Posted by Eamonn Curley on 31 January, 2019
The primary source of revenue for a fitness business is memberships. Tracking down leads, getting them in the door and giving them an engaged member experience that keeps them there is the bread and butter of running a successful fitness studio. There is no doubt about it, growing your membership base and your monthly recurring revenue is absolutely key to your survival as a business.
However, gyms and fitness studios can’t survive on revenue from memberships alone. The most successful fitness businesses diversify into different revenue streams alongside raising revenue through core memberships. Top fitness studios like F45, Soulcycle and Orangetheory are expanding beyond just offering fitness classes and have now developed into a one-stop shop for all things fitness related.
To increase profit margins for your business, you need to be creative and think of other ways you can provide service offerings of real value to both members and potential members. This additional revenue is typically called ancillary revenue.
This ancillary revenue gives you way more than just a boost to your profits. Some of the things that we will be discussing will help in boosting your marketing efforts. It will also make your fitness business an all-around centre for health and wellness rather than just a gym.
Athleisure and activewear have taken over the apparel industry in recent years, and the numbers don’t lie. It currently represents 24% of total industry sales, and this number is expected to grow in 2019. It is predicted that Athleisure will be an $83 billion market by 2020.
Looking around it's clear that wearing clothes suited for both casual and workout wear is becoming more popular. There's no better time than now to invest in branded apparel for your fitness business. People want to express the fact that they are into fitness and the best way to do that is through what they wear.
Sell this gear through your website and on-site in your gym if possible. You can then market it through your social media channels. Have your trainers wear gear during sessions is an easy way to market also. And while instantly Instagrammable activewear is on trend, it is essential to also sell practical gear such as sports bras, tactical tees, and towels.
Take a look at this great example from Glofox customer Synergy Fitness who sell apparel with their distinct branding that buyers can personalize themselves. The knock on effect of this is that the wearers become walking billboards for your gym.
Who needs Facebook Ads if you have that!
As we have seen with Athleisure wear, fitness is becoming a huge part of our everyday lives. Employers are investing in the health and wellness of their employees to increase their general well being and their productivity.
Companies are now either partnering up with a local studio that will run classes exclusively for their employees or building fitness studios within their office space. In the US, a chain of fitness studios called Life Time has gone a step further by bringing the office into the studio by offering WeWork style workspaces and conference facilities.
Listed as one of our significant fitness trends for 2019 fitness in the workplace will definitely be popular in the coming year. For your fitness business, it is a prime opportunity for you to add a valuable revenue stream. You don’t have to be based in a dense business area of a major city either. Even if you are in a smaller urban area, you should reach out to local businesses to see if they are interested in offering fitness classes to their employees.
There are two main ways you can do this. The first way is to send out one of your coaches to run classes on-site. The second way is to host classes in your studio for employees. This is is especially beneficial for generating revenue between 9am and 5pm which is typically seen as a slack time for a fitness business.
As with any of the other revenue streams we have discussed, there is also the added benefit of an excellent marketing opportunity. Think of it this way - by running corporate classes you are giving the companies employees a taste of what your fitness business is like. This gives you the opportunity to convert these attendees into full-time members outside these corporate classes.
Supplements are another area you can make a killing in. Dedicated sports and fitness supplement stores are popping up everywhere as people are looking to fuel their workout the best way they can.
Set up a small section in the reception area of your gym, so your members don’t have to waste time going to a specialized store to pick up what they need. As with fitness apparel, you can sell these products through your website.
If you find success in this then maybe think of using a white label supplement company that will put your branding on the bottle. It makes sense to promote own brand products that can help improve the health and wellbeing of your members and in turn building their trust in you.
Events are a great way to add a revenue stream early on in your fitness business. Don’t think that you have to put on something large and extravagant for the first event. Focus on smaller events that give value to the attendees. The benefit of putting on events is that gets you and your members out of the class space and allows for a more relaxed environment where you can get to know them better.
Definitely open these events up to the general public. Not only are you getting in extra revenue from ticket sales, but you introduce new people to your fitness business outside of the intimidating studio environment.
Your members are coming to your gym to get fit so as you know a large part of that is nutrition. When you are selling a person a membership, you should always be thinking, “How can I upsell this?” By offering them precise nutrition plans they can follow you are instantly adding more value to the member experience.
Look into using the services of a freelance nutritionist. This will put real weight behind the plans that you are selling, and your members will be more likely to buy them. They will also value the convenience of having this done for them in their fitness studio. Members that need the extra help when it comes to nutrition may look elsewhere. With your fitness business, your mission should be to provide an all-around health and fitness experience.
Other Revenue Streams
We have gone through some of the main streams you can use to increase revenue for your fitness business. However, there are plenty of others ways to help with this. One way is to run personal training on the side by either paying an hourly rate to the personal trainer and collect the revenue from the client or by renting part of your studio space to the personal trainer directly.
Another area you should be focusing on when it comes to products is smaller items that help enhance your members’ experience when they are in your facility. These can be things like headphones, water bottles, batteries, and locks to keep valuables safe.
Finally a method that has become extremely popular in recent years is online coaching. Good quality cameras have become less expensive so workouts and tutorials can easily be recorded and uploaded. By running online coaching, you can reach a new audience and generate revenue outside your local area.
Topics: Business Management