Specialist
Senior executive at Fitwell Advisors
Agenda
- Key trends and developments in the fitness industry
- Gyms membership freeze rates and outlook on consumer confidence to return to gyms
- Digital platforms and at-home offerings
- 2021 outlook
Questions
1.
What key fitness industry developments have you been monitoring since our previous Interview [see Boutique Fitness Industry – North America Recovery Trajectory & Long-term Outlook – 25 September 2020]? Do you have any opinion on this morning’s news of the Pfizer-BioNTech COVID-19 vaccine?
2.
How do you think gym memberships are trending at this stage of the pandemic, and how does it differ across club tiers from the higher-end to the high-volume, low-price gyms, as well as across geographies in the US?
3.
What would you say are the broad competitive advantages of gyms in this environment vs pre-coronavirus? It seems as if customers typically choose a gym almost entirely based on location.
4.
Is there reason to believe that supply coming offline – whether through 24 Hour Fitness or TSI [Town Sports International] restructurings – will result in a tailwind for the other operators?
5.
How would you say Life Time Fitness’s growth prospects and strategy is perceived within the industry?
6.
Are operators having to discount monthly dues to keep user attrition low? How much has the price changed for new membership dues in the last year?
7.
How would you assess the consumer perception of value? You mentioned that operators may sustain prices but will trim some amenities, such as towel service, which you said in our previous Interview can cost up to USD 4,000-6,000 per month. Could cuts to these amenities potentially impact the perceived value for consumers and result in attrition, even with prices maintained?
8.
What is driving customer decisions to continue to pay membership dues, and why are these customers signing up for contracts at all? Do you think those drivers are sustainable?
9.
Would you expect an inflection point in attrition? It seems to vary across regions – is there any correlation between attrition rate and COVID-19 case counts?
10.
What is your outlook for the potential migration of existing gym customers to HVLP [high-value, low-price] operators?
11.
What would you say is the major long-term risk for a player such as Peloton which has had such success in the connected fitness industry? In its most recent earnings report, it highlighted the supply chain as an issue – is there anything else you would note, especially in light of the imminent vaccine news?
12.
How would you characterise the risk to Peloton’s sales over the holiday season due to the supply chain issues? It is overextending itself on delivery times with 4-6-week delays, and we are already in November. Do you think that might be detrimental to its Q4 2020 results?
13.
How much of a shift would you expect for the in-home experience, considering Peloton vs its peers? Would customers potentially shift to a competitor if Peloton is unable to deliver in time for holiday season gifts?
14.
How much stickier can at-home offerings potentially become?
15.
What potential upside is there for Lululemon’s Mirror acquisition?
16.
Do you find that Mirror, Tonal and others are addressing a gap that Peloton is missing from its current product portfolio or offering?
17.
Once a vaccine is widely available, do you think it is the end of an era for the at-home fitness providers, or do you think the trend will remain longer term?
18.
How do you imagine the industry is interpreting the news of an imminent vaccine? Are there any clear winners who are best-positioned to recover first and come out stronger on the other side?
19.
What is your outlook for M&A in the industry?
20.
What strategies can gym operators implement to drive membership, especially in January when customers are keen to revamp their fitness habits and lifestyles? Some gym operators have rolled out digital offerings to retain their membership base – are there any other strategies you think will define 2021?
