascular, strength, and flexibility training for your members. Fresh class content is provided every three months to motivate and support engagement of both instructors and members which in turn reduces the attrition rate of your members. Our tried-and-tested group exercise classes deliver real physical results. Learn more about the tools and resources you need to improve your members’ experiences in their workouts, in the group studio and across the entire facility—all of which contribute to increased member engagement and retention. For more information, email business.insights@lesmills.com or call 844-LES-MILLS.
*Based upon a club with 3000 members increasing from 18 to 40 live classes a week and bringing class utilization up to 70%.
References:
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IHRSA & Wall Street Journal article: http://www.wsj.com/articles/the-500-a-month-workout-habit-1438019015
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2015 IHRSA & ClubIntel: International Fitness Industry Trend Report, “What’s All the Rage?”
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The Nielsen: Les Mills Global Consumer Fitness Survey (2013) questioned 4,600 adults over 18 who currently exercise, or have an interest in exercising, across 13 countries (including the United States, ten European countries, Brazil and Australia).
