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Running a CrossFit Facility Tips and guidance on how to open and operate a CrossFit gym.

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Old 03-28-2016, 04:53 PM   #1
Sean J Hunter
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Affilate growth ground to hault - market stauration?

We have been putting some energy into a longterm market analysis tool, wanting to read our market as it moves on an on-going basis.

Now most of this stuff is owned by the company so I can;t share it, but would really love some thoughts on this follwoing.

It appears affilate growth has ground to a hault worldwide. 12 months ago it was around 300 gross affilliate growth / mth, now its around >80

Now this is Gross Affilate growth, it doesnt account for death rates. It's just total world wide affailte increase.

There could be multiple reasons for this, I'd be interested in thoughts.

1 - So it's that maybe HQs still getting 300 / month but there's a huge death rate, word on the street is this is happening in the Australia market big time. Classic market saturation means boxes without good marketing or retention startegies can no longer compete well, and membership slwoly drops below break even point.

2 - Or it may be that the market is flooded and people are shying away from opening new boxes. I have rubed sholders with alot of box owners, and I feel it's fair to say few have the professional experiance to really gather or understand the information to know if their market is flooded, so most are still opening with little understanding of their local market conditoins.

Also define flooded, traditional advertsing, (open the doors and they will come) is surely a failed strategy in most areas, where as strategic thoughtful prospecting, matched with excellent value delivery will still likely work, its unlikely that one prospective client has a close friend in two different CrossFits - aka Refferal selling.

3 - It could also be HQ has cracked down on affiliation? I'm hearing they now do a phone call with each applicant. And their not just accepting every affilaition. Rumour?

4 - Or worse case, boxes are still opening all over the place, but just not affilating, I think this is unlikely. In most situations, $3000 for brand usage is more than worth it. attract two clients and its paid for itsself.

A little on point 4. here in NZ, we got some marketing interns to do some pretty damn good market research, becuase there is zero brand control spending in NZ, I don't beleive any CF here get together and control brand, the only person contrlling brand here is the media, and it generally aint good.

The CF brand is really damaged here. For example, when asking in a street survey the first three words that come into a target demographics head, when told "CrossFit"....go. The answers revolved around unsafe, fanatic, and not for me.

We did something similar in the US with a buddy of mine, not quite as detailed, and the numbers are still coming in but the answers where more, "I don't think I'm fit enough to do it". Two VERY different objections to overcome. Overcoming brand damage is one thing compared to just showing people its for unfit people too.

Anyway, just some meandering thoughts from a startegic marketing guy with some numbers.

Love to hear thoughts

I know many of you can't register on here any more, getting others thoughts is super valuable, if you wanted to enter into a discussion, feel free to email me at sean@basesc.org.nz. No we're not affilated yet, we're still doing our soft open. We're affilating later this year.....if HQ will have us. :P

Sean

Last edited by Sean J Hunter : 03-28-2016 at 05:57 PM.
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Old 03-31-2016, 06:48 AM   #2
Sean J Hunter
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Re: Affilate growth ground to hault - market stauration?

Gawd I do appologise for my spelling, was on a train, on my phone.

S
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Old 05-18-2016, 11:47 AM   #3
Victor J McQuaide
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Re: Affilate growth ground to hault - market stauration?

Agree with this.. so many going out of business or selling cheap to someone who can re vamp them.

Some smaller gyms popping up with little chance to survive IMHO. The just give it the old college try is not working either.

I have been to a lot of gyms training and always try to find out the secret sauce.

I believe the most successful gyms are the ones who have the following:
1) An owner or owners who are deeply invested and are around all of the time.
2) Structure, Structure, Structure.. Group warm up, everyone doing the same thing, people cooling down after.
3) Branding and more branding
4) Keep people around before and after the class is over. See CF Belltown in Seattle. Most unique and best gym I have been to.
5) Leaves a stamp on people and the member leaves the box positive time each and every time.


The days of when you just put Crossfit Forging Elite Fitness on the side of the building and you fill it instantly are over.

The days of members putting up with sub standard equipment, coaching and facility are less and less.

WTBS: I am opening up a gym next year but will be bringing 25+ years of business ownership plus other key people who are very skilled in what they do.

You have to make money if you open a gym. Your mission statement is very important. All good members want you to make money.

Facts are that you have to put a desirable product and maybe be a little better than the people around you.

Affilated or not? That might be the question. I know a wildly successful gym that is not affiliated and people don't seem to care. Problems with un affiliated during crossfit open you have to take the members to another gym to do workouts or film to score. Can't use the words Crossfit which could be good in places also. A friend of mine does a class called Crossfit-Lite.

I am looking into building a super box one day but want to get my feet wet while helping out a friend of mine with marketing and monetizing the place this year. Next year opening up my gym. Then in 3 years doing the big one with my present partners and also my daughter who is in a private college studying business.

I believe some day sooner than later it will be the mom and pop boxes and the large mega ones. Not much in the middle. To be honest I live both of them. Maybe to hedge my bets will keep the small boutique one and have the large one also. Each member can go to each of them. Its nice to get a change. I go to 4 local gyms per week. Maybe x fit chains will open.

Anyone watch Bar Rescue.. a guy goes in to a failing bar and fixes up the place, processes and people. Seems that X fit owners should have a stake in helping the boxes that struggle stay in business.

Crossfit is kind of a company who sells franchises in a way and doesn't visit them or help them that much. Maybe some day they will have staff that goes around and fixes up the places and tells them what works. We will see.

So far they have 13k plus giving them money each year so they don't have to worry about the lose change on the ground. They are super busy picking up the $1,000 bills.

Good topic Sean
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Old 06-03-2016, 08:56 PM   #4
Shay Coleman
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Re: Affilate growth ground to hault - market stauration?

Crossfit affiliates or any business that grows so far so fast is going to have a natural slowing point.
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Old 07-08-2016, 12:15 PM   #5
Victor J McQuaide
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Re: Affilate growth ground to hault - market stauration?

The saturation with the market or just plain don't have money, time or skills to run the box is running fast in our market right now. Have many gyms looking for help or just trying to find solutions to get out of their long term expensive lease.

HQ should have a show Box Rescue. Go around to failing boxes and train, spruce up the place, out fit with great equipment.

We are 5 years past the point of open Forging Elite Fitness and they will come by the droves.

I wish everyone success in this crazy world.
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Old 08-21-2016, 12:30 AM   #6
Faris Hammadi
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Re: Affilate growth ground to hault - market stauration?

Thanks Sean for posting this;

I live in a City called Sharjah in the Middle East; It's near Dubai, UAE.

I have done a market Research, focus groups, surveys and found out the same results as above about CrossFit:

CrossFit is for fanatics, not for me, "injuries", additionally, apparently it's too expensive.

Please note, in Sharjah, we have 3 boxes only! Area of the city is 2,590 km/square. population of 890,000+

I have to be honest, I am struggling with numbers (my box is 6 months old), one of the boxes in Sharjah has incredibly low member base and I know they have invested so much in their box (it's part of a huge club); pretty sure they havent made any profit from their box in a very long time.

In Dubai, many boxes are suffering too, barely making it, some closed down.

Mainstream gyms started copying what CrossFit is offering as a regimen..if you're going to introduce something new to the fitness market..be aware that you will be copied, that's inevitable. Now some gyms are offering (X-Fit) classes with half the price of CrossFit boxes!

Honestly, People here don't really care if it's CrossFit or not, they just wanna workout and have fun. They come to me, and see my prices (I priced my memberships a little cheaper than competition) and they think, it's still too expensive, so they head to cheaper alternatives - mainstream gyms which offers group workouts.

It would be really nice for HQ to get involved, just some suggestions:

1- some business guidance- Budgeting, coach hiring, salary structure for coaches, recruitment assistance. CF can request from boxes from different regions to send them information and build a database, with that they can structure a full business plan for affiliates. In the end, we are all one family, an affiliates success is the community's success :-)

Marketing tools- at least in the UAE, CF's image is misunderstood..some internet marketing tools would be great, videos made to attract those new comers, Search Engine Optimization, pricing strategy, it would be lovely also to get discounts on equipment (at least the basics from rogue and other suppliers).


In my opinion, some boxes are closing/suffering because there is a lot of competition, and customers are having more options than before with regards to fitness and workout regimens. In order to survive, you need to standout with what you are offering as a box, or you wont make it.


Sorry for the long post.
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Old 08-22-2016, 10:04 PM   #7
Sean J Hunter
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Re: Affilate growth ground to hault - market stauration?

Thanks for the reply Faris,

Quote:
Re: CFHQ 'helping'
It is not in CFHQ job description to provide business support. There are plenty of good consultants around now, who offer this service. Remember you're only paying $3,000 pa. Where as a franchise, with all the support and systems, would be a whole lot more. think $100,000's

Quote:
Same results with our market perception: CrossFit is for fanatics, not for me, "injuries"
I agree, but in countries where the CF boxes havn't got together to manage their brand, they have lost out, for $3,000 you aint purchasing much brand management from HQ in your respective countries. Problem is affilates don't get organized. They mistakenly see each other as competitors, when you really aren't at all.


Quote:
Additionally, it's too expensive.
Quote:
Mainstream gyms started copying what CrossFit is offering as a regimen..if you're going to introduce something new to the fitness market..be aware that you will be copied, that's inevitable. Now some gyms are offering (X-Fit) classes with half the price of CrossFit boxes!
Quote:
Honestly, People here don't really care if it's CrossFit or not, they just wanna workout and have fun. They come to me, and see my prices (I priced my memberships a little cheaper than competition) and they think, it's still too expensive, so they head to cheaper alternatives - mainstream gyms which offers group workouts.
Quote:
In order to survive, you need to standout with what you are offering as a box, or you wont make it.

In the early days, it was much simpler. Build it and they will come. But, one has to recognise your point of difference when compared to globo gyms functional offering. It may be different in ME, but what I've seen in the US, AUS, NZ, are the following differences
- CF model delivers exceptional results, globo gym x-fit model delivers hype, its fun, but the buzz wears off pretty quick.
- CF offers relatively cheap personallized attention, globo gym does not, 24:1 ratios kinda thing, low trained coach
- CF offers real community, globo gyms can't. theyre just not geared for it.

We've found the following is bringing success in a flooded market
- Deliver as much value as you can = "gainz" as defined by the customer
- Measure those gains so they're not just recieved but actually perceived
- Provide as much personalized programming as you can...scaling baby
- Build real community
- conversions come thru friends...

I see alot of CF out there essentially deliverying what the globo gyms functional program does, lazy programming, no personalization, and no real connection with the members.....ya gotta knw and drive your point of difference.

Last thought here, notice all of CF adds now, targeted at what we call sector 4 and 5. Normal people, not fitness fanatics. The money is targeting the people who dont go to gyms, or have learnt gyms dont actually work. That is what you model serves. Cheap personal training, help these people discover a fitness solution that works for them for real, and you'll have a real convert. Money is never the barrier, understanding value is.

HTH

Interesting conversation.

Sean

Last edited by Sean J Hunter : 08-22-2016 at 10:16 PM.
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Old 08-23-2016, 07:05 PM   #8
Faris Hammadi
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Re: Affilate growth ground to hault - market stauration?

Quote:
Originally Posted by Sean J Hunter View Post
It is not in CFHQ job description to provide business support.
Totally agree..


Quote:
- CF model delivers exceptional results, globo gym x-fit model delivers hype, its fun, but the buzz wears off pretty quick.
- CF offers relatively cheap personallized attention, globo gym does not, 24:1 ratios kinda thing, low trained coach
- CF offers real community, globo gyms can't. theyre just not geared for it.
I agree, CF methods are superior than what globo gyms offer. Many of them offer HIIT group workouts only, and the people dont see the difference unfortunately. Me and you can pick that up right away "Hey that's not CrossFit!".

Quote:
I see alot of CF out there essentially deliverying what the globo gyms functional program does, lazy programming, no personalization, and no real connection with the members.....ya gotta knw and drive your point of difference.
oh yes..and unfortunately people generalize, that is the catch - to convince those customers that you are indeed different than that.

Quote:
Last thought here, notice all of CF adds now, targeted at what we call sector 4 and 5. Normal people, not fitness fanatics. The money is targeting the people who dont go to gyms, or have learnt gyms dont actually work. That is what you model serves. Cheap personal training, help these people discover a fitness solution that works for them for real, and you'll have a real convert. Money is never the barrier, understanding value is.
Yes! i love it.

thanks,
Faris
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Old 09-01-2016, 10:41 AM   #9
Victor J McQuaide
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Re: Affilate growth ground to hault - market stauration?

Our area is struggling also. Saturation. Some closing, some sold cheap, some having restructuring of ownership and some people crazy like me and opening a a box.
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