Industry Trends

16 Bold Fitness Industry Predictions for 2016

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Several years ago one of our industry magazines asked me for my prognostications for the upcoming year. Hesitantly, I offered some. Fortunately or unfortunately, better than 3/4 of them turned out to actually take place. So, at the ever-present risk of egg on my face, here goes!

1. A major player in our industry (with well over 100 clubs) will disappear.

This player will be bought out, absorbed in bankruptcy by another company, parcel out its club locations or entirely shut down.

2. 2016 will be the year of the mini-club.

5,000 to 9,000 sqaure feet players will abound. Niche facilities do very well.

3. Mid-size, mid-price independent clubs will feel more effect of competition from "bigs."

Corporately-owned clubs, franchisees will take more market share of memberships, even in smaller-population areas (30,000-40,000 persons).

4. A major HVLP (high volume, low price) club company will begin to add "express clubs" to franchise offerings.

Could be in population areas as little as 25,000 persons.

5. The "HVLP Wars" will begin in earnest.

Expect 3, 4, 5 or more budget-pricers in concentrated higher-population markets, vying with each other and pirating weak mid-price clubs' members.

6. A major GEX-program-licensing company will shift gears.

Look for a significant change in marketing and delivery of pre-choreographed group exercise programming.

7. Small Group Training will finally take hold in clubs.

1-2-1 PT reaches too small an audience. Margins for clubs on individual PT are dropping, as there is too much studio competition. Most trainers are too limited in scope, so GEX instructors will become the go-to SGT trainers. The social aspect of SGT is good for members.

8. Larger independent clubs will "studio-ize" in attempts to compete with niche facilities.

Holding on to existing members who are straying will be a major effort for athletic clubs and not-for-profit facilities.

9. Aquatics in larger clubs will be re-born.

Look for many clubs to shift gears and charge for aquatics classes. The aquatics leaders? Not-for-profits.

10. Clubs of every size and type will try to grow Ancillary Revenues beyond 30% of Total Revenues.

Ancillary Revenues to Total Revenues (AR2TR) are the only money-maker now in most clubs. Some clubs are already approaching 50% AR2TR, stabilizing profits with less total members.

11. Clubs will cease fighting with Class Pass and other disruptive innovations.

They will instead accept these offerings and try to capitalize on the fall-out from them. Clubs will stop being chintzy with guest passes.

12. Clubs across-the-board will attempt to cut payroll expenses and eliminate "fluff" from budgets.

Full-time staff will take on more responsibilities and have greater accountabilities. Salaries may be tied to production and/or net sales.

13. Sales structures, commissions and ways of conducting sales will alter drastically.

For the most part, the "old ways" of doing sales are history. We could begin to see emergence of effective regional club-membership brokers.

14. Less equipment dependence in clubs aside from HVLPs.

Equipment manufacturers will be hard-pressed for new sales from other than national accounts.

15. Clubs will accelerate integration with technological tools.

Digital training for members, branded club apps, open-source technologically-integrated exercise equipment, exerciser-feedback systems, outsourced online weight management programs, digital payment for memberships and services and much more.

16. The "wellness movement" will stall.

Everyone is waiting to see the presidential election results and where the Affordable Care Act goes. Also, clubs are not ready to full embrace this movement as they lack sufficient data aggregation.


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