The Fitness Industry Business Model

At the beginning of 2017, I launched a social experiment, branding myself as a fitness mom and started a blog at http://www.edanjoygelt.com. My brand wasn’t far from the truth – I’ve religiously worked out for decades and fitness has always been a part of my life, I just wasn’t an expert athlete. At the start of my experiment, my goal was to understand the impact of social media and obviously reap the benefits from the exercise but what I also gained was a lesson in the marketing and psychology of fitness.

A marketing strategist to the core, I was excited by what I learned and couldn’t wait to share.

Profit Model

It’s well known that the strategy behind the lucrative fitness business includes a monthly membership fee and attendance. The more people that sign up + the more people that don’t show-up = the more money the club makes.

This strategy has allowed many basic and full-service clubs to enter the market at varying costs and still be wildly profitable. Clubs may offer bare bones equipment with long hours or great classes and equipment with an assortment of amenities.

Each club prices themselves low enough and provides sufficient value that members don’t find it worthwhile to cancel when they stop showing to exercise. Basic gyms to locations with more amenities range from $10 per month to $90.

SEXperience

Enter the premium fitness experience; these clubs offer fitness to the “who’s who” of society (or those who want to be seen as such). Just belonging to these types of clubs makes the members feel fitter and sexier without evening taking their first class. The shear elegance and notoriety associated with membership demands a higher membership fee and delivers more amenities, better quality trainers and ancillary benefits such as fancy child care, pools with slides, etc.

These clubs offer exclusivity with a member tag of $90 – $200 per month.

Down, Dirty & Real

These are the mom-and-pop shops dedicated to fitness for whatever reason they hold dear (maybe they were a boxer, dancer, yogi) and want to share their experience and train others. They are typically located in commercial business districts where the rents are low and the space is plenty.

Value is in the trainers, owners and sense of community among students. These clubs/studios are about the sense of convergence and if done right, they are profitable, mostly affordable and targeted toward one area of expertise like CrossFit, Yoga, Boot Camps, etc. If they can excel in marketing, these business models survive and thrive based on reputation and referrals.

Memberships, class packages or drop in rates – or a combination there-of are offered. Prices average about $60 – $100 per month or about $15 a class.

Designer Duds

Newer to the market: designer duds. In the fashion world – designer duds are the hottest and trendiest gear. In fitness, these are the “popular kids” on the block and include chains like SoulCycle, Orange Theory, CorePower, Pure Barre, etc.

These are AMAZING CONCEPTS, don’t get the “dud” part wrong but there is something to that too. The clubs/studios are genetically engineered and optimized to mix the physical and mental component with SEXperience. Hyper-focused clubs such as these make fitness sexy, chic and popular. Each fitness experience is spun from a corporate web, which has spent mega bucks perfecting climate, fitness routine, music (even volume), and ambiance.

I call them designer duds for 2 reasons, one – they are super trendy and pricey, second – like fashion, they will likely over-franchise, lose authenticity in time and eventually fizzle (think True Religion Jeans) and live up to the “dud”. After all, how many years can you spin in a dark room without getting the itch to do something else?

I still haven’t figured out the lifecycle for designer duds but I don’t see them having a long-term foothold in the market. Memberships are priced from $150 – $200 a month, or $20 – $40 per class.

Future of Fashion Fitness

As more Designer Duds enter the market, the full-service SEXperience clubs are stepping up their game. They are changing their class offerings by emulating designer duds, offering smaller group training classes and enhancing private areas to provide a more intimate training experience.

It will be interesting to see what will survive and thrive and what will sizzle out in the next 5-years.

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5 Tips of Starting A Vacation Rental Business

A few years ago when the kids were young, we decided to invest in a summer home.  As big boaters, we wanted something close to a body of water but affordable enough to maintain year round.  Our first venture was a trailer, but due to the cleanliness of the lake it was on, cramped quarters, and only 5 Gallons of hot water, we quickly traded our trailer in for a home along a cleaner body of water

We ventured into Michigan and found a small quaint town.  We couldn’t afford lake side housing so opted for a little cottage a mile from the beach.  It was close enough to home but far away from reality.  As the kids grew, our ability to make it out to our summer home lessened so we decided to dive into the world of renting.  After interviewing several rental companies in the area, we opted to manage rentals ourselves to avoid the hefty 20 – 25% fee.

CONVERTING

If you are in the process of converting a vacation home into a vacation rental some changes need to be made.   Walk through your home and remove any valuable items you don’t want broken or removed from the property. Swap out family photos with artwork. Consider the linens – the quantity and even the color.  Whites may be easier to bleach but may stain easier.   Make sure you have back up towels and two sets of sheets for each bed for quick turnovers or when you don’t have time to have laundry done.

PURCHASING A VACATION RENTAL

If you are purchasing a new property, make sure the economics work. Research the area and figure standard rental rates and the length of the season.  In our case, our rental season is only 12-weeks long so we needed to make sure that renting made more sense than selling, we figured-in the cost of furnishing and updating as well as taxes and utilities.

Edan Gelt Vacation Rental Business
Edan Gelt Vacation Rental Business

LISTING

We chose to list our property on both AIRBNB and VRBO.  It takes a bit of coordination to make sure the websites are updated continually so if you rent on one, you need to make sure you block off the dates on the other

You need to create a powerful listing that captivates online viewers so treat the listing as a marketing tool.  Take great pictures and write an honest and detailed description of the property.  Include your distance from key destinations and any added value your property offers.  Research pricing of similar properties and price accordingly, taking into consideration fluctuations for holidays and peak travel times.

RESOURCES

Put a team in place.  Interview cleaning people, get to know your neighbors and find a local handyman.  If your vacation property is far from your main residence, your team is your most valuable resource.  During the summer, our cleaning lady becomes the go-to gal.  She lets us know if there is damage and turns over the property for the next guest in as little as 3-hours.   Our neighbors have also helped when tenants had issues like a new battery in a smoke detector or figuring out cable.  They even  notified us of a burst pipe in the winter.

TAXES

Make sure you pay taxes on your rental income, state dependent.  If you are a vacation homeowner and only want to rent less than 2-weeks per year, you can do so tax-free but anything more is taxable.

It does get a bit chaotic at times managing a vacation rental with schedules, tenants and but for us it’s been fun.

By:  Edan Gelt, MBA, CMD

FREE Versus Discount Marketing

As marketers we create and distribute promotional offers to drive traffic to our business, store and or/website clients – so what message really drives action?  What is valued the most, a loyalty program, discounting, buy one get ones?  How about FREE?

Everyone likes a discount but FREE comes out ahead when strategizing long term impact.  FREE not only drives consumers to take action quicker but FREE is a gift that keeps on giving.

The Law of Reciprocity

I wrote about the Law of Reciprocity in the past.  It is human nature to want to give back when one receives something.  So although it would seem that a FREE Bag of Dog Food at PetSmart, Free Slurpee Day at 7-Eleven or a FREE $25 Gift Card at Floor and Décor would cause these retailers to lose money, it actually has the opposite effect and increases sales.

I have been the recipient of all of the offers above and each and every time I have walked out buying an additional item (and I know the law of reciprocity).  I am so grateful to the retailer providing the free offer; I am intrinsically motivated to make an additional purchase (or I feel bad leaving without making a purchase).

Even if you’re not like me, feeling grateful enough to buy something, maybe you’re even guilted into it?  Ever try a sample at Costco and feel obligated to buy it afterwards?

According to a 2013 TIME Magazine article regarding 7-Eleven, my personal reaction of purchasing more after receiving something free is quite common. 7-Eleven’s Free Slurpee Day has resulted in ancillary sales increases of 40% or more in hot dogs, beef jerky and other snacks parable with an icee beverage.  It’s no wonder FREE Slurpee Day is an annual event.

Edan Gelt Marketing
Edan Gelt Marketing

Perception

Offering customers a discount does not relate as well as a FREE or bonus item, even if the value is the same.  In a study reported in the Journal of Marketing, writers Haipeng (Allan) Chen, Howard Marmorstein, Michael Tsiros, & Akshay R. Rao, note that when people were offered 33% more of an item versus 33% off the regular price, people actually picked the extra product, even though the discount was a better deal.  They learned that people’s perception of FREE or bonus outweighed the reality of the discount.

 Something to talk about

Not only are free offers good sampling opportunities but they also make great stories for the media.  FREE offers also make huge splash on social media.  People tend to share freebies.  If a famous sandwich shop is offering a free 6” sub and puts the offer on a social platform, it will go viral – driving swarms of people to the business location.  The promotion will also likely make the evening news.

By:  Edan Gelt, MBA, CMD

Interested in creating a strategic marketing campaign to increase sales?

Reach out at https://www.linkedin.com/in/edan-joy-gelt/

With more than 20 years of diverse marketing experience, including more than a decade at Harlem Irving, Edan Gelt has an extensive capability in diverse marketing mediums across various industries, offering insight on marketing strategy, research, public relations, advertising, special events, social media, direct marketing, branding and more.

Edan Gelt holds a Bachelor of Science degree in Marketing from Elmhurst College and an Executive MBA degree from the University of Illinois.

Marketing in Unfamiliar Markets

So a marketer for years, my main focus has always been on the good old Chicagoland area.  Recently, I welcomed a client which hosts events nationwide; in areas I’ve never even visited.

Most of the events were repeats so there was a trail of what made up the primary demo – emails, zip codes, income and how attendees heard about the event; but what about new events in entirely new markets?

Understanding what marketing mediums have worked in other markets for similar events, I approached the new area with the same strategy basics, however, finding the most value in each new outlet was challenging.  My first goal was direct mail and mass distribution magazines, so I searched all direct magazine/mail suppliers in the area.  After receiving media kits from several companies, I sifted through the marketing publications looking for similar businesses.  Then I picked up the phone and called the businesses one by one to ask for opinions.  It was a very long day.

Business owner after business owner rated the publication I was calling about and told me how they rated the return. They also referred me to other sources and even introduced me to other companies in the area that might make good media partners for the event.

Marketing By Edan Gelt
Marketing By Edan Gelt

It was a tedious process, but outside of living in the area, this was the best approach to understand what publications reached my demographic.  I also learned a lot about the demographic.  For most businesses, a trade area really isn’t a circle but instead, an amoeba.

From my calls to the businesses, I learned more about exactly what zips to hit so I could create a valuable digital and mail campaign.  Instead of going in blind, I was educated and confident before writing recommending a media plan.

The event campaign was a success and the client was able to get more than 1 million impressions for a substantially lower CPM than budgeted. We created valuable long-term partnerships for the event and created a viable and sustainable campaign.

Even in the US, the culture in each market varies and what works in one state or even city, may not work in the other.  My advice, roll up your sleeves and start making calls – understand where you’re going and how to make a splash.

By:  Edan Gelt, MBA, CMD

With more than 20 years of diverse marketing experience, including more than a decade at Harlem Irving, Edan Gelt has an extensive capability in diverse marketing mediums across various industries, offering insight on marketing strategy, research, public relations, advertising, special events, social media, direct marketing, branding and more.

Edan holds a Bachelor of Science degree in Marketing from Elmhurst College and an Executive MBA degree from the University of Illinois.

For more information visit www.edangelt.com,

or https://www.linkedin.com/in/edan-joy-gelt/

What is Retargeting and How Does It Work?

Have you ever looked for something online to later find the thing you were looking for following you everywhere on the web?  I remember the first time this happened to me, I thought it was a coincidence or maybe a “sign” that I really should purchase that skirt, those cool shoes or take my kids to that cool new play zone.

The ads weren’t a coincidence but instead, directed directly at me based on my Internet activity.  The process is called Retargeting and it is one of the more effective digital advertising channels.

How Retartegeting Works

A small piece of code (also called a pixel) is inserted in a web page, landing page, or email.  The user does not see the code but the cookie-based, java-script technology secretly follows the user around the internet and serves up ads based on behavior.

The most unique aspect is that the code can be delivered based on the buyer’s behavior.  If a potential customer visits your site, loaded up a basket and didn’t check out, the item(s) can follow the customer around.  Or if the potential customer just looked at an item on your site, you can still serve up ads.  The code is customizable based on consumer behavior.

Retargeting Ads Edan Gelt
Retargeting Ads Edan Gelt

Retargeting is extremely effective because it serves up targeted ads to a market that has already shown interest in your product or service.  This makes retargeting ads more effective than other digital channels based solely on demographics.

Interested in creating a retargeting campaign?  Reach out on Linkedin.

By:  Edan Gelt, MBA, CMD

With more than 20 years of diverse marketing experience, including more than a decade at Harlem Irving, Edan Gelt has an extensive capability in diverse marketing mediums across various industries, offering insight on marketing strategy, research, public relations, advertising, special events, social media, direct marketing, branding and more.

Edan Gelt holds a Bachelor of Science degree in Marketing from Elmhurst College and an Executive MBA degree from the University of Illinois.

Direct Mail Marketing

Contrary to its pricey reputation, direct mail is an effective and AFFORDABLE way to market. Affordable was never a word attributed with direct mail but now it is one of the more cost effective mediums of messaging. When digital options first emerged, advertisers could reach consumers for pennies, which made direct mail seem like a fortune.

Times have changed and the cost of digital can range from a few cents to upwards of $20 for an impression. In addition, the digital environment is so saturated with pop ups, banner ads, sponsored feed and in-mail junk, consumers have become desensitized to the digital clutter appearing on their screens.

Enter the comeback of direct mail – or for some marketers (like me), it has never left.

Direct mail, when implemented correctly, can be the most impactful way of causing consumers to take action. At direct mail’s average bulk cost of $0.35 apiece, it is an affordable way to capture attention.

So how is a good campaign established?

Target Market

Look at your CRM or your research. Establish whom your key customers are, what they look like (age, income, geography, etc.).

For consumer retention, use the list from prior targeted purchases. Specific lists may cost a little more in postage than bulk but it’s worth retaining previous purchasers.

For consumer acquisition, you can purchase a lists by specific attributes of each recipient or by carrier routes that have the qualifiers you are looking for. Usually, the more specific your list: the higher the postage rate. There are also shared mail programs like DAL cards offered by publications. DAL-like cards are cheaper (sometimes as low as $0.10 for print, prep and post) but you don’t get the freedom of choosing your target market qualifiers.

Timing

Target your customers when they are buying. Look at your sales reports. When are your highest sales? This is the time your consumer is buying so this is the time you should be targeting them. Timing varies for different products and industries.

Message

Determine what it is your consumer values; then offer it. If you can afford to customize your message to each recipient, do it. If not, that’s okay too. Whatever you do, keep your message simple and make the headline appealing and relevant.

If you are a restaurant offering a free appetizer, make it pop. Don’t bury the offer in small writing amongst all the other entrees you are offering. Keep your offer clean, concise and engaging.

Edan Gelt DIRECT MAIL MARKETING

Design

Nothing is less appealing than receiving a mailer that has a ton of tiny images with small text telling the consumer everything about your business. I recently received a mailer with a message for deck cleaning, lawn care, painting, lighting and windows all on one 5×8 post card! That’s great if your company offers all of those amazing services but too much information and pictures can be overload and garbage material. Look at your sales – which service or services are the most popular? Feature the top one, maybe two.

Consistency

One mailer is not the answer to all of your marketing needs. Consistency is key and the rule of thumb is three times is a charm. It takes three impressions for a consumer to make a decision. You can reach out three times via direct mail or you can mix up your marketing mediums – maybe email, mail, engage them on social, or pay for the creepy ads that follow them around the net.

Direct Mail can be a profitable marketing strategy if done correctly. The recipient has to look at your offer and register it before deciding to keep or toss your piece. That holds a lot of value in today’s cluttered digital environment.

By: Edan Gelt, CMD, MBA
Edan Gelt is an award winning, innovative, energetic, highly creative and consumer-centric marketing leader with successful results in increasing sales and traffic.

Her experience includes business-to-business and consumer marketing, advertising, media-buying, branding, e-marketing, public and community relations, strategy creation/implementation, budgeting, direct marketing, grand openings, trade shows, grass-roots marketing initiatives and special event planning.

Originally posted on : http://edangelt.com/post/161761924421/direct-mail-marketing

Feel the Fear and Do it Anyway

“Miracles are just a shift in perception from fear to love.”, Marianne Williamson

Five years ago, my 4-year-old daughter was diagnosed with Leukemia. At the time, I was working full time and running a side business, while my husband and I also managed property and he worked full time. We had a lot going on and the diagnosis was like being hit by a freight train.

I remember the fear in the hospital as we sat up all night, discussing what the long-term prognosis could be and what our lives as a family would look like. I had all these balls in the air and for the first time, I was okay if all my projects crashed around me; everyone would understand – my baby had cancer.

Day two, or maybe it was day three of our hospital stay; my husband and I sat whispering over our daughter. I’m not even sure what we were saying but she grabbed my hand and said something about it being okay.

My mother used to quote “Feel the Fear and Do it Anyway”, by Susan Jeffers. She died 11 years before my daughter was born and I never truly understood what she was quoting until then. We felt the fear and we put on our grownup pants and moved forward, each action at a time.

The next few months passed and we learned a lot about what it took to keep moving when the world seemed like it was falling apart. Thankfully my daughter survived her 2.5 years of chemo and we kept up with all of our crazy activities. We were often asked “how we did it”, by friends and family – and the truthful answer was “we had no choice”.

 Edan Gelt Feel the Fear

Looking back, we did have a choice. We chose to live and here are some basic tips from our journey:

REMOVE NEGATIVE PEOPLE AND SITUATIONS

Run, don’t walk. Remove yourself from situations and people that cause conflict. Life deals us enough stress without being sucked in by energy vampires. Energy vampires believe their happiness comes from your lack there of. If you want to succeed in life, do the best you can to rid your world of these people. Usually taking a break from negative people and situations will give you perspective. Get rid of the drama.

STAY FOCUSED ON WHAT MATTERS

Make a list. On one side, right down what you need to get done now and on the other side, what you need to get done long term. Don’t get distracted by stuff not on the list, or stuff that doesn’t require immediate attention. I used a journal and a white board to keep me on task.

Edan Gelt’s Marketing as a Game of Chess

KEEP IT SIMPLE

Have a routine that doesn’t suck the life out of you. Include family time, a workout and a time for self-reflection. The busiest person doesn’t mean the happiest person. Schedule the simple stuff, like reading with your kids, a date night with your partner or even a nap. This way you give the people who matter most the same attention as you give menial chores or office work.

TAKE CARE OF YOURSELF

On an airplane, they always say “put the breathing mask on yourself before assisting others”. What is the importance of this? If you are helping someone else breathe before you’ve helped yourself, it is likely you could pass out trying to help and wind up being no good to anyone. Get some rest, take a shower, exercise, pamper yourself. When you are taken care of, you have more to offer the world. Besides, you just feel better about yourself when you approach the day.

JOURNAL

This is not an assignment but an outlet. It’s a way to release your emotions when it is 2am and the never-ending to-do list is flashing like a neon sign. Make a practice of writing just a bit each day and journaling when you need to. Write about things you experience – it could be aggravating situations, things that made you laugh, achievements you are proud of – whatever it is that comes to mind. This is your private place so go for it.

MEDITATE AND READ

Interesting that these two are combined? I’m awful at clearing my mind which likely means I need some yoga or meditative practice ASAP. However, when I just can’t get to yoga (my effort is poor) or get myself to sit still long enough to meditate, I read. I read something that is entertaining. It takes me to another place and lets me escape my mind long enough to reset it. Reading is my escape from my racing mind.

SURROUND YOURSELF WITH POSITIVITY

This is huge. It’s not fun to be the smartest or happiest person in the room. Find a group you can learn from. For me, it was moms whose kids survived cancer or women who made it big in their career. I work on surrounding myself with people I can learn from, people who inspire me; people who inspire me to be better.

What do you do to keep moving forward when life gets hard?

By: Edan Gelt, MBA, CMD
Marketing Strategist, Child-life Volunteer, Change Agent
https://www.linkedin.com/in/edan-joy-gelt/