Specialist
Senior executive at Excel Fitness Holdings Inc
Agenda
- Key trends and developments in the gym industry
- Competitive dynamics across tiers, including boutiques vs connected fitness
- Consolidation opportunities and rebound scenarios
- Medium-to-long-term outlook
Questions
1.
What are your top-of-mind expectations for the fitness industry over the next 12-18 months?
2.
Can you elaborate on the rapid rise you expect in boutique gyms and how that compares to growth in HVLP [high-volume, low-price] fitness?
3.
What drives your confidence for rapid growth in the boutique segment in the coming months?
4.
Our experts in past Interviews [see Boutique Fitness Industry – North America Recovery Trajectory & Long-term Outlook – 25 September 2020] have suggested that roughly one-third of boutique studios might not outlive the pandemic. Do you believe that could still be a likely trajectory?
5.
What are your thoughts on today’s news regarding the Peloton Tread+ and Tread machines recall?
6.
What about Peloton’s acquisition of Precor and the opportunity in commercial fitness? Our experts indicated potential wear-and-tear issues if Peloton tried to enter the mass residential or shared gym and commercial segments because the equipment isn’t intended for high volume use. Do you think the Precor acquisition will help to resolve these issues?
7.
How do current membership figures for gym operators compare to December 2019 and March 2020?
8.
When do you think membership in the HVLP segment might surpass the December 2019 high watermark or March 2020?
9.
Which other core metrics have you been tracking in assessing gym operators’ different geographies and accounting for the different positions? Presumably it greatly depends on when gyms reopened, but what other metrics should be considered?
10.
Has the proliferation of COVID-19 vaccines created positive acceleration across the core metrics or a broader recovery?
11.
When we discussed membership rates across different geographies vs December 2019 and March 2020, did that include assumptions around membership freeze rates? Does membership still include numbers that are currently not being billed? What are the considerations around current billing rates vs pre-pandemic?
12.
Would the reduction in freeze rate translate or convert back to full-paying memberships?
13.
What would you highlight about gym usage and in what way could this indicate potential churn? Where does that fit today and what is your outlook on usage as a metric?
14.
What is your outlook for new members and joiners in respective demographics? How does it compare today vs earlier in the reopening phase?
15.
Which cohorts or demographics might not return to gyms in the current environment? How might this develop over the next six months?
16.
Could you outline the competitive landscape across different gym tiers? You suggested that growth might be limited for the high-end operators.
17.
Can you expand on the high-end competitive dynamics for Equinox vs Life Time Fitness?
18.
How’s the mid-tier competitive landscape shaping up?
19.
You say there’s still a future for the mid-tier segment with some very clear winners. Is there any additional M&A or potential consolidation to highlight for mid-tier?
20.
What’s happening competitively in the HVLP tier?
21.
Are there any considerations around Blink and potential cannibalisations from a trade-down effect during a possible economic downturn?
22.
What’s your take on the technology component? How might bricks-and-mortar operators’ app roll-outs be a tailwind or a headwind in the current environment? Has there been any impact on churn variability among members with the app vs without? Do you think Equinox’s Variis might impact churn for better or worse?
23.
You said an app potentially helps with retention but how significant is this impact? Would an app drive meaningful retention numbers?
24.
What other technologies could be significant drivers of member growth or retention? What technology trends have you been following when assessing membership metrics?
25.
What’s your medium- and longer-term outlook for gym operators? When might the HVLP unit growth trajectory return to pre-pandemic rates? How do your post-pandemic expectations compare to your pre pandemic assessment?
26.
When do we think HVLP systems overall might get back to 250-plus new units per year?
27.
Do you think average post-pandemic unit volumes might take a step change up or down for any reason? Could you outline any considerations and what the ultimate effect might be?
28.
What’s your overview on industry bankruptcies, agnostic to tiers? Are any players in potential distress?
29.
How do you think digital and the heightened awareness of at-home fitness solutions have impacted the HVLP gym segment?
30.
How do you think the broader adoption of digital fitness will impact the high-end and mid-tier gyms? Could it be more of a competitive threat and an issue for these operators?
31.
How are certain operators competing with Peloton and other platforms’ stickiness? Are operators taking any action to offset migration?
32.
What’s your take on gym CAPEX? When could equipment refreshes return for HVLP vs other segments?
33.
How flexible are franchisors being around CAPEX refresh cycles during the pandemic environment? Is there more leniency?
34.
What’s your longer-term industry outlook? Where do you expect the industry to be in five years?
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