Gym Chains Turning to Social Media and Mobile Search

As people join gyms as part of their New Year's resolutions, the fitness industry is itself turning over a new leaf. Digital already plays an important role in the way gyms acquire and retain members. This year could see them moving into mobile and, belatedly, social media as part of their marketing efforts.

This time two years ago LA Fitness became the first gym to offer online sign up. Now it gains around 25% of new members online and the facility is becoming common among its competitors. Search is a key weapon in the armoury of gym marketers, who have also developed sophisticated CRM techniques to keep members on board.

This year the major change that potential gym members will notice is mobile advertising. Fitness First is due to use the medium for the first time this month, while LA Fitness is repeating a mobile campaign it first ran last year. Fitness First trialled a six-week campaign last October/November to evaluate response to mobile advertising and is planning a similar campaign for January. The autumn trial was executed by MIG and sister agency 4th Screen, and was booked to ensure it reached people interested in sport.

"We worked with O2 and Virgin Mobile, mainly on their sports and some lifestyle pages," says 4th Screen MD Mark Slade. "With O2 there was the advantage of being able to use behavioural targeting to know which people were really into sport, so we could prioritise reaching them. We wanted to show Fitness First that mobile is at least as effective for reaching their audience as the web.

"We displayed an offer for a free one-day pass and then entry to a competition to win a year's membership. The response was really good. Once they got their pass, people just had to put in their contact details to find their local gym and we then took them to a WAP site for more."

While Fitness First marketing manager David Langridge won't be drawn on numbers, he says he's impressed by mobile's potential so far. "We've found mobile marketing is showing good signs of being a successful medium for generating leads. Being able to get people to our mobile site and collect their contact details is a great way for us to distribute one-day passes and, hopefully, get a lot of people to our gyms in January."

Not to be left behind, Mark Jenkins, marketing director of LA Fitness, says the gym chain is also due to roll out a mobile element to its poster campaign this month. The ads will feature a shortcode for people to text to receive a free one-day pass and then find their nearest LA Fitness gym.

Nuffield Health, which recently rebranded from Cannons, has mainly used mobile as a central information service. But Jodie Wickers, the chain's CRM manager, is hoping to build on this and give more mobile messaging power to each gym. "We're very cautious with how we use mobile because we don't want to be intrusive," she says. "So we've been very centralised and usually use mobile to let people know if the gym they're a member of has had a problem, such as the pool having to be closed. I'm looking to move this to more of a local level next year so that

individual gyms can segment their memberships into the classes and activities they're interested in, then give information about those areas and perhaps suggest additional activities those people might enjoy."

While Fitness First may be able to claim a first with itsautumn mobile ad campaign, LA Fitness is continuing to differentiate itself as the group that uses digital not just for marketing but also for ecommerce. Tony Pye, founder of Ink Creations, which built the online sign-up site for the gym chain, claims his client is still a leader. "JJB Fitness and Fitness First have followed suit but they're not as in your face about it," he says. "For LA Fitness the home page is all about offers, which change every month. It's not static information, it's a really active ecommerce site."

LA Fitness's Jenkins, whose decision it was to offer online sign-up, explains his move as a way of breaking free of the sector's focus on bricks and mortar, and also meeting customer demand for increased personalisation. "Gym websites have always been there to get you to go to the gym and get sold a 12-month subscription, whether it's what you want or not," he says. "They're too much about physical locations. We thought we'd get a headstart by selling centrally because people know what they're going to get at a gym, so why force them to turn up and be sold to when they might not want to? If they don't want a 12-month membership, why not offer web-exclusive deals, such as month-by-month packages, three-month deals or 12 months for the price of six, as we do? It's the area where we decided to stand out, and we still do."

Motivational techniques

Although there's still obviously a large seasonal push to get people through the door, gyms are also ramping up their CRM systems. Email is being used to offer exercise suggestions and even the help of a personal trainer to devise a fitness regime to remotivate flagging members (see box opposite). LA Fitness sends out regular emails based on information members have given about their fitness goals and where they are in relation to meeting them, as well as demographic and location details. There are about 600 permutations of every email, tailored to goals, location and motivation (Targeting; nma 14 February 2008).

According to Andree Dean, CEO of the Fitness Industry Association, such CRM initiatives have started to have a big impact on churn. "Gyms have got retention up to an industry average of around 70% through motivational emails and other initiatives," she says. "It used to be around 50%, which meant as many people were leaving as were signing up. Gyms have done a lot to identify people who might be thinking of leaving and trying to get them using the gym more regularly."

Gyms are also trying to be more flexible with their offers, such as with different payment schemes. But they also realise their online presence can do much to deepen members' sense of belonging. This is why David Lloyd recently overhauled its web presence (David Lloyd revamps site to retain members; nma 20 November 2008). The chain has around half a million members and devotes 15% of its budget to digital. It has beefed up the members' area to let members books sessions and courts, manage tournaments and find suitable sporting partners.

Head of digital marketing David Brosse says the changes were part of a shift from straight acquisition to retention. "There was significant room for improvement in serving our key audience more effectively," he says. "It was primarily a prospective site but we've added a members area to interact more with people."

There's no let-up in the hunt for new members, though. Brosse will continue to use tactical pay-per-click search campaigns and has recently trialled affiliate sites with a focus on local content to run alongside existing campaigns for local business directories. At Fitness First, head of CRM David Jones reports some "toe-dipping" in affiliates that run local content, as well as a shift to concentrate on SEO as well as PPC this year.

"Just like with our PPC campaigns, we're going after people who know what they want and are very specific, but tweaking the site can sometimes feel like a never-ending task," he says. "So the content has to reflect these search criteria. People will generally search for a specific activity or their goal for their area, so we book PPC campaigns and optimise for terms such as 'spinning class' or 'body pump', with a list of place names in the catchment areas for our gyms. This local nature is reflected in the PPC terms we bid on and the affiliate work we've started doing this year. We're just dipping our toes at the moment but we're pretty pleased with the success rates so far."

Social encouragement

Where the chains could find a differentiating factor is with social media. Adidas, Reebok and, of course, Nike with Nike+ have put a great deal of effort into sites that allow people to share information about their training regimes, swap exercise tips and even suggest good runs and sporting activities in their area. Yet gym chains have done very little to tap into this. When asked what they're doing, marketing managers for the chains point to sporadic Facebook fan sites and the occasional YouTube video posted by their users or staff, but admit they've done virtually nothing to tap into grass-roots interest.

However, 2009 looks set to change this and could see the gyms launch their own social networks. LA Fitness's Jenkins claims it's high on his to-do list, and Fitness First's Langridge is promising to launch a social network in 2009.

"It's very flattering that some fans and some staff have launched pages on Facebook and MySpace," Langridge says. "It's fair to say we haven't done a great deal with Web 2.0. It's mainly down to us wanting it to be real. It's far more subtle if it comes from members getting together to swap tips and arrange a run or a cycle than if we do it.

"However, we're now looking at this as stage one and we'll definitely launch stage two this year. Rather than sit back and let fans set up pages for us, which they can still do, we'll be building our own social community for our members so they can keep in touch with each other and maybe organise social events for fellow members, getting people together for training runs outside the gym."

What state the industry will find itself in when these social network plans are due to be converted into action will probably be a lot clearer once the January peak season is over. Gyms will know then how many new members they've signed up and, crucially, how many members who signed up in a previous January have renewed.

The Fitness Industry Association's Dean believes that, as far as discretionary spend in the leisure sector goes, gyms will be cut back on less than the cinema and eating out. Despite the economic climate, as of June 2008, FIA State of the Fitness Industry figures show the industry had grown 2.6% in market value to £3.7bn. Just under a fifth (18%) of the British population go to a gym, health club or leisure centre at least once a week, but half this number (9%), some 7.2m, belong to a gym. This suggests there's still room for growth.

While January is a peak time for marketing, there will be others this year for the industry, such as September, when people return from their summer holidays resolving to have better bodies for the beach. However, Nuffield Health's Wickers believes the gym chains that have put a lot of effort into online offers might find they're ditched as soon as money becomes tight or a better offer turns up.

"Some gym groups have turned their home pages into huge offers that promise a great deal, but I'd question where the loyalty is," she says. "We'll have new services to market next year which add value, such as health checks. If you make everything about price and the latest offer, you have nothing to offer people when they come to renew. There's just no loyalty there. So we'll be marketing our new offering around holistic health and not just fitness, and leave the latest web offers to others."

However, in response Fitness First and LA Fitness point out that in tough times people appreciate a brand that offers flexibility in its packages and allows people to use its entire chain for little or no extra cost.

"In tough times people want to find a good deal, but also you have to be flexible," says Jenkins. "You have to use your marketing channels, such as the web, to let people know they can pick how long they sign up for, get a deal and, just as importantly, their membership can move around with them. There will be a lot of people moving around to keep themselves in work or switching to a different job. It's going to be a very transient market."

Cutting churn by predicting member lapses

Nuffield Health, formerly Cannons, wants to take its understanding of churn beyond the industry norm of counting how many times a member went to the gym recently.

The company has turned to CRM specialist ICLP, which interrogates large databases to find patterns of consumer behaviour. Matt Hutchison, head of analytics at ICLP, says that for Nuffield it's looking at several factors and then scoring members on their likelihood to lapse when their membership expires.

"We take into account much more than just how often they've been going to the gym," he says. "We look at age and gender, as well as the length of time they've been a member. Use of the gym is a good indicator, but even if someone's visits have dropped over a few months, if they've been with a gym for a long time they're less likely to lapse completely. Also, the younger someone is, the more transient they are; they may be changing jobs and moving around, so they are more likely to lapse.

"We use algorithms to score everyone out of ten, where ten is most likely to lapse. Nuffield then takes action with people who score eight or more before it's too late. Gyms tend to wait until someone leaves before trying to win them back. With our system, we believe we're at least 70% accurate with the people we say are likely to leave, and that's way above what you could do by looking at gym attendance alone."

Nuffield Health's CRM manager Jodie Wickers says there are several options her team can try to prevent churn, such as the offer of a free personal trainer session or a spa treatment. "We have a monthly email newsletter that we can personalise for those who are looking less likely than others to renew," she says. "We can put in details of new classes and different things people can do at the gym. We can also offer free guest passes through an email, which can encourage people back to the gym, as can the offer of a complementary session with a fitness advisor."