/ fitnessbusiness

Covid-19 hasn't killed the fitness business model

One of the biggest questions in the fitness industry in 2020 has been whether Covid-19 will kill the business model that multi-location and single location health clubs, gyms, and personal training studios have used for the last 40 years. Despite this being the hardest year our industry will ever face I am still extremely bullish on the general fitness business model for clubs, gyms, and studios. With vaccines being deployed by the millions in 2021 and members returning to train in-person it’s very possible that at the 30,000 foot view the industry will more or less look the same in 2022. It is important to note that I do write this with full acknowledgement and a ton of sadness that there has been a massive amount of turnover in our industry this year. However when we look forward we know that fitness consumers WILL want to return to their fitness center to train in-person, utilize the variety of fitness equipment and training service options, and socialize with their community. The experience and value provided by fitness businesses is nearly impossible to replace. We all need a third place outside of our home and work environments and clubs, gyms, and studios are a perfect fit to fill that gap.

It is worth acknowledging that 2020 has forced fitness businesses to evolve quickly to the new fitness industry landscape. With the huge leap in adoption in fitness products and services over the last nine months there clearly is, and will continue to be, more competition for fitness consumers' attention than ever before. I believe that the most important outcome of this increase in competition is that fitness businesses are going to lose a customer segment they’ve enjoyed for years - the members that pay for a monthly membership and almost never come in. The fitness consumers that everyone was able to just sign up and cash the check each month without too much work every single month will be gone forever. When you break that down it means that fitness businesses are going to have less customers than they did before. This means that to reach the revenue numbers they had before fitness businesses will have to figure out how to increase their revenue per customer.

With this metric in mind, what should fitness business owners be focusing on entering 2021? In the conversation that we’re having with our customers at StrengthPortal we’re focusing on two specific strategies to improve revenue per customer:

  • Add new, scalable training services options to your current service offerings
  • Increase member conversion to training services with a high profit margin

Here’s a list of training services that we’ve seen that our customers will be providing in 2021. I’ve highlighted in bold the training services that are generally seen as the most scalable and highest margin:

  • In-person 1on1 private personal training
  • In-person semi-private personal training (2-5 clients)
  • Hybrid personal training (in-person and online combined)
  • Online personal training (pure online, selling personalized programs)
  • Virtual 1on1 personal training
  • Virtual semi-private training (2-5 clients)
  • Virtual group training
  • In-person group training

When I talk to our customers who are looking for a solution to reach that next level of growth the easiest path is usually through adding one of the scalable training services listed above. Heading into 2021, where we are all going to have to figure out how to make more from less, we think the most important question you can ask yourself is whether you can easily add any of these training services to strengthen your fitness business? In 2021 our team at StrengthPortal is going to continue to focus on optimizing our personal training software platform to make it incredibly easy for fitness businesses to manage and scale these training services. Despite everything 2020 has thrown at us we continue to believe in the business model that fitness businesses have used to get to where they are today. We also believe with a few slight tweaks you’ll be able to position yourselves to continue to strengthen and grow your business for years to come. Keep up the great work, we couldn’t be more excited to continue this journey with you. - Matt

Matt McGunagle

Matt McGunagle

CEO & Founder of StrengthPortal. Working hard to help you in between deadlifts and jiu-jitsu!

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