Ray Algar looks at trend developments in the future of the sector
The health club industry, but not as we know it Presently, there are 2,900 private health clubs in the UK, which is one for every 15,000 adults. Let’s now move forward to 2016. Do you think there has been significant consolidation? Has there been a steep rise in the number of clubs? Do you think the service proposition has slowly evolved since 2006 or has a disruptive innovation occurred sending the industry on a fundamentally new path? Many brands benefit from ‘trend watching’ as a tool to provide insight into the rapid pace of change effecting their consumers. This is particularly acute in service industries where the nature of the relationship between the consumer and the brand can be volatile. A single negative experience can quickly turn a raving fan into a raging critic. It is easy for companies to understand consumer trends, with several suppliers tracking the global consumer ‘zeitgeist’, seeking the next big thing, whether it be understanding ‘youth culture’, from the trend-queen Faith Popcorn or online sites like www.trendwatching.com. Trendwatching.com identifies cultural ‘memes’ (self-propagating units of information), using a global network of qualitative researchers to feed back their observations, It reinforces the trend with examples of emerging products and services. Companies can also look at the life conditions, the social, technological, economic,environmental, and political factors,
(STEEP) that could affect people’s lives, and provide quantifiable evidence that helps them plan for the future. The intention is to enlighten companies about the rapidly-changing world of marketing-literate consumers. Yet often, the result is a client left suffering from over-stimulation, having sat through an information-rich presentation, which often contains new language (Jingle Casting, Massclusivity, Gravanity, and Insperiences) and a large quantity of data. Once the stimulation of the presentation and the new knowledge has faded, many are left wondering: “What does this mean for my brand or company? How relevant is this to my customers?” While everyone can see the need to understand the rapid pace of change, their ability to act is constrained by the pull of short-term business needs.
Placing consumers at the heart of scenarios Developing scenarios (a plausible account of a possible future) can help companies to imagine how trends might affect their market, by placing the trend information into a context that becomes relevant for them. It also enables them to put consumer needs at the heart of future brand planning. In order for this to happen, it is important to understand the depth of a trend and consider the various layers that shape and form the trends that lead to a shift in attitude. By building in a constant factor (basic human desires) and evaluating where the trend is positioned in terms of our evolving values as well as understanding the cultural context, we can begin to express the trends in attitude and behavioural terms.
The 16 basic human desires that drive us An illustration through the European health club industry. Let’s apply this approach to the future health club industry, which could benefit from increased political activity in the area of health. The government is planning to shift resources from the treatment of sickness to the prevention of illness and the improvement of health. Estimates suggest that the present National Health Service budget of £90bn may have to rise to £180bn by 2022 if preventable ill-health fails to be tackled. Similar challenges exist across Europe to improve activity levels, nutrition, diet and reduce smoking. So, what is the future role for health clubs, within this preventative scenario and how can they become instrumental in helping people take personal responsibility for their health and well being? What other trends might affect the way that health clubs evolve and develop over the next 10 years? Will it be ‘more of the same’ or will ‘niche’ clubs emerge? Will health insurers enter and dominate the market as they are now threatening to do in Holland? 14 Leisure Report l www.leisurereport.co.uk
Source: Steven Reiss
The European health club industry has undeniably prospered over the past 10 years with total members now standing at 21.5 million, representing a 5.5% European penetration rate, with further growth anticipated. However, if we look more closely at what happens once people have joined, we see a sense of dissatisfaction emerging. A recent report by Dr Melvyn Hillsdon showed nearly 50% of new members who joined a UK club had quit when followed up just six months later. With visit levels among some members so low that health and well being benefits are unachievable, what is missing from the health club proposition? Somewhere along the journey, members are falling out of love with their club. Why do they not feel emotionally connected to the club? Perhaps, the club is not fulfilling real underlying needs.
Preparing for the future Clubs that strive to genuinely understand the real needs of their members (those that get close and personal) will prosper, while those that rely on buildings and equipment will struggle. The real challenge is winning the intangible space – club atmosphere, the actions/behaviours of and personalised content. If we are genuinely moving into an era of individuality, where members expect genuine personalisation, then most health clubs lag way behind. Sophisticated members will simply vote with their trainers.
Health Clubs in 2016 What follows are some trends that are relevant to health and fitness and a picture of how health clubs might fit into this new era. As with all scenarios, we
can only explore what might be possible in order to help companies begin to prepare a future strategy. The three scenarios are the Experiensual club; Urban fitness pod; and the Pro-Science club. The trend towards individuality connects all three scenarios. This is not just about personalisation of service, it is also about respect: respect me, show respect by the way you deal with me and attend to my needs. Each scenario demonstrates how the delivery of individuality can be met in different ways – digitally, medically and naturally.
Experiensual Health Club Authenticity: Members expect honesty, integrity and transparency. This is shown by a growing desire to connect back with nature, to treat the whole person and to give something back. The growth in Fair-trade, charitable giving and the pressure on companies to be socially responsible, all reinforce this trend. Meaning: People are looking for ways to bring meaning into their lives. Many people recognise that material possessions bring a momentary feel good factor. In order to experience fulfilment, people need to feel that their lives have meaning and purpose, expressed through spirituality, family, work and relationships. Quantifiable life conditions: Environmental issues dominate this scenario; renewable energy, sustainability and urbanisation. More people will be using renewable energy, such as wind and solar as new technologies makes it more accessible. The trend is towards urbanised living and global working. We already live 90% of our waking day inside and are becoming ‘sensorially deprived’. In a recent study conducted by Dr Charles Spence, from the Department of Experimental Psychology at Oxford University, on behalf of ICI, he concluded that ‘We have a basic need for a balanced multi-sensory diet’.
Experiensual Health Club The Experiensual club is based on people’s basic human desire for tranquillity, idealism and social contact. It is an antidote to the creep of urbanisation as people gravitate towards cities and lose touch with the rhythms of nature, spending most of their lives in sterile, air-conditioned buildings. This club connects members back with nature, using different environments (personal sensorial cocoons) to stimulate the senses and using colour and texture to create different mood spaces. The natural environment forms an integral part of the club with outdoor gyms that flow from the main building. It appeals to members who have an holistic view of the world, with values of collective individualism, and believe that life is inter-connected. Individuality is delivered naturally and personally. Belonging to this club means that the senses are stimulated and cared for, just as much as the body. People begin to challenge the authenticity of a health club that claims to care for our personal health and wellbeing but is energy guzzling, waste producing and demonstrates a disregard for the environment. The experiensual club treats members and the environment with equal respect. The quality of the relationship between the club and members is very personal and responsive to mind, body and spiritual needs, with natural solutions to the promotion of well being. Staff are more akin to life coaches than sports technicians. The club avoids the direct use
of technology with members (members’ lives are now cluttered with gadgets), and instead uses it discreetly behind the scenes – high touch, low tech is the club’s operating philosophy.
Scenario 2: The Urban Fitness Pod Speed: Everything is happening faster. We have become impatient; we do not like waiting; speed is what we expect when it comes to dating, information access, eating, shopping, communication and service. We want brands to be flexible, open when we need them and to provide us with a fast, efficient and personalised service. Complexity: Everyday lives are increasingly complex. Slowly, we are being overwhelmed with information and suffering from ‘choice trauma’. We believe that we do not have sufficient time to fit everything in, even though many of us spend several hours as a couch potato. Quantifiable life conditions: Digital technology dominates this scenario. By 2016, ubiquitous technology will continuously connect us to friends, work, family and interest groups. With technology such as radio frequency identification (RFID), the connections will be seamless, helping people to control and filter the information they receive.
The Urban Fitness Pod The Urban Fitness Pod scenario is based upon the human desire for order and meets our need for efficient and fast fitness activities. This club appeals to the millennial generation who are technology ‘savvy’ with no time to lose. This club delivers individuality through technology, with the primary interaction between member and machine. The machines provide the personalisation of programming and speed of engagement that people demand. This is not a place to linger (no sun-beds, steam and saunas here) or a club for social engagement - it is clinically efficient. This is the health club equivalent of the Japanese capsule hotel. There is very limited staff contact, if you really need it. This is primarily about getting a quick dose of fitness and then back to the office. Imagine being greeted by a robot. A biometric scan quickly calls up your profile. It knows what you did last time and what you should do based on your health status today. The robot also captures physical activity data from the global positioning device embedded in your arm. The machines are then automatically configured and ready to take you through your personally designed programme. Your results are emailed back to your office and copied to your virtual personal trainer to form a key part of your weekly video conference.
The Pro-Science Health Club Age Defiance: Medical breakthroughs, better nutrition, rising affluence and improved well-being and logevity are some of the factors driving ‘age defiance’, resulting in a re-classifying of the terms ‘middle’ or ‘old age’. Enhancement: Medical procedures that were initially developed to treat injury and disease are now being commonly used to service a burgeoning vanity market. Quantifiable life condition: Bio-medical breakthroughs dominate this scenario. The impact of technology in the next 10 years will be pervasive as we move into an era where technology and the
human body begin to merge. Cosmetic enhancement becomes commonplace and no more invasive than a haircut. Liposuction presently costs £1,000 in Belgium, and the price is falling as demand continues to rise. This is equivalent to the price of membership at a premium health club. This, coupled with obesity-busting drugs begins to leave health clubs in a vulnerable position, especially those in the weight management business.
The Pro-Science Health Club This club is based upon the human desire for order, social acceptance and individuality. It appeals to ‘older’ members who want to remain youthful. The Pro-Science Health Club incorporates the medical community, creating a seamless transition from diagnosis through to treatment. Staff in this scenario act as specialist interpreters of complex health and well being data. They are needed to advise on the blend of drugs, surgical interventions, exercise and diet required to promote good health. Nanotechnology provides implantable devices that act as advanced drug delivery systems, while digestible diagnostic devices continually scan for a member’s pre-disposition to a wide array of specific illnesses, automatically alerting their doctor at the very earliest detection of rogue cells. The environment is professional, comfortably clinical, with a range of activities using science as a basis for understanding the members’ needs. These new ‘medi clubs’ provide renewed gravitas to health clubs as they become a more fundamental part of members’ lives and facilitators of good health. These clubs now bid for and secure substantial amounts of preventative health related funding (the NHS budget in 2016 is now £140bn), while forming deep strategic alliances with the insurance industry, as they become a key player in the health care business. This has helped to slow the move by hospitals, insurance groups and health related charities from moving directly into the health club industry.
Back to the Present Developing plausible scenarios can help companies imagine how trends might affect their market and identify ways to leverage future potential. An understanding of the layers of a trend helps to build scenario robustness. They enable companies to turn information into a stimulus that internal teams can creatively engage with, particularly in regards to strategy planning, innovation and risk management. They can help bring a human perspective to technological developments that might seem alien today, but commonplace in a few years. The result is corporate foresight that helps to illuminate some possible futures that prepare organisations as we move towards 2016. Ray Algar, MBA is the managing director of Oxygen Consulting (www.oxygen-consulting. co.uk), a company that provides strategic and profitable insights to sports and leisure organisations. Ray can be contacted on +44 (0)1273 885 998 or e-mail firstname.lastname@example.org. Adapted from: How scenarios can help you plan future brand strategy, Algar & Hodgson, ADMAP Journal, September 2005.
www.leisurereport.co.uk l Leisure Report 15