With increasing success, players such as Urban Sports Club, Gympass, Hansefit, Gympool or qualitrain are starting to shake up the classic business model of fitness studios. The principle of these mediation platforms - often referred to as aggregators - is initially quite simple and extremely attractive: instead of a gym membership, users purchase a membership with the platform itself and can train at any of the platform's partner studios. The offers are being used more and more - no wonder, because the systems of the usually extremely well-funded aggregators offer members benefits that individual studios cannot offer. Find out here whether the hot platforms are more of a curse or a blessing for studio operators.
The market potential of the fitness industry
Back in 2015, a representative end-user survey conducted by industry giants such as DIFG, FIBO, BVGSD, DFAV e.V and INLINE Unternehmsberatung showed that the industry is reaching the limits of its growth due to the system of membership contracts with annual commitment. Although the system has clear advantages - the economic plannability through which attractive financing models can be developed - it has a negative effect on the development potential. Winning new customers in the fitness industry is difficult; the studio has to offer very special advantages or be particularly inexpensive in order to be attractive to new members.
How can I improve member loyalty to my fitness studio?
Especially in our fast-moving times, the thought of committing to a single gym for a long time is initially daunting for many. Large chains such as McFit already offer members the advantage of being able to train in any of the chain's studios. This is ideal for all those who travel frequently within Germany, as training is also possible without any problems on any business trip. But even with large chains, the model reaches its limits.
This is where the aggregators come in: they offer their members exclusive benefits, flexibility in choosing the hottest training locations, short-term contractual commitments and quite often also subsidisation of the costs by the employer. At the same time, the conventional systems remain in place: Any studio that becomes a partner with one of the referral platforms naturally retains its own members and taps into a large amount of potential new customers. A referral fee to the aggregator is only due if the trainee actively uses the offer.
Advantages and disadvantages of the aggregator concept
Of course, this concept is not new: in the travel industry, in air travel or in passenger transport, intermediary services have been used for a long time. Booking the next holiday trip conveniently via a portal has so many advantages that direct bookings in hotels have become rather rare. The success of all these mediation models is, of course, double-edged: On the one hand, the market is normally growing, but the margins of the individual provider are decreasing. As a studio operator, you have to do an intensive cost-benefit analysis here. By partnering with a mediation platform, many more people can of course be addressed, but the profit is significantly lower than with a completely conventional member with an annual contract.
At the same time, a cooperation presents the studio operator with new challenges: He only makes a profit if his studio is actively used by members of the platform. This means that their own studio must be as attractive as possible in order to attract as many exercisers as possible. The development of new concepts and strategies is called for here - no small task in the constantly pulsating fitness world!
As the proportion of platform members in the population grows, the issues raised by the system become more serious. Today, platform members are more likely to be seen as additional revenue for a gym - but what happens when the majority of members are recruited from platforms and traditional annual memberships make up less and less of a gym's revenue? What is clear is that aggregators have already proven their market power and effectiveness. It makes sense, then, that every studio owner should already be looking at strategies for dealing with this growing sector.
Conclusion
Mediation platforms such as Urban Sports Club, Gympool or qualitrain are taking an increasingly strong position in the fitness world. Clever cooperations can represent an opportunity for studio operators in the growing fitness market , but there are still risks involved in the thoroughly sensible business model that every entrepreneur should weigh up for themselves. What is clear is that aggregators will continue to bring a different wind to the fitness industry in the future - so it is the perfect time to develop your own strategies for dealing with them and to cleverly use the opportunity offered by mediation platforms for your own studio.
Editors fitnessmarkt.de (DG)
Photo credit: #168609753-Natee-Meepian-AdobeStock
Published on: 25 September 2019