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Poised For Expansion The Future Of The Fitness Industry
300% Growth In 10 Years ?
@BryanKORourke, CSO, CEO, Principal Houston Golds Gym, FIT-C, Vedere Ventures
bryankorourke.com
bryankorourke.com @bryankorourke
GREATEST TIME IN HISTORY TO BE IN OUR INDUSTRY
AND BUSINESS AS USUAL IS DEAD
HOW WILL YOU RESPOND ?
MY STORY STARTS IN 1983
1993
I INNOVATED ACROSS INDUSTRIES
1996
INTRODUCED AUTOMATED ESPRESSO
1997 GOT INTO HEALTH CLUBS
2005 GOT INTO GROUP FITNESS
STARTED INNOVATING AGAIN 2006 #TheCloud
AND AGAIN 2007 @bryankorourke @GaryVee
PAST 10 YEARS ENTERED AGE OF ACCELERATIONS
2016
http://www.fittechcouncil.org/podcast/
WE KEEP INNOVATING
GROWTH REQUIRES INNOVATION
1 BILLION MEMBERSGROWTH REQUIRESDISRUPTION
SAPERE VEDEREDA VINCI TO KNOW IS TO SEE
RISING TIDES LIFT ALL BOATS
DISRUPTION IN THE ERA OF MASS ACCELERATION
DISRUPTION EXAMPLES : RESTAURANTS OFFER A
DINNING EXPERIENCE
THIS OFFERS A DINING EXPERIENCE
BANKS OFFER FINANCIAL SERVICES
THIS AI OFFERS FINANCIAL SERVICES
CONCERTS OFFER MUSICAL ENTERTAINMENT
THIS APP DOES THE SAME
THIS CLINIC OFFERS MEDICAL CARE
THIS APP OFFERS MEDICAL CARE
HEALTH CLUBS OFFERHEALTH & FITNESS EXPERIENCES
DISRUPTION: THIS OFFERSHEALTH & FITNESS EXPERIENCES
DISRUPTION: THIS OFFERSHEALTH & FITNESS SERVICES
THIS OFFERSHEALTH & FITNESS EXPERIENCES
DISRUPTION: THIS OFFERS FITNESS EXPERIENCES
AND SO DOES THIS
INDUSTRY DEFINITIONS HAVE CHANGEDTHE LINES ARE BLURRED
WHAT ARE FITNESS EXPERIENCES BECOMING ?
HOW WILL THE INDUSTRY EVOLVE ?
WHAT WILL MEMBERS REALLY WANT ?
HEALTH CLUBS HELP PEOPLE GET HEALTHY & FIT. . AND
WEVE ENTERED A NEW ERA
YOU MUST APPLY FRESH THINKING TO REACH MARKET POTENTIAL
PEOPLE TECHNOLOGY
GLOBALISM ECONOMICS
DISRUPTION BY CONVERGENCEOF TRENDS
PEOPLES BEHAVIORS
HEALTH & FITNESS INDUSTRYCONVERGENCE DRIVERS
Old school definitions dont apply - dizzying diversity
Bifurcation : mass affluence driving niche luxury models and middle class driving utility businesses.
Urbanization : cities are driving global growth and represent the majority of health club operations.
48
Power has shifted to fitness consumers Exane : 10% luxury is digital now 40% by 2020
3 CONSUMER TRENDS
G R E AT E R U T I L I T Y A N D C O N V E N I E N C E & R E L E VA N C E F O R
U S E R S
PERSONALIZATIONA C K N O W L E D G E M E N T A N D
R E C O G N I T I O N E M B R A C I N GA M I S S I O N
ENGAGEMENT
FLAUNT CULTURE
NOT JUST FITNESS
BENEFICIAL INTELLIGENCE
N E W WAY S O F D E L I V E RYT H AT I N C R E A S E U S E
A N D R E L E VA N C E
SERVICE REDEFINITION
OMNI-PRESENCE
TRENDS + VISION = REINVENTING MODELS
3 KEY CONSUMER TRENDS
PERSPECTIVE SHIFT
STATUS
Personalization: greater utility, convenience & relevance
BENEFICIAL INTELLIGENCEEnhancing User Experience ThroughBuilt In Intelligence
OMNIPRESENCENew Channels, Nuanced With Context In The Right Place At The Right Time
Personalization is hard
Engagement: acknowledgement recognition mission
STATUS:Experiences Via Design, Gamifying, UX, Community
FLAUNT CULTUREAllow Users To Remove Barriers And Celebrate And Flaunt An Authentic Transparent Experience
Service redefinition : delivering new and different
PERSPECTIVESHIFT:Reposition Renew, and Refresh Service Offerings In New Ways
NOT JUST FITNESS:Lifestyle, Mindset, Nutrition, Holistic, Longevity
G R E AT E R U T I L I T Y A N D C O N V E N I E N C E & R E L E VA N C E F O R
U S E R S
PERSONALIZATIONA C K N O W L E D G E M E N T A N D
R E C O G N I T I O N E M B R A C I N GA M I S S I O N
ENGAGEMENT
FLAUNT CULTURE
NOT JUST FITNESS
BENEFICIAL INTELLIGENCE
N E W WAY S O F D E L I V E RYT H AT I N C R E A S E U S E
A N D R E L E VA N C E
SERVICE REDEFINITION
OMNI-PRESENCE
TRENDS + VISION = REINVENTING MODELS
3 KEY CONSUMER TRENDS
PERSPECTIVE SHIFT
STATUS
CONSUMERS TECHNOLOGY
GLOBALISM ECONOMICS
4 HEALTH CLUB INDUSTRYCONVERGENCE DRIVERS
HEALTH CLUB INDUSTRYCONVERGENCE DRIVERS
TECHNOLOGY
P H I L O S O P H Y O F E . O . W I L S O N
W E H AV E PA L E O L I T H I C E M O T I O N S , M E D I E VA L I N S T I T U T I O N S A N D
G O D - L I K E T E C H N O L O G Y65
@Bryankorourke @Kevin2Kel lyFREE COPY OF THE BOOK
The greatest products of the next 20 years have not been created yet.
Kevin Kellys View Of What Will Happen With Technology12 Inevitable Forces
68
01 Becoming 02 Cognifying 03 Flowing
04 Screening 05 Accessing 06 Sharing
Move from fixed products to constant upgraded services and
subscriptions.
Make everything smarter via cheap AI from the cloud.
Unstoppable streaming. You are certainly now in the data
business.
Turning all surfaces into screen experiences.
Access to services at all times move away from owning assets.
Mass-scale collaboration. Key innovations built on sharing.
BE CO FL
SC AC SH
SCREEN
SCREEN
AC & CO
12 Inevitable Forces
72
07 Filtering 08 Remixing 09 Interacting
10 Tracking 11 Questioning 12 Beginning
Harnessing intense personalization to anticipate
desires.
Unbundling products and basic parts and recombining them in all
possible ways.
Immersing ourselves inside computers to maximize
engagement.
Total surveillance for consumer and citizens benefit.
Promoting good questions is far more valuable than good
answers.
A system connecting all humans and machines in a global mix.
Kevin Kellys View Of What Will Happen With Technology
FI RE IN
TR QU BG
CYBER PHYSICAL SYSTEM : THE HOLOS
CONSUMERS TECHNOLOGY
GLOBALISM ECONOMICS
4 HEALTH CLUB INDUSTRYCONVERGENCE DRIVERS
CONVERGENCE DRIVERSECONOMICS
CONVERGENCE RESULTS IN DIVERGENT MODELS
New Delivery Systems
Profit Margin
Dupont Formula : Return On Equity
78
EBITDA
SALES ASSETS EQUITY
SALES ASSETS
Asset Turnover Equity Multiplier
X X
Profit Margin
Dupont: Return On Assets Where the Growth Is
79
EBITDA
SALES $3M AVG
SALES $3M AVG
Asset Turnover
X =53% 100% 53%
Profit Margin
80
EBITDA
SALES ASSETS $1.6M AVG
SALES $1.6M AVG
Asset Turnover
X =34% 100% 34%
Dupont: Return On Assets Where the Growth Is
8 Distinct Fitness Delivery ChannelsHealth Club Models
82
High End Full Service
Middle Market
Low Price HV Boutique
Full Service, Full Amenities, Higher
Prices, Digital Integration
Financially Challenged, Low Pricing Power,
Legacy Burden
Hi-Growth Space, Low-Cost, Low-
Service, Upcoming Digital, Lower Markets
Program Focused, Cross Over Lifestyle,
Multiple Monetization, Omni-Channel
Health Club Models
83
Lifestyle Community
Pure Digital
Medically Integrated
Alternative Models
Outdoors, Indoors, Lifestyle. Connection,
Data Driven, Streaming Content, Anywhere
Anytime,Home Market and More
Outcomes Based, Integrated, Population
Health
Corporate, Multi-Family, Alternative
Models
8 Distinct Fitness Delivery Channels
Business Models Will Merge Different Aspects Of Each Of These With ALL INCLUDING DIGITAL COMPONENTS
Merging Of Offerings - Key Digital
84
High End Full Service
Community Digital Medically Integrated
Middle Market Low Price High Value Boutique
Alternative
OLD MODEL OF VALUE
CU
STO
MER
S
TRANSACTIONS / $
IE: Valuable Companies
NEW MODEL OF VALUE
REC
EPTO
RS
COGNITION
IE: New Valuable Companies
CHALLENGE IS NOT THE TECHITS PEOPLES MINDSET
Good News : A Growing Market: sick care is not sustainable and public primary prevention is the answer. Technology will help. #PassPhit
Personalized Primary Prevention Is Here - Your DNA
S CURVE REINVENTIONTHE PATH FORWARD
HERE WE ARE : CONSOLIDATION AND REENGINEERING - S CURVE
91Bricks & Mortar Biz ModelsKey Driver Is Profitability
DIGITAL OMNICHANNEL MEDICAL BOUTIQUE LIFESTYLE COMMUNITY
HEALTH & FITNESS INDUSTRYCONVERGENCE DRIVERS
GLOBALISM
100,000 Yrs. Ago, 6 Dif ferent Human Species Inhabited Earth - Cooperat ion Key
How we operate and invest must be mindful of sustainability
We must cooperate globally to impact policies that address the huge risk and opportunity of global health
We must globally share our insights and cultural diversity to drive innovation and success
HOW WILL YOU RESPOND ?
OBJECTIVE QUESTIONS
DESIGN ENHANCED PROFIT
UX OMNIPRESENCE SERVICE SCOPE
CLUB OPERATORS FOCUS
TOOLS & RESOURCES@IHRSA @FITTECHCOUNCIL @BRYANKOROURKE
S CURVE REINVENTION
FORWARD LOOKING PLAN
Poised for growth Disruption Will Make Our Industry Better
SAPERE VEDEREDA VINCI
PEOPLE TECHNOLOGY
GLOBALISM ECONOMICS
4 HEALTH & FITNESS INDUSTRYCONVERGENCE DRIVERS
The greatest products of the next 20 years have not been created yet. Kevin Kelly
HEALTH & FITNESS INDUSTRYCONVERGENCE DRIVERS
GLOBALISM
bryankorourke.com @bryankorourke