How Health Clubs & Gyms Can Tap The Full Potential of Retail To Boost Non-Dues Revenue
If you are a club operator, you already know how important Retail can be to your business.
The only question is: Have you already tapped the full potential of Retail in your health club and gym?
Why is tapping the full potential of Retail important for you:
It leads to increased member engagement. According to a study by Club Industry, on an average, health club members who purchase retail products spend 30% more on their memberships than those who do not. This underscores the importance of having a compelling retail offering.
- Studies show that on average, health club members who purchase retail products spend 30% more on their memberships than those who do not. This underscores the importance of having a compelling retail offering.
- As per an IHRSA report, health clubs with a well-implemented retail strategy can see retail sales account for up to 20% of their total revenue.
This blog will make a case for examining your health club retail business today and give ideas, best practices and examples to help you craft an effective retail strategy and boost your non-dues revenue.
Key Benefits of having a Retail Strategy
A new revenue stream
This is the most obvious. A new and additional revenue stream beyond membership fees and services, helps cushion the fluctuations in membership numbers and seasonal dips in dues. The more varied your revenue streams, the more stable your overall cash flow.
Quoting from Club Solutions magazine, Jon Brady, the president of Midtown Athletic Clubs, says that their retail stores are key to the area’s role as a viable profit center. “The retail stores are profitable in all our facilities,” shared Brady. “They all run about a 25% profit margin.”
A richer member experience
A beautifully designed retail space with curated offerings will definitely elevate your member experience. Convenient access to the right fitness apparel, accessories, and equipment can also support members with their fitness goals. Health clubs that offer a well-curated retail selection report a 15% increase in member satisfaction scores, according to a study by Club Industry.
Quoting from Club Solutions magazine: Brittany Yaworski, the retail director of Rochester Athletic Club “We want them feeling great both inside and outside of the gym,” said . “Whether our members are looking for a special occasion outfit, something trendy for date night, or just need new shoes, socks or a racquet to get through a workout, we have them covered.”
More footfall
An attractive and well-stocked retail space can attract both members and potential customers, driving more footfalls into the club and potentially leading to increased membership sign-ups. According to IHRSA, Clubs with retail offerings see a 10% rise in member visits beyond workout sessions, as members are more likely to visit the club to shop for fitness products and apparel.
Build a distinct brand identity
Your members who love you will love to wear your brand colors and logo in their T shirts, sweatshirts and sip coffee in your branded sippers. That is because products with a distinct identity help people feel a sense of belonging. Branded products and unique offerings help establish a strong brand identity and position the club as a special, warm and engaging space.
In fact, Health clubs that align their retail offerings with their brand values experience a 30% increase in member loyalty, according to a study by Mindbody.
Build connection and community
If done right, your retail space is likely to become another opportunity to connect with your members. For example, if a senior member is looking for a comfortable pair of shoes, and your staff can guide them on that purchase, maybe even source it for them. It might even become another place for members to hang out every other day with their buddies while exploring products and making plans to buy in future.
What can your Retail offerings include?
Does the idea of Retail bring up an idea of an athletic and swim gear store? But, it does not have to be limited to that. Today your retail offerings can have an extensive range from workout gear to shoes to supplements to smoothies. You can start with some and add others slowly.
Pro Shops
Retail outlets offering a range of athletic wear, workout clothes, shoes, and fitness accessories are the most common offering. Brands like Nike, Adidas, Lululemon, and Under Armour often have dedicated sections or stores within health clubs.
Supplement Shops
These stores sell nutritional supplements, protein powders, vitamins, and other health-related products. GNC (General Nutrition Center) is a well-known example that often has locations in or near health clubs.
Smoothie and Juice Bars
Offering healthy and refreshing beverages, these bars provide post-workout options for members looking to refuel. The importance of these cannot be overstated – anyone who has come out of a grueling workout is forever grateful for a healthy smoothie. And so offering these is the easiest way to build a true connection with your members. Examples include Performance Foods and local smoothie bars. Further, ordering and managing the orders of the Smoothies is simplified with digital solutions, like the SHC solution for Smoothies.
Yoga and Fitness Equipment
With the number of people adopting yoga today, and a whole category of products catering to them, stores that specialize in selling yoga mats, resistance bands, dumbbells, and other fitness equipment can cater to them. Manduka is a popular brand in the yoga equipment space.
Health and Beauty Products
Retail spaces offering skincare, body care, and wellness products that align with the health-conscious mindset of health club members.
Wearable Technology
With the rise of wearable fitness trackers and smartwatches, some health clubs have partnered with or hosted retail spaces for brands like Fitbit, Apple, and Garmin.
Recovery and Relaxation Centers
These retail businesses might offer products like massage tools, foam rollers, compression sleeves, and recovery equipment to help members alleviate post-workout soreness.
Nutrition and Healthy Snacks
These shops offer a variety of healthy snacks, grab-and-go meals, and nutrition-focused products that align with the health club’s wellness goals.
Local Artisans and Brands
Health clubs might collaborate with local artisans or health-focused brands to offer unique products that resonate with their members.
Tips to maximize retail success in a club environment
Once you have decided to set up your retail space, there are some proven methods and tips you can use to make it a success.
Make the retail space part of an essential path – either entry or exit
Draw inspiration from Disney World’s exit-through-the-gift-shop concept: Position your retail store prominently and design the space to naturally guide members past it. You could also craft a sense of arrival for members by integrating the retail store as an integral part of their “arrival experience”, encouraging anticipation.
Give them what they want and take the time to educate them
Look at your customer segments deeply and take the time to understand what they need and want. Use simple tools like questionnaires, interviews to understand their expectations. Think like a member and identify what prompts them to make purchases. Apply these insights to your club’s retail strategy to resonate with your members.
For example, if you have a sizeable senior population, you can stock brands like Brooks or New Balance and advise on or offer add ons like Powerstep inserts or a support socks from Vitalsox. Here the key also is the education and advice you give members.
Be the Style Guru. Be different
Keep your collections on trend and on point. You should become the fitness style guru for your members. Bring them the latest and greatest. Instead of only big brands, introduce your members to smaller, local brands, too. Today with the rise of Instagram brands, there are local gems in every city.
Brand Events and Local Retail Integration
Host events to promote new product releases from brands, creating a sense of excitement and exclusivity. Collaborate with local retailers to introduce new energy and diversity to your club’s retail offerings. You might be surprised to know that clubs that host retail-related events, such as product launches and shopping nights, see a 15% rise in member attendance. (Source: Association of Fitness Studios, “Creating Community through Retail Events,” 2021)
Reward the work put in by your members
Acknowledge that after a challenging workout, members seek a reward. Some even see shopping as Retail therapy. Position your retail store as an avenue for fulfilling this desire.
Staff as Brand Ambassadors
Showcase featured apparel by having your staff wear it within the club. If you have your own branded products, maybe every staff member including club management can wear their own T Shirt or Sweatshirt. This will promote products and build a consistent brand image.
Go online and offer an purchases
Once you have a good range of retail offerings at your club, you can offer them via your website too. Showcase your catalog on your club’s website. In addition, add the same catalog to your club App and enable purchases via Purchases. This is especially beneficial for larger clubs with multiple locations.
Some retail items are riskier than others
Keep in mind that selling some retail items such as shoes is a very risky and costly proposition for a Health Club: How many of each size and half-size; colors; styles; The inventory you must carry and the competition from stores like Dicks Sporting Goods, Big 5, etc. Then, there are the returns and restocking.
Manage each revenue stream separately
Each stream whether it is smoothies or the Pro Shop or the Supplements kiosk – you should track their revenue performance separately so you can keep an eye on how each is performing.
Create a retail strategy and not jump into anything and everything
Adding retail options for your members at the club with curated offerings adds value to the member’s experience. But, what you need is a well thought through retail strategy. Instead of jumping into every conceivable retail business. For example, you might want to start with Nutraceuticals and Smoothies.
Market everything you have – Advertise and Promote
Many clubs don’t promote their camps or programs well enough, especially digitally. Same applies to Retail. You might have all these retail offerings, but unless you’re promoting them well, your sales will suffer. To do this well, you need a digital marketing solution for running campaigns across different channels – club app, email, push notification especially if you are running any special promotions/sale.
Summing Up
Retail is important for your members and has business potential too. There are ample and diverse retail opportunities that you can consider and create a retail strategy for your club.
We would love to know what you think! If you want to brainstorm on this sometime, feel free to reach out to us and we would be happy to have a call.
