We talk about ‘digital transformation’ of the fitness industry – but what happens if it doesn’t transform?
Having recently watched a fascinating video by Jack Delosa, in it, he stated that Amazon didn’t kill retail – poor customer service did. Netflix didn’t kill Blockbuster – slow delivery and high customer effort did. And Uber didn’t kill taxis – waiting times and poor customer service did.
Technology, he explained, is not the disruptor in itself, but rather the vehicle through which we can do one thing: enhance the customer experience.
This absolutely echoes what we’ve been saying for a long time now: technology is not the strategy in itself, but the tool through which you can future-proof your health club business by making it more customer-centric.
Without wanting to sound like doom and gloom merchants, we thought it might help bring this to life if we shared three things we see happening to the health club industry if it doesn’t digitally transform.
#1 – The product will become too hard to consume
As customer effort goes up, customer loyalty goes down – and that opens the gates to competition coming in to undermine you.
In this digital age, we all have to make it absolutely frictionless to consume our product. In a gym context, that can mean anything from online joining to promoting last-minute PT availability through your app to enabling RFID payments on vending machines.
It can also mean making your club’s expertise and programming available to members when they’re away from the club, via an app for example, for those days when they can’t make it in for a workout.
Fail to do this and customers will seek easy-access alternatives that deliver what they want – fitness programming and advice – without any of the barriers they currently associate with gyms.
#2 – The product will be viewed as impersonal
Consumer demand for personalisation is growing: we expect tailored offers from retailers, we expect airlines to remember our preferences, we expect recommendations based on our previous behaviours.
And the fitness industry isn’t immune to this: we increasingly expect our programmes to be bespoke to us, reflecting our goals, our preferences, our interests, our progress to date. The challenge for many gym operators is this: the technology brands are responding, and they’re getting there faster than the health club brands.
Health clubs therefore need to take a big step forward, and that means embracing data. Put simply, the more data we collect – the more we know about our member – the more we can personalise and add value in an affordable way, having insight-based AI ‘conversations’ that will deepen their relationship with our brands and our products both inside and outside the gym, as well as driving significant upsell opportunities.
And the key to gathering data to enable this sort of initiative? Technology, and especially members’ round-the-clock mobile phone usage.
People often say tech is impersonal, but when used properly that’s far from true: it’s the primary facilitator of personalisation. Ignoring tech is the thing that will render your product impersonal.
#3 – Gyms will be undermined by businesses with better margins
Just as the low-cost clubs challenged and ultimately undermined the mid-market, so other competitors – quite probably not even health clubs – will continue to emerge, offering just enough value and service to exercisers at a price point they like, all enabled by technology.
Let’s go back to the previous two points to remind ourselves what tech can help us deliver: a frictionless, easy-access, personalised product. Ultimately, if a customer looks at your gym but perceives there to be a better, more responsive product on the market – at a lower cost thanks to its use of tech – which do you think they’ll choose?
In the end, a tech-enabled business will be able to deliver higher service levels at better margins. Fail to embrace this opportunity and your business is at risk of being swallowed up by those who have.
Ultimately, technology holds huge potential to strengthen and grow your business – but unharnessed, it will become your competition.
Importantly, though, this won’t happen because technology is there champing at the bit to steal your customers. It will happen because you’ve failed to seize the opportunities to focus on the customer and address their changing needs.
All of which might seem daunting, but remember, you don’t have to immediately go to market with a product as powerful as Netflix or Amazon’s. The important thing is to make a start – and there are providers out there, like Wexer, who can help.
Please get in touch if you’d like to discuss this further: info@wexer.com