• Past 50 Years
– Those exercising 100+ days/year outside of the home
• 1960 – 10 million
• 2000 – 55 million
– Why the huge increase?
– Those exercising in the home is ~ equal
• Explain this phenomenon
• What makes home-based training such an attractive option?
– Stereotypes
– Convenience
– Fear
– Lack of Education

Number of US Clubs 29,069 (1/06)
Number of Members 41.3 Million
Number of IHRSA
Clubs
4,200 (1/06)
Revenue Generated in 2005
$15.9 Billion
Source: IHRSA/American Sports Data 2005 Health Club Trend Report

Source: IHRSA/American Sports Data 2005 Health Club Trend Report

• Only 22% meet ACSM guidelines
– Explain the disparity between participation rates and guideline compliance
• Lack of quality education on the topic
• Barriers to exercise (work, home, etc.)
• Social issues
– What is the answer?
• Programming
• Convenience

• 59% of inactive Americans report a desire to become more active
– We must bridge this gap
• How do you reach this market?
– Consider “softer” approaches
» Exercise Lite
– More “user friendly” programming
– Less intimidating settings
– Employees should mirror market
– Consider décor & design

• Commercial
– For profit
– 26% of market share
– 8% market penetration
– Trends
• Less single-purpose clubs
– Racquetball, Tennis
– More multipurpose
• Less indoor-only
– More 4 season clubs
• Greater emphasis on programming
– Less “sales-based” clubs
• Movement away from annual dues
– More month-to-month plus initiation fees
» Holds club accountable to provide quality service

Source: IHRSA/American Sports Data 2005 Health Club Trend Report

Source: IHRSA/American Sports Data 2005 Health Club Trend Report

Source: IHRSA/American Sports Data 2005 Health Club Trend Report

• Gold’s Gym – www.goldsgym.com
– 500+ Locations
– Inexpensive (~$35/month)
– Appeal to 18-35 population
– Tend to be less service-based
• Bally’s Fitness – www.ballyfitness.com
– 350+ Locations
• Inexpensive (~$35/month)
• Similar market as Gold’s
• Very sales driven
• Club Corporation of America
• 250+ Locations
• More expensive (~$55/month)
• High-end nature
• More service-based

• Corporate
– On the rise in recent years
• Corporations use it to attract employees
• Part of the “package”
• Good tool for retention
– Dependent on size of the workforce
• Vast majority of U.S. corporations have
<100 employees
• Typically found in corporations With >750 employees

• Benefits to corporation
– Greater productivity
– Enhanced retention rates
– Lower health care costs
– Lower absenteeism
• Inherent Differences
– Not based on sales
– Constant membership base
– Get to know members VERY well
– Totally driven by employee productivity outcomes
– Usually the first “extra” to be cut from budget

• ~1000 hospital-based facilities
– Increasing rapidly
• Movement toward total care model
– Health care + health fitness
• Closely associated with outpatient services
– Physical therapy
– Sports medicine
– Cardiac rehabilitation
• HCA’s see the benefit and $$$
– Health care administrators are now beginning to realize the value of prevention
• Reduced “revolving door effect”
• Increased revenue
• Total wellness model

• Nonprofit programs
– Tough competition
• Receive federal/state funding
• Offer extremely low membership rates
• YMCA, YWCA, JCC’s
• Typically attract members with lower
SES (socioeconomic status)
• Usually have pools, sports programs, and multipurpose facilities
• Also include hotels, condo-based fitness centers, apartment-based fitness centers

• Promotion
• Programming
• Management
• Different settings place varying emphasis on these 3 areas
– Depends on their vision/mission
– Staff availability
– Nature of competition/lack thereof

Program Manage Promote
29%
42%
29%
• Why do commercial centers spend the most time promoting?

Program Manage Promote
25%
37%
38%
• Why do corporate centers spend the most time managing?

Program Manage Promote
25%
37%
38%
• Why do clinical centers spend the most time managing?

Program Manage Promote
37% 38%
25%
• Why do community centers spend the most time programming?

• Manager
– Administers daily operation
– Regulate budget
– Guide and direct staff
• Supervisor
– Hire and dismiss staff
– Oversee program and staff
– Evaluate staff
• Exercise Leader
– Guide participants
– Conduct classes
• Assessor
– Conduct participant testing
– Interpret results
• Planner
– Assess organizational needs
– Establish program goals
• Motivator
– Rah, Rah
– Sales & promotion
• Educator
– Influence participants
– Inform staff
•Emphasis on each area will vary in all 4 settings

Area Commercial Corporate Clinical Community
3,095 - 8% 2,109 – 5% 1,758-5% 1,695-4% Administrative
Exercise Areas 16,419
42%
18,059
49%
16,688
49%
16,806
43%
Warm-Up Areas
Multipurpose
Locker Rooms
Storage
3,895
10%
1,375
4%
6,450
17%
1,027
3%
422 – 1%
4,050
11%
2,461
7%
6,466
18%
963
3%
422-1%
4,895
13%
3,403
9%
4,950
13%
3,450
9%
2,475
6%
7,087
18%
858
2%
450-1% Laundry
1,631
4%
675-2%
Nursery
Snack Bar
Circulation
774
– 2%
844
– 2%
4,458
– 11%
------
-----
-----
-----
2,350-6% 1,800-5%
900-2%
675-2%
38,729 36,871 37,800 38,421 Total Sq. Ft.

• Objectives
– Commercial
• PROFIT – Primary Objective
– Expected from all profit centers
– Unless the department contributes to membership fees
» Fitness/Group Exercise
• Secondary Objectives
– High level of service
– Staff development
– Program implementation
“Does this action indirectly or directly contribute to the bottom line?”

• Corporate
– Primary Goals
• <Absenteeism
• <Health Care Costs
• >Productivity
• <Turnover
– All three must be monitored closely
– Secondary Goals
• Improve employee morale
• Increase enthusiasm

• Clinical
– Difficult to identify clear objectives
• Increased community visibility for the hospital
• Enhance institutional loyalty
• Increase patient volume - $$$
– Some programs operate independently
• Profit becomes primary objective
• Managed much like a commercial program

• Community
– Depends on the goal of overarching organization (YMCA, JCC, etc.)
• Each entity will take on the characteristics of their organization
• Community enhancement
• Outreach to lower SES populations
• Elderly/Children

• Target Population
– Influences every decision made within a given health/fitness organization
• Corporate
– Finite # of members
– Important to develop relationships, but difficult to stay motivated based on lack of profitability
• Commercial
– Infinite # of members
– May be less service oriented based on availability of members
» Market competition is beginning to cause increased service mindedness

“The more precious the prospective member becomes, the more program intensive the facility and staff become”