MMS308 SPORTS MARKETING
Strategic Sports Marketing Plan
CROSSFIT MELBOURNEA Marketing Plan to Raise
Awareness and Increase Club
Members
By Jayme O’Donoghue
Student Number-
EXECUTIVE SUMMARY
This report examines the sport and brand of Crossfit. We examine and analyze the
position of Melbourne Crossfit club, Crossfit Melbourne and how it is marketed in the
metropolitan areas of Melbourne. We identify the external and internal environment
Crossfit Melbourne operate in and what its place is in the overall Melbourne fitness
industry. We recognize its competitors and what strategies they are using to create
brand awareness and gain customer memberships. Crossfit Melbourne’s main
competitors are large franchise gyms. We also analyze Crossfit Melbourne strengths
and weaknesses to see what can be better done internally to market the business.
Through this environmental research gathered we have created a marketing plan that
is based on gaining awareness and members for the club. We will heavily use new
media to target out market of young people living in Melbourne metropolitan areas
with an interest in fitness. This will particularly include social media. Along with this
we will offer open days and free classes. Advertising, direct mail and PR will support
this.
Table of Contents
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1.0 Current Marketing Situation...............................................p4-5
2.0 Analysis and SWOT..............................................................p6-17
2.1 Macroenviroment Factors.......................................................p6-8
2.2 Microenvironment Factors..................................................... p9
2.3 Porters Five Forces................................................................. p10-11
2.4 Product Analysis..................................................................... p12
2.5 Competitor Analysis............................................................... p12-15
2.6 SWOT Analysis...................................................................... p16-17
3.0 Objectives................................................................................p18
3.1 Rationale of Objectives............................................................p18
4.0 Marketing Strategy................................................................p19-24
4.1 Segmentation............................................................................p19-20
4.2 Targeting..................................................................................p20
4.3 Positioning............................................................................... p20-21
4.4 Marketing Mix..........................................................................p21-24
5.0 Action Plan..............................................................................p25-26
5.1 Budget.......................................................................................p27
5.2 Evaluation and Controls............................................................p28
6.0 References................................................................................p29
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1.0 CURRENT MARKETING SITUATION
Crossfit Melbourne’s main aim is to forge a broad, general and inclusive fitness. The
Crossfit brand was created Greg Glassman after seeing a gap in the fitness market- he
wanted to know what physical skills would most lend itself to performance advantage.
He decided that taking aspects from all sports would do this, thus the crossfit specialty
is no specializing. Crossfit optimizes fitness through constantly varied, functional
movements performed at a relatively high intensity. (Crossfit Inc, 2013). The crossfit
brand is also very community oriented. The brand creates spontaneous communities
through its participants doing the workout together (Crossfit Inc, 2013).
As a brand, Crossfit’s revenue is high- In 2012 it made $50 million. It is predicted by
the end of 2013 it will have doubled its revenue to $100 million (Helm, 2013). As a
business however, Crossfit is neither a wholly owned chained nor a franchise. Instead,
those starting up a Crossfit business become an affiliate owner and pay a flat rate to
use the crossfit name (Helm, 2013). The crossfit gym is also called a “box”. The
culture of one specific box may be very different to Glassman’s original company.
Glassman encourages affiliate owners to be free in the running of the box and train
how they want and charge what they want. Currently, Crossfit has 6774 affiliate
around the world and by the end of 2013 it is expected there will be 10000 (Helm,
2013).
Crossfit Melbourne is apart of the Melbourne fitness industry. Fitness activity is
defined as participation in “aerobics, fitness and gym activities.” In 2009/2010, over 4
million Australians participated in fitness industry activities. Of this, 14% participated
in fitness activities such as aerobics, pilates and weight training, this rate is up from
12.6% in 2008/2009 (Fitness Australia, 2012). Fitness industry research shows that to
create customer loyalty, Crossfit Melbourne will need to focus on creating
professional staff, the overall atmosphere of the facility and the availability of
working equipment (Fitness Australia, 2012). The fitness centers of competition to
Crossfit gym are franchised owned gyms, which account for 45% of gyms in
Australia (Fitness Australia, 2012).
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Overall, creating a marketing strategy for Crossfit Melbourne is a viable. Despite the
economic downturn, the fitness industry is still making money. In 2012, it had a
revenue of over $1.2 billion an contributed to $1.4 billion of Australia’s GDP (Fitness
Australia, 2012).
2.0 ANALYSIS AND SWOT
2.1 MACRO ENVIRONMENT
2.1.1 TECHNOLOGY-
As technology changes, making new trends in consumption, Crossfit Melbourne can
use it to innovate and change the way they distribute information to consumers.
Firstly, Crossfit should target the message that their gyms provide the most instant
and relevant fitness and health information of any gyms. It is through websites and
social media that this occurs. Consumers constantly want adaptions and updates to
products or services, therefore gyms need to provide real time reviews of gym
services and live gym consumption through self-service program tools (Fitness
Australia, 2012). In terms of gym machines, Crossfit must have the latest technology
in order to give customers first class machine personalization. To ensure consumers
get the most out of their workouts, classes should be video streamed afterwards and
wireless devices be used to record exercise programs. Moreover, to create more
streamlined distributions of class programs and admission tickets, many fitness clubs
are also using mobile device apps and websites (Fitness Australia, 2012). Along with
fitness innovations themselves, medicine and science developments will help to
achieve better wellness and fitness.
2.1.2 POLITICAL
There is firstly increasing pressure from our Government on business, particularly the
fitness industry since it uses so many electronic machines, to create more sustainable,
energy efficient practices. Secondly, the government’s concern over our population’s
health, obesity and inactivity levels largely affects the fitness industry (Dale et al,
2009). So many young people and particularly those included in generation X are
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overweight. Therefore, government initiatives to tackle obesity in both the young and
old may affect Crossfit’s training and program designs. Government will also over
time demand more and more accountability from big fitness companies in terms of
safety, injury prevention and encouraging good eating habits. Government and
insurers may subsidize more attention on preventing illness and disease (Dale et al,
2009).
2.1.3 LEGAL
Crossfit Inc. must make sure owners are compiling by the legal and correct affiliate
laws. The Crossfit name is a federally registered American trademark in the
Trademark Class 41 (Saran, 2012). In Australia it is also registered as the same
trademark, which was created by Crossfit owner, Glassman. The trademark is used so
customers recognize crossfit as a distinctive service in the fitness industry. The
Crossfit noun is now known around the world as a very specific style of training.
However, from this many owners and gym individuals steal the name and use it
illegally to market a style of training similar (Saran, 2012). This confuses consumers
and if the other gyms are not showing the same standards as Crossfit Inc. will tarnish
the brand name. Moreover, confusion spreads, particularly through the internet, about
the difference between Crossfit and “Crossfit the Sport of Fitness.” Under this name
many companies run “crossfit competitions” that are not run or authorized by Crossfit
(Saran, 2013). Thus, legally an overall issue for Crossfit is control the trademark.
2.1.4 ECONOMIC-
With the global economic downturn, many Australians have become more cautious
with their spending. However, while the growth is slow, the fitness industry has
revenue of over $1.2 billion with an average operating profit margin of 4.5%
(Australian Fitness, 2012). The fitness industry also contributes to $1.4 billion of
Australia’s GDP (Australia Fitness, 2012). The fitness industry’s economic outlook is
positive because as it has matured, young people who have developed a lifetime habit
of exercise may well carry the practice of utilizing fitness services into older age. This
is different to over 65 year Australians who had much less exposure and infiltration to
fitness centres and health information. However, as fitness is a mature industry
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operating in a very competitive and concentrated market, a growth in fee revenue
represents a change in demand rather than an increase in profit at the margin
(Australian Fitness, 2012). Thus, why Crossfit needs to be increasing awareness.
Crossfit’s financial and commercial credibility is also enhanced by the annual Crossfit
Games. For this event Crossfit partners with Reebok. Reebok has signed a 10 year
partnership agreement with Crossfit Inc which has increased the sport’s financial
prosperity and visibility in the sporting community. Reebok has allowed Crossfit to
give more prize money, which of course encourages more athletes to enter, thus raises
awareness and financial growth. Reebok is truly committed to be a Crossfit partner,
opening up a Crossfit gym at Reebok HQ and hiring two elite crossfit athletes as
coaches (Rische, 2011).
2.1.5 SOCIAL-
Overall there are similar participation rates in sport and recreation in both men and
women (65% and 63% respectively). In terms of age over 1 in 5 men and 1 in 3
women aged between 18 and 34 years use fitness services the most. Moreover 42% of
those who use fitness services are aged 25-34 (Australian Fitness, 2012). As the age
goes up the percent lowers. The overall fitness client population is located in
metropolitan areas (91%) (Australian Fitness, 2012). This is because as in 2011,
IBISWorld found that areas of higher income tended to have greater concentration of
fitness centres and facilities. Hence, those with higher weekly household incomes
participate in organized and paid for fitness activities. In 2009/2010 the participation
rate for the highest economic quintile was 85% compared to 45% in the lowest
quintile (Australian Fitness, 2012).
There are also many social trends developing in the fitness industry. Firstly, is helping
people become fit as a secondary consequence of activity that they undertake for
companionship, meaning or entertainment. Secondly, consumers are looking to move
away from a one-size-fits-all gym model at one central location. Thirdly, consumers
want to “bump into the fun” of exercise, thus fitness clubs need to be compelling and
connected to the bigger purpose (Dale et al, 2009). A social issue surrounding the
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fitness industry is women often feeling uncomfortable about attending the gym due to
body issues and gym confidence. Fitness centres need to “demystify” that strength
training is male dominated and teach women vital skills in the gym (Shrago, 2012).
2.2 MICRO ENVIRONMENT
2.2.1 STAFF-
Employees and trainers of Crossfit must be aware of the constantly changing fitness
industry, such as technology and medical advances. Trainers need to be able to
provide members with information and exercises that are always up to date with this
new information. Exercises and programs should be made easily adaptable by staff.
To be aware of the market, staff must visit fitness expositions frequently and scout the
web for new trends and routines (Prastarson, 2011).
2.2.2 CUSTOMERS
The market demand for gym memberships is seasonal. January attracts a lot of new
memberships due to new years resolutions and the weight gained over the Christmas
holidays. Sales then decrease and flat line until April when members become
routinized and start to join for the working year (Prastarson, 2011). During summer,
business is slow as customers use substitute activities due to the warmer weather such
as cycling, running, basketball, water sports and mountain climbing. Then in
September memberships rise again for the Christmas spending time.
2.2.3 COMMERICIAL
Crossfit attracts many partners and sponsors due to the Crossfit Games. Held every
year, the partners of the event include Reebok, Rogue and Progenex. The sponsors are
Altrient, Airrosit and Rock Tape. Although, they are mostly connected to US Crossfit
Gyms, we could still use these well known brand names to leverage gyms here in
Australia, particularly Melbourne.
2.2.4 MEDIA
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Crossfit’s media presence is mostly online. Crossfit Inc. has an official Facebook
page and Twitter account. Each affiliate club around the world is also most likely to
have their own individual “box” facbook page and twitter. Crossfit Melbourne in
particular has a Facebook, Twitter and Pininterest account. Crossfit Melbourne also
has a comprehensive website with links to additional fitness and diet websites and
online journals. Crossfit Inc. has an official online “Crossfit Journal” which consists
of articles, videos and youtube clips on health, fitness and diet. Finally, crossfit is
featured in editorial pieces in print and online health magazines.
2.2.5 FINANACES
The Crossfit brand is worth over $50 million. Crossfit’s main sources of revenue and
profit come from the annual fees of affiliates and the certifications for trainers.
Currently, annual fees are $3000 a year and certifications for trainers are $1000. It is
estimated therefore that the profit made by Crossfit in 2012 was $20 million (Huntley,
2012).
2.2.6 GOVERNANCE/LEAGUE
All the crossfit gyms are government by Greg Glasman. However, in saying this,
Crossfit does not enforce a lot of rules and regulations on their gym owners. Crossfit
Inc. gives each box the freedom to run the business how they wish and to cater their
gym to the specific customers visiting that gym.
2.3 PORTER’S FIVE FORCES
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FORCE 1- The Intensity of Competition between Existing Firms in the IndustryCrossfit Melbourne’s main source of competition is with other large gym franchises
in Melbourne. Although, other Crossfit gyms are competing with one another to gain
memberships, they are all still marketing the same brand. In terms of crossfit “boxes”
there are 12 clubs that attract the most numbers in metropolitan Melbourne. There is
also no direct competition from Crossfit due to the sense of community that the brand
is constantly trying to build amongst all Crossfit participants. The freedom given to
club owners decreases the intensity of competition between clubs.
The competition then is between large franchise gyms or “globo gyms.” A globo
gyms is the name given to large gyms by “crossfitters”. Globo gyms offer similar
equipment and membership fees. At globo gyms group classes, such as pilates, yoga
or body pump, are also included in the monthly or weekly fees. Thus, although there
are many differences in training style, instructors, community spirit and the intensity
of the workout, from an outsider perspective and for those not aware of what Crossfit
it, the two types of gyms appear very similar. This makes the intensity of rivalry high.
The globo gyms of competition include Genesis, Fitness First, Snap Fitness and
Goodlife.
FORCE 2- Threat of New Entrants-
The threat of new entrants is always high when there is a possibility to make profit.
This is true for most gyms as for many consumers attending a gym is based on
convenience of location (Prastarson, 2011). Thus, there will always be a set of
consumers who find the new location more beneficial. Many gyms also do not charge
a cancellation fee for members. Thus, the low switching costs for customers is
appealing for both franchises and crossfit affiliates to enter the market. Easy access to
fitness machine distributers and sellers is also appealing. Factors that may deter new
entrants however include the high capital requirements needed to buy fitness and
health equipment, the capital requirements for gym upkeep and the high expenses
required on advertising in order to keep members and gain new ones (Prastarson,
2011).
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FORCE 3- Power of Suppliers-
The power of suppliers in the fitness industry is relatively low. In Victoria, there are
many suppliers that offer comparable exercise machines and gym equipment.
Therefore, it is hard for sole suppliers to drive up prices and also easy for buyers to
switch to another brand (Prastarson, 2011). Gyms are also not frequently buying new
equipment every month or week for example. Most would order their equipment in
one large bulk at the beginning of every few years or until a new piece of technology
comes out on the market. Thus, as businesses are not buying frequently, prices stay
steady. It is also easy for gyms to substitute one piece of equipment for another since
most equipment brands make similar generic cardio and weight machine products. If
not locked into an agreement with a supplier, changing would be easy. However, what
could make the power of suppliers higher is the quality of gym products or if
customers become accustomed to using certain equipment brands. They may become
disgruntled if gyms switch brands, which could raise supply costs.
FORCE 4- Power of Buyers-
The power of buyers in the fitness industry is high. Although most gyms always have
a set number of very frequent customers and are also always gaining new members
through advertising, special promotions and word of mouth, customers still dictate
gyms. Customers have a large impact on what types classes are programed and how
the classes are timetabled and structured. The classes and timetables must fit with
their needs and their schedules. If gyms do not satisfy customers by providing the
right types of training and equipment, it is fairly easy unless locked into a contract to
switch gyms. In the case of membership fees, the customer bargaining power is rather
low particularly for Crossfit gyms. There are fixed yearly or monthly prices for every
member. However, at certain promotional times of the year such as Christmas, buyers
may gain more bargaining power. For example, many are able to bargain that they
will only join if their joining fee is wavered.
FORCE 5- The Threat of Substitutes
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Substitutes are other recreation and leisure activities offering similar benefits to those
provided by your sport or sport business. This is the force that provides the greatest
competition in the sports league or business. Substitutes are often thought of as other
forms of “entertainment” (text, pg. 26). Substitutes to Crossfit could include
watching and attending sporting games such as AFL, soccer, tennis, basketball,
cricket, baseball and netball. Other substitutes activity clubs or centres that benefit
health and fitness in similar ways to crossfit include, yoga centres, pilates centres,
swimming and recreation centres such as council centre, YMCA, and tennis courts.
The target market may also substitute crossfit with outdoor exercising such as
walking or running. In terms of the benefits that crossfit gives it’s consumer, that is
having a leaner, stronger and better look body, other products which give the same
benefits are beauty and fashion, including cosmetic surgery such as liposuction, raw
and organic food, high technology food that includes core nutrients such as protein
and medical drugs. Finally, entertainment substitutes to Crossfit in Melbourne include
movie cinemas, golf courses, the Botanical Gardens, Luna Park, the Moonlight
Cinemas and the National Sports Museum. They also all include a smaller fee than
Crossfit. This shows why a strong marketing plan for Crossfit Melbourne must be
created.
2.4 PRODUCT/SERVICE ANALYSIS
Crossfit Melbourne is a crossfit affiliate located in Caulfield South, one of Melbourne
south-eastern suburbs. Crossfit Melbourne is managed under the same owners of the
Schwartz’s Personal Training Studio, created in July 2000. The studio became a
licensed affiliate of Crossfit Inc. when owner Ben Schwartz travelled to the US to
take part in the Crossfit seminar in 2009 (Crossfit Melbourne, 2013a). The Crossfit
training options offered at Crossfit Melbourne include group classes, more specific
and tailored private training and crossfit youth classes. Despite seeming too intense
for some customers, the classes are designed for any type of customer. The
participants range from new fitness enthusiasts, stay at home mums, grandparents,
triathletes and weightlifters. A unique selling point for Crossfit Melbourne is that they
use resources and equipment that commercial gyms and personal trainers don’t have.
This includes gymnastic equipment such as rings, money bars, beams, ropes and
paralettes (Crossfit Melbourne, 2013a). The training programs show how to achieve
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last health and fitness through strength and conditioning. They are broad, general and
inclusive and can be made applicable to every person. It is only the load and intensity
of weights and cardio activity that are changed for varying types of individuals.
Routines are also constantly changing which means the rewards are constantly
dramatic. The service promotes better posture and movement making customers look
good but also assisting in rehabilitation (Crossfit Melbourne, 2013a).
The membership payment for Crossfit Melbourne is $209 per month. There is no
contract term and it can be cancelled at any time. Through this payment members can
participate in as many group classes as they want. Classes can also be attended
casually for $25 per class for the first month and then $30 per class after this. Before
beginning group classes customers are required to attend three private training
sessions. Here the correct movements, form, technique and posture are taught. These
sessions are $55 each (Crossfit Melbourne, 2013b).
2.5 COMPETITOR ANALYSIS
Immediate Competitors- Genesis and Fitness First
Secondary Competitors- YMCA, Basketball Leagues, Football Leagues
Indirect Competitors- AFL matches, Botanical Gardens, Australian Open.
GENESIS GYM CAUFIELD
Geographic Location

Caufield, Melbourne.
Mission and Vision

To become one of Australia’s premier
fitness organisations.
Objectives

To help customers with weight
management and health issues.

To help members become fitter and
achieve their goals.

To be actively involved in the
community.
Market Share and Position

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Genesis Fitness is a large player in the
fitness industry. They are modern and of
high technology.

They compete against other franchise
gyms in Melbourne.

They would hold a strong market
position with youths and those who
want to be fit.
Strategy

To gain a competitive advantage they
use highly quality personal trainers and
high tech equipment. They also offer
attractive membership packages with no
joining fee. The membership price gives
members access to all group classes.
Target Market

Genesis targets a very large group
between the ages of 15 and 60+. Most
would be of medium to high economic
status and living in metropolitan areas.
Marketing Mix Approach

Genesis use social media, such as
Facebook and Twitter. They advertise in
fitness magazines and through outdoor
billboards. They create brand awareness
through their logo.

They also allow free trials of up to a
month of customers thinking of joining.
Thus, use promotions as a large part of
their communication mix.
(Genesis Fitness, 2013).
WAVERLY BASKETBALL ASSOCIATION
14
Geographic Location

Caufield/ Malvern area
Mission and Vision

To be the best basketball club
association for the people of the
Waverly area.

Objectives
To get children and adults
involved in physical activity from
a young age.

To create community spirit.

To be a well organised association.

To raise the awareness of the
club’s senior and junior leagues.

Market Share and Position
They have a large market share of
those aged 7 and up who want to
play basketball for fitness and fun
in the Malvern and Caulfield area.

Strategy
To gain a competitive advantage
they use quality coaches and
modern stadium equipment.

They ensure the venue is clean and
accessible with friendly staff.

They offer value for money
membership prices.
Target Market

Well-trained umpires.

Targets a very large group. They
are between the ages of 7 and 30
Most would be of medium to high
economic status and living in
metropolitan areas.

Marketing Mix Approach
They have a website which lists all
the important and necessary
information consumers need to
know before joining the club.
(Waverley Basketball, 2013).
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MELBOURNE FOOTBALL CLUB- AFL
Geographic Location

Melbourne
Mission and Vision

To be one of best playing clubs and
the most community based club in
Victoria.
Objectives

To win a premiership

To be actively involved in the
community.

To raise the awareness of the club
through Victoria.
Market Share and Position

To increase membership every year.

To gain sponsors.

They are one of the oldest AFL teams
thus have a strong position in the
market.
Strategy

They are Victoria’s oldest AFL team.

To gain a competitive advantage the
Melbourne Football Club positions
itself through its heritage. They try to
gain loyalty through promoting their
current players and past successful
players. They interact and engage
widely with their fans and the whole
football community.

Target Market
It has a large target market of all
those who live in Melbourne plus
those right around Australia who
support the AFL.

Target families specifically.

Most would be of medium to high
economic status and living in
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metropolitan areas since it’s target
market are those based in the city of
Melbourne.
Marketing Mix Approach

Facebook

Twitter

Instagram

“Dee TV”

Interactive website

Direct mail

Promotions on memberships.
(Melbourne FC, 2013).
2.6 SWOT ANALYSIS
Strengths

Comprehensive website

Knowledgeable and strong trainers.

All trainers are certified in the Crossfit Level 1
Certificate plus other fitness and personal training
certificates.

They have youth training sessions.

They offer detailed nutrition advice on the website.

They have a partnership with “Paleo Snacks.”

Their website features instructional and training
videos.

Being an affiliate gym they have the support of
Crossfit Inc and owner Greg Glassman.

They are able to gain advice from the overarching
brand.

At the same time the brand is structured to give
“crossfit boxes” freedom to run their business. This
allows a more individualized service.

The gym is located in a metropolitan suburb where
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many customers will have medium to high incomes
Weaknesses

Their social media presence could be greater. They
need a Facebook fan or group page instead of
customers having to make a friend request.

They could have a greater impact through their
Twitter.

They don’t have an Instagram account

Their website looks too cluttered. It needs to be
more clean and streamlined.

At $209 per month, memberships could be
considered too expensive.

Crossfit could be seen as too intense to try from an
outsider perspective.

Fear from the customer of not being fit enough to
join or participate in the program.
Opportunities

Crossfit Melbourne is located in a metropolitan
suburb.

The residents of the south- eastern suburbs have
medium to high incomes to dispose on nonnecessary purchases.

Using the Crossfit brand name as it is known around
the world.

Customers of the fitness industry constantly want to
be working out in innovative ways.

Customers do not want routine workouts.

Many families live in the south-eastern suburbs thus
we have the ability to market to teenagers who will
join young and stay members into their adulthood.

Customers in metropolitan areas are often very
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trending driven and enjoying trying new activities
such as Crossfit.

To use social media effectively to reach young
people.

They have the opportunity to educate Melbourne on
what Crossfit actually is to stop customers
becoming confused.

They can begin to employ blogging and Instagram
to communicate the benefits of Crossfit to
consumers.
Threats

There are many “globo gyms” throughout
Melbourne.

Globo gym memberships are cheaper than Crossfit
memberships

The long term viability of promoting Crossfit
Melbourne

Franchise gyms may be seen to offer more to
customers- they offer both gym facilities and
classes.

Customers may not have the money to spend $209
per month of fitness memberships in this economic
downturn.

There are other non-affiliate gyms that use the
Crossfit name but do not have the same values or
ideals. This licensing problem may confuse
customers.

Franchise gyms such as Genesis and Fitness First
have excellent use of social media.

Franchise gyms often have a more established brand
awareness, which means customers have better
brand knowledge in comparison to Crossfit.
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3.0 OBJECTIVES
To increase the awareness of Crossfit Melbourne and as a result 50% of the
target market will have heard of what Crossfit Melbourne is by the end of
2014.

To increase the membership base of Crossfit Melbourne by 15% each year
until 2016.
3.1 RATIONALE OF OBJECTIVES
Due to Crossfit being less well known in Melbourne, but so well known in other
major cities in the world, it is important that Crossfit Melbourne penetrate the
Melbourne market to ensure they are recognized and popular in Melbourne suburbs.
We are focusing on brand awareness to create better brand knowledge and in turn
brand equity. Crossfit has so many benefits for health and fitness, thus the target
market needs to know this information to accept Crossfit into the fitness market and
be used as a service.
From creating more brand awareness we hope to raise the membership numbers for
Crossfit Melbourne. Once consumers are fully aware of how effective Crossfit is, and
since we are targeting to a market who are affluent and are concerned with physical
looks and social status, they will consider joining the crossfit gym. This objective is
an effective as it also focuses on increasing profit for Crossfit Melbourne.
4.0 MARKETING STRATEGY
4.1 SEGMENTATION
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Market segmentation is the process of dividing the total, heterogeneous market for a
product or service into similar segments. In these segments, consumers share similar
personal, psychological and environmental factors. Through segmentation, marketers
endeavor to satisfy as many needs and wants in the marketplace as possible (text, pg.
74). Therefore, it is important for Crossfit Melbourne to segment effectively as it will
allow us to categorize certain types of people and what their expectations would be of
the Crossfit service. This helps us to choose the right group.
This plan then has identified 4 segments in the market that are attractive for Crossfit
Melbourne’s environmental and internal analysis, and objectives. The segments
include
Demographic segmentation of ages 18 to 30 years.

Demographic segmentation of medium to high- income earners.

Demographic segmentation of residents who live in Melbourne’s metropolitan
areas.

Psychographic segmentation of young people who are fitness driven.
Currently in the year 2013, there are 4 million people living in Melbourne. The
demographic segment of age listed above would be considered generation Y.
Generation Y comprise of around 37% of the Melbourne population, which is 27, 850
people. 52% of these young people are female and 42% are male. The largest age
group in generation Y living in Melbourne are those aged 21-25 who add up to 16,
850 (Casey, 2006). This shows the segment is attractive due to its size- young people
are one of the largest age segments in Melbourne. They are also an attractive segment
since a large number of young people live in central areas of Melbourne- 26% live in
Melbourne CBD, 21% live in Carlton and 13% live in Southbank. All these areas are
close in proximity to Crossfit Melbourne. Finally this age group is attractive since the
majority have broadband Internet connections where in which they live, suggesting a
relatively well connected population (Casey, 2006).
We are segmenting through income and area residency as the two correlate. The areas
we most want to target are metropolitan suburbs located nearby to Caulfield, the
suburb Crossfit Melbourne. These suburbs are attractive since they are Melbourne’s
21
most affluent and where Melbourne’s most high incomers live. Toorak is
Melbourne’s most affluent suburb where residents have an average estimated income
of $132,252. This is followed by Brighton on $101,776, East Melbourne on $95,349,
Albert Park on $91,871 and Armadale on $89,534 (Waters, 2012).
In terms of why we are choosing to segment by the psychographics segment listed
above, it is because Crossfit is a sport or gym program that is highly intense but
produces very effective and constant changes to the body. Although every workout is
personalized to the customer, it is still not a lighthearted workout. The programs are
made to push customers to their limit. Thus, those who join would be driven by the
need to be fit or become even fitter.
4.2 TARGETING
The target market selection is an important process because it identifies the segments
in the market that are most attractive to your organisation. In the above section it
shows the most attractive segments for Crossfit Melbourne. The segments have been
selected as they will enable Crossfit Melbourne to gain the most success with this
marketing plan to build awareness and increase memberships. They have the most
appropriate lifestyles and demographic factors to suit the cost, location, activities and
values of Crossfit Melbourne. Therefore, the target market for this plan are 18 to 30
year olds, living in metropolitan areas of Melbourne who have high economic status
and are motivated by fitness.
4.3 POSITIONING
The positioning of Crossfit Melbourne is to be as an engaging, physically challenging,
rewarding, fun and attractive gym to join or go to casually when compared with other
franchise gyms.
We will position based on these three points-
Firstly, the unique, modern and innovative fitness program it provides. Crossfit has a
training ethos that emphasizes the importance of working on your weaknesses as well
as playing to your strengths. This creates, functional, effective and unique fitness
(Crossfit Melbourne, 2013a).
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Secondly, the Crossfit Melbourne training environment is community based. Extra
efforts are made by the staff and owners to not just make Crossfit Melbourne a gym
but a fitness and health mecca. To demonstrate Crossfit Melbourne offers diet
consultations, suggestions of how to undertake the official Crossfit, “paleo” diet,
travel work out tips, private training, the Crossfit Journal and videos and multimedia
with crossfit experts showing new, dynamic routines (Crossfit Melbourne, 2013a).
Thirdly, Crossfit Melbourne has the unique selling point of their highly qualified and
motivational trainers. They do not treat being a trainer as simply their jobs, instead
they dedicate their lives to Crossfit and fitness and health. They are always aware of
new fitness trends, exercises and diets. Crossfit Melbourne trainers themselves also
trainer harder then anyway, thus they are able to relate effectively to customer needs
and wants through their personal experience (Crossfit Melbourne, 2013a)
5.0 MARKETING MIX
5.1 PRODUCT
CORE PRODUCTThe benefit of the product that makes it
To create strength and
conditioning for the body.

valuable to the customer
The crossfit workouts or routines
can be scaled to suit absolutely
any customer

Focuses on four main areas- diet,
fitness and sport, gymnastics and
weight lifting.
ACTUAL PRODUCT-
the gym equipment, such as weights,
the tangible or physical product that
cardio machines and gymnastic
consumer get use out of.
equipment.
Consumers find use out of the trainers
since they are the ones who take the
classes and also personal training
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sessions.
AGUMENTED PRODUCT

The non-physical part of a

Community spirit

Access to modern and innovative
product and consists of the added
diet advice

value it gives to its customers.
Exclusive access to the global
Crossfit Journal

The opportunity to take part in the
global Crossfit Games

Sense of status- Crossfit is also
hugely popular and cool around
the world, particularly in global
cities such as New York City and
London, but has not reached this
stage of popularity in Melbourne,
customers will gain a sense of
status in knowing they joined
before “the masses.”

An ego boost of being on the cusp
of something popular which gives
feelings of being “hip” and
“cool.”
5.2 PRICE
Package
Price
Benefit
Crossfit melbourne
$209 per month.
Members are able to
membership
Cancellation can be made
participate in as many
at any time.
classses per week as they
like.
Crossfit melbourne start
$55 per session
Customers are taught the
up training package – 3
$70 per session for two
movemnets they will come
private training sessions.
people
acorss in class in an
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$90 per session for three
induvidualised and
people.
specialised way to ensure
the best understanding
possible.
Trainers will teach the
correct form and
technique.
Casual classes
$25 per session for the
Customer have the ability
first month.
to try classes before
$30 per session after the
signing up to a
first month of attending
membership.
casual classes.
However, if participating
in more that two casual
classes per week, it is more
beneficial to become a
member.
(Crossfit Melbourne, 2013b).
4.3 PLACE-
In sports marketing the element of place is seen differently. Sports generally do not
physically deliver their products. Instead, most products are simultaneously produced,
delivered and consumed in the same spot at the one time. Given this the sports facility
is the most important element in the distribution system. Therefore, the sports facility
for Crossfit Melbourne where there routines will be produced, delivered and
consumed at the same time is their crossfit “box” in Caulfield South. For the most
brand loyalty Crossfit Melbourne need to ensure the following about their gym
facility; easy access to parking, well designed aesthetics, comfortable relaxation or
stretching areas, state of the art weights and machines and immaculate cleanliness.
This will lead to improved perceptions about the quality of the crossfit box, which
will create higher satisfaction from members thus stay longer as members and return
to the gym frequently each week.
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4.4 PEOPLE-
The people or staff are one of the most significant marketing elements of Crossfit
Melbourne. Staff are responsible for the delivery of the product and as a consequence
are the main distinguishing quality factor in the consumption process. They represent
the most tangible part of the business for customers to judge the brand by. The five
criteria customers use to evaluate services are tangibles, reliability, responsiveness,
assurance and empathy. Thus, staff are important as all the criteria are fully dependent
on their training, skills and abilities to deliver high quality services (text, pg. 135).
Firstly then, trainers are needed to provide the best possible fitness programs to
customers. They represent the brand and motivate customers to become members.
How they teach the classes and the enthusiasm they show will determine the
customer’s brand feedings and judgments, thus increase brand equity. They must be
on time to classes, be responsive to any questions on exercises and programs and
responsive to customer problems.
Secondly, the must also empathize with their clients. This is important since many of
our customers may be uncomfortable about exercising if they are currently not at peak
fitness. They must understand their anxieties when it comes to training and find ways
to overcome this. Finally, they must assure customers that results will come with hard
crossfit training.
Thirdly, trainers will feature in the promotion of the club. They will feature on radio
advertisements and on promotion flyers. We will place quotes of their inspirational
words on brochures about the club. The fitness instructors will give seminars on
Crossfit to the local target market at universities, work places and high schools.
Moreover, trainers are involved in the routine demonstration video posts. These create
large brand awareness for the club particularly when placed on their Facebook and
Twitter site.
Lastly, we will also hire a Social Media Coordinator in order to increase the brand’s
online presence. As we are targeting the business to a young market, it is important
we leverage how much they use the internet and social media sites.
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4.5 PROMOTIONSThe Crossfit Melbourne promotional campaign will make it’s first role out on
November 1st 2013 and will run until the end of December 2016.
To promote Crossfit Melbourne we will create a major promotion campaign through
online channels. Particularly, Facebook, Twitter and Instagram. They are beneficial
tools since they are free to create and use. Moreover, as suggested in our
segmentation, more that 99% of those in our target market have their own computer
device and are connected through social media.
We will begin by making a Facebook Fanpage as there is no limit to how many
people can like your page. Your Facebook Fan Page is part of your Search Engine
Optimization strategy. This means you have more links coming up in the top of the
search rankings for google. We can also use our fan page to “promote” posts. This
costs money, however reaches every fan of the page. Secondly, we will create a
Facebook Group. Here we can share all our photos, contact and about information and
events but everyone can see the posts and comments without Crossfit Melbourne
paying for “promotes.” We will also link our training and instructional Crossfit videos
(Start A Box, 2013).
Twitter will be used along side Facebook. Unlike Facebook, where more interaction
can occur with customers, Twitter is used more to update customers on important
marketing and brand information. Crossfit Melbourne will use Twitter to post on
special events, new classes and new training and diet tips. We will also “retweet”. We
can retweets on what programs other Crossfit gyms are using, any tweets by Greg
Glassman and tips by Crossfit experts or health professionals. It will create a more
global platform for customers instead of just focusing on Crossfit in Melbourne (Start
A Box, 2013).
Lastly, we will employ Instagram frequently as a tool for showing photos of our most
fittest and motivated members. This gives motivation to customers. Through photos
of our members we will be able to demonstrate the wide range of people to participate
27
in Crossfit. We will also Instagram our crossfit box to show its modern, professional
and organized space. Our hastag will be #crossfitmelbourne and our name
@crossfitmelbourne, creating more brand awareness. In peak membership times, we
will run an instagram competition. Instagram users will upload a photo of them being
active in a crossfit workout and go in the draw to win a whole new gym wardrobe.
Social Media will be our main form of promotion since it fits the interests and
lifestyle of our target market. However, we will also use the following advertising and
promotional strategies
We will hold a number of Crossfit Melbourne Open Days. Here potential
customers will be given the opportunity to participate in one class for free.
These classes will offer an insight into the types of exercises and routines
Crossfit involves. It will also give existing members the chance to bring others
along to classes. We will advise current members of the promotion through
direct mail and potential customers through our advertising.

Mass advertising on Melbourne youth targeted radio stations such as Fox FM,
Nova and Mix 101.1 and during the times of 4-6pm.

We will do a letter box drop of pamphlets for those who live in the local area
of Caufield South and surrounding south east Melbourne suburbs.

We will gain editorial coverage through public relations. The publications we
will target include Melbourne newspapers such as the Herald Sun and lifestyle
and fitness magazines such as the “Sunday Style Magazine”, “Women’s
Fitness”, “Men’s Fitness” and “Cleo.” This will allow interviews and feature
articles on Crossfit Melbourne trainers, the training programs, values and what
members will get out of joining the gym. We can be informative in an
engaging and colorful way. We can also gain PR through fitness and lifestyle
websites and blogs.
5.0 ACTION PLAN
Promotion 1
Social Media; Facebook and Twiiter.
Responsibility
Crossfit Melbourne Social Media
28
Coordinator
What
Facebook fan page and group page, and
Twitter account to tell customers of
events, training tips and relevant and new
global Crossfit information.
Aim
To create brand awareness, to make
customers want to engage with the
crossfit community, to share fitness and
health idea and to build a strong club.
Stages
1. Constantly researching fitness
trends and being aware of any
new Crossfit ideas and
announcements.
2. From this will immediately post
the information on Facebook.
Beginning on November 1st and
When
consistently throughout the entire
campaign.
Cost
Free
Planned Outcome
Have over 1000 friends on both the fan
page and group and 1000 twitter
followers by the end of 2014.
Promotion 2
Social Media; Instagram
Responsibility
Crossfit Melbourne Social Media
Coordinator
What
An Instagram account to post photos of
Crossfit Melbourne members working
out. The hashtag, #crossfitmelbourne will
be used when users upload relevant
photos.
29
Aim
To create brand awareness, build the
crossfit community and share fitness and
health ideas.
Stages
1. Upload photos frequently.
2. In peak times, run an instagram
competition for instagram
followers and users to go in the
drawer to win a prize.
Beginning on November 1st 2013 and
When
throughout the entire campaign. Peak
times for the competition, include
October to December and April to May.
Cost
Free
Planned Outcome
Have over 1000 followers on instagram
by the end of 2014.
Promotion 3
Crossfit Melbourne Open Day
Responsibility
Crossfit Melbourne Owner and staff.
What
To create open day events to try and sign
up new members.
Aim
To show the benefits Crossfit Melbourne
offers in hopes the target market sign up
for a membership after being given a free
class.
Stages
1. Create radio advertisement to
advertise the Open Days on the
radio channels mentioned above.
2. Create flyers advertising the open
day to drop into letterboxes of the
surrounding suburbs.
3. Create flyers to give to current
members to pass onto friends.
4. Post about the event on our social
30
media sites.
5. Direct mail, in the form of email,
to current customers.
6. Organize the class timetable for
the event.
7. Organize “Paleo” food to be
provided.
8. Get instructors to work on the
day.
9. Measure success
When
Every four months from the beginning of
the campaign on November 1st 2013 to
the end of 2014. We will then do them
every 6 months after this until the end of
2016.
Cost
Every event will cost an estimated
$3000.
Planned Outcome
To gain 20 instant members, who
immediately join from each event day.
Promotion 4
Radio
Responsibility
Crossfit Melbourne Marketing Manager.
What
Radio advertisements on Melbourne
stations such as, Fox FM and Nova, to
inform customers on what Crossfit
Melbourne, persuade them to join or
remind them that the club exists.
Aim
To increase memberships and
membership inquiries and build brand
awareness and knowledge.
Stages
1. Create radio advertisement script.
2. Organize one of Crossfit
Melbourne’s most senior,
31
experienced and professional staff
members to read the
advertisement.
3. Book placement on various radio
stations.
4. Run ad placements.
5. Measure success.
We will start them on November 1st 2013
When
and then every four months during the
times of the open days. Here we heavily
advertise the promotion. During less peak
times we will place one advertisement on
every radio station 3 times a week
beginning from the campaign roll out.
The ads will be voiced between the times
of 4pm and 6pm weekdays.
Cost
$5000 for the production and $20,000 for
the placements.
Planned Outcome
To have the ad heard by 100,000 people
in the metropolitan area.
Promotion 5
Direct Mail
Responsibility
Crossfit Melbourne Marketing Manager.
What
. A printed pamphlet on the Crossfit
Melbourne offerings and membership and
class prices.
Aim
To increase memberships and
membership inquiries and build brand
awareness and knowledge.
Stages
1. Create text, graphics and layout of
the pamphlet.
2. Print 30,000 copies of the
pamphlet.
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3. Employ a pamphlet run service to
deliver them to houses in the area.
4. Measure the success.
When
From the start of the campaign launch
we will do a letter box drop every 4
months of 30,000 pamphlets throughout
the campaign.
Cost
$3000 for the production and $5000 for
the deliveries.
Planned Outcome
to have 4% of the letter box target
market to join during the month of that
delivery.
Promotion 6
Public Relations
Responsibility
Crossfit Melbourne Marketing Manager
and Gym Owner.
What
A press release to generate media
coverage.
Aim
To build brand awareness through media
stores and editorial coverage (Target
Herald Sun, Herald Sun Sunday Style
Magazine, The Age, Melbourne Weekly
and local Caulfield newspapers. We will
also target 5 online sources).
Stages
1. Draft press releases.
2. Send press release out to media.
3. Follow up with journalists to
ensure they have written positive
editorial coverage.
4. Collate the mentions received.
5. Measure success.
When
Throughout the campaign we will try to
feature heavily in print and online media
33
at the beginning, middle and end of our
campaign.
Cost
PR is free, staff costs only.
Planned Outcome
To generate 2000 website hits for
Crossfit Melbourne and hear a minimum
3 mentions every time a press release is
sent out.
5.1 BUDGET

We are financing the costs for this marketing plan through our current cash
flow from existing and new sales.

Our total promotion cost for the campaign period from November 1st 2013 to
31st December 2016 will be approximately $3,000 per month average over the
tree years. This has been calculated from the promotion costs listed in the
above tables and how often over the promotions will run over the total
campaign. Periodic Radio costs will be high initially but costs for mail outs
and social media will be far less at other times.
Sales requirements to grow the club and replace leaving members is based on:

Current Number of Members at Crossfit Melbourne- 300.

Current Drop Off of Members- 25% of members per year or 7 members per
month.

Increase in Members each year as per objectives- 15% or 45 members per year
or 11 per month (replacing the 7 who drop off and gaining 4 new ones).
Therefore, as a sales target we should achieve 15 new members per month.
The promotions budget will be $108,000 over 3 years.
Club Sales through this period will be $1,044,000 per year and increasing at 15%.
34
Promotion costs are 3.5 % of income, which would be considered low and could be
increased if required to meet sales target.
Sales staff costs have not been included as a direct promotions cost as staff are
required to carry out a variety of tasks in addition to sales.
5.2 EVALUATION AND CONTROL
Objective

To increase the membership base of Crossfit
Melbourne by 15% each year until 2016.
Control/Action

The gym marketing manager will measure the
number of memberships sold on the 1st of April,
July, September and December. We will
measure this against last years sales to see the
difference.
How

The marketing manager will do this through our
computer membership database.
Contingency Plan

We will also run more open days and free trials
of the gym.

We will send out more direct mail to the target
market which lists the programs and prices of
Crossfit Melbourne.
Objective

To increase the awareness of Crossfit
Melbourne and as a result 50% of the target
market will have heard of what Crossfit
Melbourne is by the end of 2014.
Control/Action

We will perform market research to test both
brand recall and brand recognition. We will do
this by creating a questionnaire and randomly
selection a population from the target market.
35

How
At the end of 2014 we will work with a market
research agency to create a questionnaire. We
will postal mail it to 3000 people in the target
market group.
Contingency Plan

We will participate and engage more with our
social media websites. We will also try to gain
more PR.
6.0 REFERENCE LIST

Glassman, G., 2010, “Defining Crossfit”, Crossfit Journal, retrieved 22
September 2013, http://journal.crossfit.com/2010/12/glassmandefining.tpl.

Crossfit Inc, 2013, “What is Crossfit? Forging Elite Fitness”, Crossfit Inc.,
retrieved on 22 September 2013, http://www.crossfit.com/cf-info/what-iscrossfit.html

Helm, B., 2013, “Do Not Crossfit”, Inc., retrieved 22 September 2013,
http://www.inc.com/magazine/201307/burt-helm/crossfit-empire.html.

Fitness Australia, 2012, “Australian Fitness Industry Report 2012”, Fitness
Australia, retrieved 22 September 2013,
http://bizaus.com.au/bizconsole/admin/media/listings/962/bizaus_pgw8vyakn.
pdf.

Saran, D., 2013, “What’s In a Name?”, Crossfit Journal, retrieved 22
September 2012, http://journal.crossfit.com/2013/04/whats-in-aname.tpl#featureArticleTitle

Dale, S., Godinet, S., Kearse, N., & Dr. Field, A., 2009, “The Future of
Fitness”, Nielsen and Les Mills, retrieved on 22 September 2013,
http://www.lesmills.com/files/globalcentral/docs/Future%20of%20Fitness%20
White%20Paper_Nielsen%20&%20Les%20Mills_final_Jan%202010.pdf.

Saran, D., 2012, “If it doesn’t say Crossfit, It’s…”, Crossfit Journal, retrieved
22 September 2013, http://journal.crossfit.com/2012/08/if-it-doesnt-saycrossfit-its-1.tpl#featureArticleTitle.
36

Huntley, T., 2012, “Why Crossfit Inc. may be worth $500 million?”, My
Athletic Life, retrieved 22 September 2013,
http://myathleticlife.com/2012/02/crossfit-worth-500-million/.

Rische, P., 2011, “Crossfit’s relationship with Reebok enhances its financial
and commercial credibility”, Forbes, 22nd June, retrieved on 22 September
2013, http://www.forbes.com/sites/sportsmoney/2011/07/22/crossfitsrelationship-with-reebok-enhances-its-financial-and-commercial-credibility/.

Shrago, S., 2012, “CrossFit brings in women, the 'globo' gym-weary, and the
simply curious”, NY Daily News, 2nd July, retrieved on 22 September 2013,
http://www.nydailynews.com/life-style/crossfit-brings-women-globo-gymweary-simply-curious-article-1.1106567.

Prastarson, J.I., 2011, “Glusa Gym- Business Plan”, Bifrost University,
retrieved on 22 September 2013,
http://skemman.is/stream/get/1946/10991/27021/1/.

Genesis Fitness, 2013, “About Genesis”, retrieved 22 September 2013,
http://www.genesisfitness.com.au/about-us.

Waverley Basketball Club, 2013, “Waverley Basketball Association”,
retrieved 22 September 2013, http://www.waverleybasketball.com/

Melbourne Football Club, 2013, “MFC- The Club”, retrieved 22 September
2013, http://www.melbournefc.com.au/the-club/history

Crossfit Melbourne, 2013a, “Crossfit Melbourne- About Us”, retrieved 22
September 2013, http://www.crossfitmelbourne.com.au/.

Crossfit Melbourne, 2013b, “Membership Details”, retrieved 22 September
2013, http://www.crossfitmelbourne.com.au/.

Casey, N., 2006, “City of Melbourne Young People Demographic Profile”,
City of Melbourne, retrieved 22 September 2013,
http://www.melbourne.vic.gov.au/AboutMelbourne/Statistics/Documents/De
mographic_Profile_Young_People.pdf.

Start of Box, 2013, “Social Media- Take Full Advantage”, retrieved on 22
September 2013, http://www.startabox.net/index.php/marketing/social-media.

Waters, C., 2012, “Australia’s Richest Suburbs Revealed”, Thursday 29d
November, Smart Company, retrieved 22 September 2012,
http://www.smartcompany.com.au/property/053172-australia-s-richest-
37
suburbs-revealed-including-the-suburb-with-an-average-salary-of-132252.html.
38