Today the most competitive health club business models and brands understand that they are operating in a digitally driven world made up of consumers who now have more choices and options regarding how they achieve their fitness, health, and wellbeing. They also know those customers are spending more and more time on digital channels.
Digital has been increasingly impacting the health club and gym industry amid a growing marketplace, more people are visiting gyms and health clubs than ever before. This means it’s more important than ever for health clubs to market their services better and they need to take advantage of the data that they have access to in order to do it.
The team at ABC Financial has been sharing content related to these and other health club industry trends for some time, addressing a lot of subjects including:
- Why delivering personalized experiences is key for health clubs;
- The importance of health club operators having the right technology partner;
- How to win over the modern fitness consumer of today;
- The need to create frictionless fitness services;
- The massive growth in demand for services from health clubs including wellbeing and betterment programs and offerings; and
- Many other trends and subjects with some pretty smart fitness industry folks on our Fitness Industry Innovation Podcast (check it out here).
Considering all of these trends, the bottom line is that they are contributing to consumers becoming more interested in using fitness and wellness services. This is good news for brands and operators who embrace digital and have an understanding of how to take advantage of it strategically. Nowhere is this as important as when it comes to marketing and using data to do it well.
In January of this year, I wrote a post (here) that pointed out how being competitive in the health club industry today will increasingly come down to relying on data to understand members while creating great and relevant fitness experiences using that knowledge. Here is an excerpt:
“With so many fitness alternatives available for consumers today, the customer should be the focus as Paul Schaller shared in his recent post Why The Customer Always Matters Most. A lot of wisdom is shared here by Drucker, Porter, and Magretta as well. To break it down every business should i) understand who their customer is first, ii) how they make money, and iii) what value they deliver. Today more than ever these three dynamics, customer insights, data, and experiences, interconnect and are key to the success of the most competitive business models today in any industry, let alone in health clubs, fitness studios, and gyms. In the end, the most important thing about great business models is exactly what Paul shared (learn more about Osterwalder and his business model canvas here):
“Customers comprise the heart of any business model. Without customers, no company can survive for long” Alexander Osterwalder
As with a number of industries the health club, fitness studio and gym industry has seen a lot of growth in the past decade. IHRSA reports that from 2008 until 2017 the number of health club consumers has increased by 31.50%. That’s a lot of new members out there.
Given these statistics and thoughts it should not be surprising that as consumer interest in fitness surges, our industry has to become more digitally sophisticated out of necessity. For health club operators this is a big opportunity yet some still are not taking advantage of it.
With most consumers digitally connected on many different channels, clubs are now able to take new approaches with their marketing strategy. These new approaches enable more insightful efforts to engage with prospective and current clients, by collecting and using data. Exactly how can health clubs use data to reach new prospects? We have included a few suggestions as examples to get started. Of course, there are many more means of leveraging data than that are covered here. Some resources are included here to help point the way.
As with any type of marketing effort you first need to determine who your target market is and is not. The basics of marketing apply here as do these related questions: who is the audience you are targeting; where are they located and what message will you share with them?
Using Your Existing Member’s Household Data
One way to determine your target audience is by using your existing members household addresses. With this data, you can conduct an analysis with the help of companies like Claritas to breakdown your clients and members by various PRIZM categories. “PRIZM” stands for Potential Rating Index for Zip Marketers. PRIZM Premier classifies every U.S. household into one of 68 consumer segments based on the household’s purchasing preferences. PRIZM Premier offers a complete set of ancillary databases and links to third-party data, allowing marketers to use data outside of their own customer files to pinpoint products and services that their best customers are most likely to use, as well as locate their best customers on the ground. PRIZM Premier enables marketers to create a complete portrait of their customers for smarter targeting. PRIZM Premier is an update to the PRIZM model that featured 66 segments, and it includes new inputs for technology adoption and wealth. The data available simply via your members' home addresses will enable you to identify specific segments of your existing membership by PRIZM segmentation. It also can inform you about how many households existing by segment in your trade area. To learn more about PRIZM you can visit this website. To understand the various PRIZM segments you can check out these descriptions.
Not only will the segments be available using this data to tell you who your customers are; the reports provide maps so you can understand the specific trade area for your health club. The reports can also show you the number of households in each drive time radius that make up each segment. This is important information for you to understand how many additional customers are available by segment in your market. It also shows you exactly where they are. With respect to this analysis it is really important you are clear as to who your best long-term members are. If you target profiles that only remain members for a brief period of time and use fewer of your services then that will not be as effective as understanding who your most valuable members really are and targeting people like them. Here are four audiences your club might consider marketing to as an idea check it out.
You can also reference data from IHRSA. Each year IHRSA publishes a Health Club Consumer Report which includes lots of details about the types of customers who use health clubs, studios, and gyms. The report relies on survey data to guide club operators on how to better understand consumer behavior as well as leverage demographic trends in efforts to stand out from competitors. The 2018 IHRSA Health Club Consumer Report is organized into the following chapters:
Chapter 1. U.S. Health/Fitness Club Trends: An analysis of total membership and consumer growth trends;
Chapter 2. Membership Behavior & Industry Models: Insights on industry segmentation in response to trends in member behavior;
Chapter 3. Member Demographics and Implications for the Industry: An exploration of gender, household income, age, educational, and ethnicity, as well as how demographics are influencing the health club industry;
Chapter 4. Member Attendance & Tenure: Insights on membership tenure and attendance;
Chapter 5. Member Activity Behavior: An examination of consumer utilization of equipment and participation in group-based training formats;
Chapter 6. The Price-Value Paradox: An analysis of fees paid overall and per club segment;
Chapter 7. Personal & Small Group Training: An overview of private and small group training clients;
Between resources provided on your members through their addresses and industry data regarding consumers and related trends from IHRSA, you should have a good idea as to who you want to target with your marketing. However, there is even more data at your fingertips that can help.
Using Your Existing Member’s Email Data
In addition to your member’s home address data, emails for your members are extremely valuable when it comes to marketing using data. With this valuable information along with information from a source like Claritas PRIZM profiles, you can easily create “look alike” audiences in Facebook in the geography you have learned to target. Again, focus on your top 25% of members as an initial category. In addition, if you can segment those emails by interest, say a list of emails related to people who pay for personal training or attend group fitness classes, you can personalize the messaging to certain prospects even more. These buyer “personas” or groups who represent your key valuable member types are something every health club should understand because it will help determine who to put your attention on and how. If you want to understand how Facebook marketing can target specific prospects and existing members in various ways check this out.
Why Health Clubs Should Use Digital Marketing Channels
Advertising has moved to digital because of the value of data and the ability to target very specific segments in very specific geographies with targeted stories, messages, and offers. You might have heard some of the statistics:
- Facebook is the second most-used platform globally, followed by YouTube. (Pew Research Center, 2019)
- Around 43% of US adults get news from Facebook. (Pew Research Center, 2018)
- 1.56 billion active users log onto Facebook every day. (Zephoria, 2019)
- More than 500 million people use Instagram every day. (Oberlo, 2019)
- Seven out of ten hashtags on Instagram are branded. (Sprout Social, 2018)
- Instagram has over 1 billion active monthly users. (Oberlo, 2019)
- For even more reasons why you should leverage digital platforms in your health club marketing check this out.
If you’d like some more details on running Facebook ads check this out. Health clubs certainly should rely heavily on these digital channels in their marketing campaigns.
What Messaging Should Health Clubs Use In Their Marketing Based On The Data
Once a health club brand has identified who to target and how to reach those targets via digital platforms, content that resonates with these audiences is key. More and more today’s prospects want to understand the health club brand they are thinking of being a part of by learning from others that are like them and understanding their brand experiences through social channels. Digital word of mouth is key. Story-telling that relates to the buyer groups you have identified is really important. This includes video, visuals, and member recommendations and comments. For example, if you have a huge yoga following and great classes and those members are very valuable to you, all of the stories about how your members enjoy those experiences are very important and can be shared via digital platforms targeting those prospective members. Prospects want to see people like them who they can relate to in the content to make it personal and relevant.
In today’s world, it is wise to stick with an 80-20 rule on marketing with 20% being offers and 80% being stories and valuable information that informs prospects about your health club. If you would like some great ideas on how to create relevant content for your health club marketing check this out.
How Data Will Impact Health Club Marketing In The Future
Some basic ideas are shared here that any health club can rely on, but that is just the start. The more personalized and relevant you can share content that addresses very targeted markets, the more effective your marketing will become. The more health clubs use data to understand how to achieve this goal the better.
The more you can segment members understanding their unique needs and wants, the more you can offer valuable and relevant information and services. This is going to be increasingly important in the months and years ahead when it comes to marketing your health club business.
So what do you think about these ideas of using data to improve your health club marketing? I’d love to hear your views. Our partners and the team at ABC Financial are working very hard to help gyms and health clubs compete in the growing and changing the marketplace. Our list of preferred vendor partners includes trusted service providers with expertise in marketing, sales automation, and more. Contact us at ABC Financial if we can assist in enhancing your health club, gym, or fitness business with our technology solutions and insights.
Kelly Card is the Senior Vice President of Partner Relations at ABC Financial. Check out her Fitness Industry Innovation Podcast where she interviews leaders from across the health, fitness, and wellbeing landscape. Kelly serves on the Board of Directors of the Fitness Industry Technology Council and is the Co-Founder of Industry FIT. She has over twenty years of experience in health club, gym, and fitness operations and co-founded and was President of Club-Apps, which was acquired by Netpulse in 2014. You can reach her kelly.Card@abcfinancial.com and follow @theKellyCard on Facebook & Twitter. Connect with and follow @IndustryFit for the latest in fitness trends and technology as well.