Reset & Revitalize: Lessons Learned from COVID-19
The COVID-19 pandemic has had a profound and unique impact on the global fitness industry.
In many ways, this impact is hard to quantify, as the long-term consequences are yet to be felt, and are certain to be varied and far-reaching. But in the short-term view, the pandemic led to the mandated closure of thousands of gyms worldwide — starting in March in the U.S. — forcing operators to navigate unforeseen circumstances and never-before-seen upheaval.
Despite the unprecedented challenges, health club operators globally and nationwide showcased their abilities to quickly pivot, innovate and rally, coming together as an industry to share best practices and develop unique solutions to serve their communities.
A “new normal” in how clubs will operate moving forward has arisen that stresses the need for more robust virtual programming, importance of cleaning and sanitizing as a core competency, and necessity for empathetic leadership.
In addition, the crisis posed the question of whether or not clubs should be considered essential businesses, leading to a call-to-action for more vocal global leadership in the fitness industry as a whole.
What the Crisis Revealed
Prior to the coronavirus pandemic, many clubs had begun to test the viability of virtual fitness. A select few had robust mobile apps with on-demand libraries of virtual workouts, while others had implemented virtual one-on-one coaching. But for many operators, virtual offerings were limited — if they existed at all — and viewed more as add-ons than profit-generating extensions of the business.
“The vast majority of clubs in the industry were dipping their toes in the water, so to speak, as far as offering online classes and resources for members to exercise at home or that complemented the in-club experience,” said Brent Darden, the chair of REX Roundtables and founder of Brent Darden Consulting. “They were looking for solutions for members who were not able to get to the club because of work commitments or who were out of town on vacation. So clubs were experimenting or thinking, ‘We need to really move more toward that,’ and this was accelerated tremendously during the shutdown with it becoming a necessity.”
Upon learning they would need to temporarily close their doors to the public, many club operators quickly pivoted in a matter of days or weeks, creating social media groups, offering live workouts through Zoom, bringing nutritional programming online and more, to ensure members had access to vital health and wellness services from home.
According to Paula Neubert, the general manager and president of Club Greenwood in Colorado, the launch of more robust virtual offerings is something her club, and the industry as a whole, can positively benefit from moving forward.
“Prior to the pandemic, when a member would move to Arizona from Colorado, or they were snowbirds and went to Florida for five months out of the year, we lost touch with them unless they came back,” said Neubert. “Now, they could actually continue to do online training and stay connected with us in different ways. From this, we’re going to create an online membership and we will have live-streamed classes continually. We’re redoing some of our studios so they can always be live-streamed. There are a lot of opportunities we have to change our business model and plan going forward. It’s expanded our horizons.”
Adam Zeitsiff, the CEO of Gold’s Gym, echoed those sentiments. “We realized our vulnerability as an industry,” he said. “That vulnerability is when those brick and mortar doors shut, so does the business revenue. It’s exposed our biggest weakness, and that’s leading to what you’re seeing in the virtual realm.”
For JoAnna Masloski, the COO of Wellbridge, which boasts 19 owned and managed clubs nationwide, the pandemic has brought to light how quickly the fitness industry can evolve when called upon.
“No. 1, we reminded ourselves how quickly we can pivot and I think the biggest thing we need to recognize as an industry is we need to pivot quickly while our clubs are open,” said Masloski. “We can do this faster than what we think or plan for. I’m just impressed by how quickly we have been able to figure out solutions and make decisions to change, and then actually change.”
The New Landscape
As clubs across the U.S. continue to open in key states, they will do so under a “new normal” that involves robust cleaning and sanitizing measures, social distancing guidelines and, very likely, limits on usage.
According to Blair McHaney, the CEO of MXM and owner of WORX gyms in Wenatchee, Washington, it is vital for cleaning and sanitizing to be a core competency for health clubs, and one that’s communicated frequently and effectively to the membership.
“One of the biggest things coming out of this is going to be your cleaning and sanitizing practices, which should become a core competency,” said McHaney. “You should even brand them something. Your cleaning and sanitizing are sort of the new value-added programming. For it to be of value, you have to make it visible somehow and be able to explain it.”
Along those lines, McHaney said there are five important aspects surrounding cleaning and sanitizing for clubs to consider post-COVID.
First, members need to see other members cleaning the equipment they use, and following new member rules and guidelines regarding sanitizing and social distancing. “Every member has to become an extension of your housekeeping,” said McHaney. “They all have to do their part in cleaning the equipment they use.”
Second, staff need to have a strategy for enforcing these rules in a way that’s empathetic and effective. “Staff have to make sure there’s compliance, because it sends a strong signal when you go over and kindly say to somebody, ‘We have new house rules, and we need everybody to do it,’” explained McHaney. “In addition, this keeps members from policing each other. Ideally, you don’t want that happening.”
Third, clubs need to ensure cleaning and sanitizing products are plentiful and strategically placed club-wide. “Whatever the tools are, they have to be everywhere and you can’t let them go empty,” said McHaney. “You have to have a way to monitor and make sure those tools are always there, always on.”
Fourth, hand sanitizing in particular has to be super easy for people to do frequently.
Fifth, gyms need to develop a strategy for communicating, showcasing and marketing their new cleaning and sanitizing practices, and ways they’re striving to keep both members and staff safe.
“The member needs to see you’re doing something different after the shutdown and ongoing [more] than you did before the shutdown,” said McHaney. “They’re expecting to see an improvement there. They’re not going to be able to see all the improvements — like ultraviolet in the ductwork or fogging that happens after hours. But you should make sure they see it through videos and messaging. Those best practices have to be well communicated.”
In addition, as the situation surrounding the coronavirus is ongoing and ever-evolving, McHaney stressed the importance of gathering the “voice of member” through surveys to ensure a real-time view of member sentiments.
“Some of the most important data you can have is that ‘voice of member,’ and it’s your leading indicator,” said McHaney. “Financial is a lagging indicator. Reviews are lagging indicators. You need to have a real-time ‘voice of member’ happening and have it happening all the time, because the environment is dynamic.”
Neubert echoed these sentiments, stating Club Greenwood’s “voice of member” technology, Medallia, was key in helping them predict how members would respond to being asked to stay on billing for the month of April. The vast majority of members agreed to do so, allowing the club to retain all 240 of its employees.
“We have been doing the Medallia survey since 2013, so we have years and years of data and information to put us in a position for something like this,” said Neubert. “We knew going into the crisis, because of the survey, we were in a position where our membership trusted us and were very loyal and dedicated.”
Beyond cleaning and sanitizing protocols, and maintaining a strong pulse on the attitudes of customers, what else should operators be considering in this new environment?
According to Bill Davis, the CEO of ABC Financial, maintaining a member-centric approach throughout the crisis and beyond is vital. “I firmly believe those who embrace a member-centric mindset will weather this period of uncertainty better than those who do not,” he said.
Take billing, for example — Davis advised operators to be thoughtful and empathetic surrounding billing strategies and rules regarding freezing accounts or cancelations.
“It starts with how effective you are being in your communication strategy to your members, in terms of frequency, but also clarity and accessibility,” said Davis. “Recognize your members have gone through an experience that could have involved the loss of their job, someone they know contracting the COVID-19 virus, or maybe they are experiencing some degree of social distancing anxiety. Meeting your members where they’re at and really nurturing that relationship will pay dividends in the long-term.”
Davis added these considerations should apply to your employees as well. “I encourage club operators to be equally sensitive to some of the considerations I just outlined to their employees as well,” he said. “We are witnessing there’s some level of trepidation or concern at the employee level around their safety and willingness to come back to work. I’m advocating a member-centric approach, while at the same time advocating an employee-centric mindset as well.”
Call to Action
As the coronavirus pandemic continues to impact the fitness industry on a global scale, operators of all sizes and modalities are joining together in an effort to position gyms as businesses that are essential to the overall health and wellness of their communities.
“I think the world really sees now that fitness is not about just having a nicely shaped bicep or muscular leg, but it’s about what’s on the inside,” said Zeitsiff. “It’s what we’ve known in the industry forever. It’s what the health insurance providers have known for the last five or six years, which is why preventative care has become so prevalent. I think the rest of the world is finally realizing fitness is more than just looking buff — it actually will help your immune system, it will help you fight off disease, and if you get sick, it will help you get better quicker. So I think that’s been a huge positive.”
Masloski agreed, stating clubs need to double down on the essential aspects of the gym business within their local communities and on a larger scale.
“We need to vocalize more,” said Masloski. “We’re a smaller industry, but our energy and passion are so much larger than so many of these other industries. So if we can just bottle a little bit of that up and focus it in the right funnels, I think we can, as an industry, absolutely come out of this stronger.”
This rallying cry has already been showcased over the past few months, as club operators and vendors of all types have sat on virtual roundtables together, hosted weekly calls and given advice freely.
“A somewhat surprising, but positive, impact has been the collaboration among everyone in the industry,” said Kent Stevens, the executive vice president of commercial sales at Matrix Fitness. “Clubs and vendors who were formerly competitors are working together to help pull everyone through the crisis.”
Ultimately, despite the unforeseen challenges, many club operators and vendors feel the coronavirus pandemic is something the industry can rebound from, similar to past crises.
“After 9/11, there was talk that no one would get on an airplane again, and obviously as time goes by, people get back to normal lifestyles,” said Mike Alpert, the president of The Claremont Club. “I think people are certainly going to be more cautious about washing their hands periodically during the day, and they’re going to be more focused on sanitizing, disinfecting and cleanliness, but I think people are still going to hug each other. I think they’re still going to shake hands. I think they’re going to eat dinner together and they’re not going to worry if they’re three feet from each other or six feet from each other. I think in time this is going to dissipate and get back to more of what we consider to be normal.”
Here, Bill McBride, the co-founder, president and CEO of Active Wellness, identifies several “Mega-Trends” that will be at play in the fitness industry for the foreseeable future as a result of the coronavirus:
- People, at least in the short term, will have a fear of infection and of other people. Social beings who want to be around others are going to be afraid to be around others. This is a unique psychological paradigm. Some may be righteous about other’s behavior and some may be far too laid back. This has the potential to change human behavior with regard to interactions with each other, consumer participation and spending with businesses.
- Tele-health will be more prolific.
- Virtual programming will be more widespread and improved in quality. Local site-delivered live streaming will take on a new dynamic, versus generic or unknown content.
- Remote working will be more acceptable, possibly changing the usage in club attendance and club usage behavior.
- Trust and credibility will be a differentiator for clubs. Local may have an advantage over national brands.
- Cleanliness, hygiene, sanitation and disinfection will become a competitive necessity and potential advantage.
- There will be contraction in the health club, restaurant and retail spaces. This could be an opportunity for top operators.
- Health and well-being will be more important than ever.
- Prevention will become more important than ever in staying healthy and protecting one’s immune system.
- Self-care will take on a much broader role.
- Some members will not return until there is a vaccination or, at a minimum, foolproof treatments.
- Social interactions will still be vitally important but may be redefined in the near term.