On November 30, 2018, a 7.1 magnitude earthquake struck near Anchorage, Alaska. According to the Anchorage Daily News, it was the most significant earthquake to hit the city in nearly 54 years, resulting in a number of issues including power outages, traffic jams, communication struggles, and worries of a potential tsunami and gas leaks.
The Alaska Club, which boasts 14 locations statewide — the bulk of which reside in Anchorage — felt the impact firsthand. At some of its clubs, ceiling tiles fell down and pipes burst, among other damages.
According to Robert Brewster, the CEO and president of The Alaska Club, the response from staff was swift.
“The earthquake happened early in the morning,” recalled Brewster. “Most of the town shut down, as people were dealing with problems they had at home. However, within an hour’s time, all of our staff descended on these clubs to start cleaning up and get them back online as quickly as we could. Not just the club managers, but all of the entry-level staff, fitness personnel and senior management team. I remember at the time thinking that was a good definition of an ownership mentality — something I’m not sure occurs everywhere.”
That ownership mentality is present in each of The Alaska Club’s 995 employees — making its people one of its biggest assets. This fact wasn’t overlooked by Brent Knudsen, the founder and managing partner of Partnership Capital Growth (PCG), a private equity firm that purchased the fitness brand around six years ago.
“It’s all about the people,” said Knudsen. “The team is passionate and committed to doing the right things for the members.”
This stems from The Alaska Club’s commitment to excellence, a fact that’s reinforced with employees from Day One, and carried out through its brand vision to deliver a rewarding experience to inspire members toward ongoing fitness. Each subsequent brand value is in support of this vision, including “Raise the Bar” and “Deliver Results,” for example.
In fact, according to Debbie Cedeno, the senior vice president of sales and marketing at The Alaska Club, “Living Our Brand” is a motto that’s stressed to all staff, encouraging them to live and breathe the brand vision and values in every aspect of their roles.
“In all of our departments, when we onboard a new person, we talk to them about the brand values, and we talk to them about what on-brand behavior looks like and what off-brand behavior looks like,” said Cedeno. “When we say we’re results-driven, for example, we want to know the people we’re hiring understand what that means. So if I’m a personal trainer, and I’m not sitting down and asking members what their goals are and we’re not measuring how they’re doing, then they’re not really living the brand.”
The Alaska Club’s commitment to excellence is also conveyed through annual capital improvements. According to Brewster, the original founders of the brand strongly believed in having and keeping beautiful facilities with state-of-the-art equipment.
“We continue their vision by annually planning and budgeting for capital improvements,” continued Brewster. “We aligned ourselves with the right partners. Our private equity group, PCG, has carried on our tradition by continually reinvesting capital funds to ensure we are changing with the landscape.”
In light of increasing competition from all ends of the marketplace, Brewster said it’s more important than ever for mid-tier and premium clubs to ensure their facilities are up-to-date and providing a competitive offering.
“It’s very easy for club operators to get in a mode where they’re thinking, ‘That bike still works or that bench over there works as well as the day I put it in,’” said Brewster. “It is probably one of the fundamental mistakes that particularly independent operators make — they don’t appreciate the importance of staying fresh. I think this is a major problem in the mid-price market and the reason why low-cost operators were so successful, because there was no discernible differentiation. In fact in many cases, the low-price operator came in with a better facility in addition to a lower price.”
Continually investing in its facilities ensures members are not only drawn to The Alaska Club over the competition but stay for the long-term. “We have to continually refresh the members’ mindset, as well as refreshing the quality of the equipment,” said Brewster.
Outside of capital improvements, The Alaska Club’s team is always reexamining and asking, “How can we get better?” to further emphasize its commitment to excellence.
“Inspecting is part of the company culture,” said Brewster. “We inspect everything. Our partners, PCG, embrace and support our desire to always improve. Our quarterly meetings are dedicated to evaluating performance and working together to strategize how to improve.”
Data is a key factor in this process, with The Alaska Club taking a data-driven approach to all important decisions and in the evaluation of success. “We measure everything,” said Cedeno. “We’re looking for trends to see if there’s something that we have to make a change to, and also to see where there’s an opportunity.”
This is where technology comes into play, with The Alaska Club investing in tools such as CSI/Daxko, HubSpot, Medallia and OASIS — ensuring it has the reports and info needed to make quantitative, informed decisions.
Take HubSpot, for example, a tool that’s used to measure the effectiveness of The Alaska Club’s marketing campaigns.
“So many things have gone digital and so we’re really monitoring how effective our ads are,” explained Cedeno. “We’re trying to identify who our target audiences are and what message they need to hear. That’s what we’re using with new member acquisitions — that type of data.”
In addition, Medallia is helpful for evaluating brand perception and identifying problems before they become bigger issues.
“With Medallia we’ll pull a report and say, ‘These are all the people who said they’re not likely to be here in six months. Here are all of our cancellations,’” explained Cedeno. “We compare the two, we look at them and go, ‘Out of the people who said they weren’t going to be here, this is the percentage who aren’t here anymore. We’re going to focus on this group and see what we can do to turn this group around.’”
On the sales side, Oasis allows The Alaska Club to monitor incoming and outgoing calls to measure the effectiveness of both marketing campaigns and the consistency of its sales team.
“When we start the month out with a new promotion, I jump on the phones and I listen to every call that comes into the club for a full day,” said Cedeno. “What I’m looking for is one, what are people calling about? If we sent out a digital ad or commercial or direct mail, I want to hear what people are asking. What’s making them make the phone call? And then I want to make sure the staff is answering correctly, they’re adhering to our sales script, and they know how to leverage that particular promotion.”
According to Brewster, The Alaska Club’s data-driven approach and willingness to invest in technology gives it a key advantage over competition.
“One of the things I think is problematic in our industry is we tend to treat our membership as kind of a homogeneous blob, and we work a lot with averages, such as the average length of membership,” said Brewster. “But if you rely on averages, you’re not going to have a really good idea of how to address or improve your business at various levels. So we try to use data to drill down and understand the various trends that are happening within the data — not to only depend on averages to adequately make management decisions.”
A final key to The Alaska Club’s commitment to excellence involves looking ahead to ensure the brand is innovative and ahead of the curve.
For example, in line with the industry trend toward medical fitness integration, The Alaska Club recently launched P.R.E.P. — an exercise program for people who are referred into the program by local physicians — in cooperation with ACAC in Virginia.
“We generate those referrals from doctors by the use of full-time outreach sales coordinators and service them with a team that includes a registered nurse,” explained Brewster. “It is a low-cost, prescription-based program that’s main purpose is to introduce a segment of the market that would not normally come to the club.”
To date, P.R.E.P. has drawn in pre- and post-rehab patients, people with chronic diseases such as diabetes, and people in the general population who just need to initiate activity in their lives — segments which were more difficult to reach prior to the program.
“We are hoping to establish this as a solid profit center, but also to expand the market as competitive conditions get more saturated,” continued Brewster. “As far as trends go, high-end clubs will have to move in this direction to generate growth in the future.”
Ultimately, The Alaska Club’s commitment to excellence has created an inspiring and motivating environment that’s difficult to beat.
“We’re always aiming to be the best — whether it’s the best community partners, whether it’s the best employer, whether it’s the best health and wellness provider,” said Cedeno. “That goes from what the clubs look like, how clean they are, to the staff — and I’m super proud to work for an organization that wants to be the best.”
