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Entries in demographics (7)


Will They Come? 4 Factors that Matter Most in Calculating Health Club Demand

This feature is brought to you by the IHRSA Store spring sale. Now through June 30, save 25% on reports, webinars, and all other resources in the IHRSA Store by using promo code 2016SALE at checkout.

Before you commit to opening, buying, or investing in a particular health club location, be sure you fully understand the four factors that matter most in calculating the local demand. They are:

1) Population Density. Health clubs thrive in markets where population density is highest. Sophisticated club operators like to site their facilities in markets where there are at least 60,000 and preferably 100,000+ people who are in close proximity to the facility. (Mini-facilities can succeed in smaller markets.)

2) Travel Time. In suburban markets, in which the car is the primary means of commuting to a club, the primary trading area for clubs in competitive markets extends no more than eight minutes for the primary market, 12 minutes for the secondary market of travel time from the club site.

Note that the reference is to travel time, and not to miles or distance. In every market, these two factors are distinct. Note, also, that this implies 12 minutes from either a person’s residence or from his or her office. Numerous health club demographic studies show that upwards of 80% of a club’s members come from within 12 minutes travel time of the facility. Travel should mimic the realistic route used by a local resident to the club site.

Travel times need to be calculated at prime time; that is, at times of peak demand such as between 6 and 8 a.m. or between 4:30 and 7:00 p.m., Monday through Thursday. In most suburban markets, 10-12 minutes travel time means no more than three or four miles from the club site, and it can be as limited as under two miles in dense areas.

In most situations, at least 70% to 80% of a club’s members need to come from within this primary trading area.

In urban markets, where parking space is limited and car travel is constricted, the primary trading area for a club generally extends no further than an eight-minute walk/commute for the primary market and a 12-minute walk/commute for the secondary area from the proposed site.

Because all markets tend to become competitive over time, travel time benchmarks need to be applied even if the market is not yet competitive.

Trading areas need to be plotted precisely. Each intersection point needs to be connected. That polygon is what should determine the primary, secondary, and total markets. Once a club’s trading area is determined, various demographic services can provide essential information, such as: the number of people that live or work within a particular primary trading area, their ages, their marital status and whether they have children, their educational attainment level, their median household incomes, the level of professional/ management occupations, home ownership, etc.

3) Household Income. There is a strong correlation between median household income and health club membership. Whereas roughly one out of five members of the American population is a health club member, member penetration rates among high-income segments often approaches 30%.

Conversely, when household income falls below $25,000, only one out of every 14 (7.2%) people is a health club member.

Household income is also a key determinant of club pricing. In general, in markets where the average household income is $75,000 or more, such a community can support dues pricing in the $60 to $125 range. (Naturally, it can also support clubs with lower dues structures.)

Where the average household income is $50,000 to $75,000, the market will support dues pricing in the $45 to $74 range. And where household income is in the $20,000 to $50,000 range, the market will support monthly dues pricing in the $10 to $44 range. In the last 10 years, the widespread availability of low-priced options has exerted significant downward pressure on health club pricing in many markets.

4) Educational Attainment. Educational attainment levels are another key factor in assessing demand. In general, the higher the educational attainment level of people in the community, the higher will be the overall market penetration rates of the clubs serving that market.

To cite but a few examples: the overall health club penetration rate among full-time college students is 24%; the health club penetration rate among men and women with advanced degrees (business degrees, law degrees, medicine, etc.) is 25.2%. Conversely, among men, who earn $75,000 or more, but who did not go to college, the penetration rate is 11.6%

Because of the complexity of assessing demand in any community, it is essential that feasibility studies be conducted by experienced third parties who are not developers, architects, or builders.

This post was excerpted from the IHRSA Health Club Business Handbook, written by John McCarthy and sponsored by ABC Financial.


What is the best way to mass market?

Can a club be something for everyone? Sure. But that doesn't mean you should target everyone in the city where you are.

Justin Tamsett and Tracey Bourdon tackle the question about mass marketing not coming back with the desired results.

Q: "We like to think of our club as a place for everyone. However, I have been noticing that our mass marketing efforts are not resonating with the different demographics we want to attract.  What are the best ways to target different demographics and market to them more effectively?"

A: Marketing of health clubs is becoming more difficult as generally clubs are doing the same marketing, so the consumer is becoming desensitized to our efforts.

The key for making your marketing successful (ie work) is segment the market beyond demographics and then go to that specific segment with your specific message.

This means drill deeper into a target market and get really specific about the description of that market. Consider their psychographics (interests and attitudes). Analyze these people and determine their pain points. What is creating pain in their life and your marketing must show them you have the solution. Discover where these people shop, eat, and hang out. And that is where you go to market to them.

Your marketing must have proven value of your product and how you have helped someone of that specific segment. This would be shown through a before and after photo, a testimonial or even better a video testimonial. You want people of the specific market segment to see the image, read the copy of watch the video and think “That person is just like me! If they can do it, so can I.” 

Finally, to prove your solution works offer a trial. A paid trial will reduce the number of leads but it will increase the quality of leads. This means the people who are prepared to pay a small amount to trial your facility (and your solution) will be more qualified.

A very important point to note is this: if your solution to your target market’s pain (ie why they would join your club) is not unique, then you are potentially simply raising the profile of fitness in your community and marketing for your competitors. So ensure the message in your marketing clearly states your unique solution to them.

Justin Tamsett
Active Management


A: Great question since no one has unlimited marketing budgets.

First, solicit the help of a full service marketing agency that can identify where your current members reside and the demographic profile of those neighborhoods.

This should help you identify “like” populations that would be good prospects for Club Membership.

Second, ask for a search of local residents who meet whatever demographic profile you determine is a great target (for example, homes with children ages 5-13  or women in the household with incomes over $70,000).  This is invaluable information as it allows you to precisely market to only those households that meet your search criteria.

Finally, don’t forget to use a variety of marketing tools such as email, guerilla material, Facebook and other social media avenues to spread the word about your promotions and programming.  Engage your members in “sharing” the word about your club and leverage the power of your happy members! Testimonials are still the best form of advertising.

Tracey Bourdon
Head Marketing Coach
Susan K. Bailey Marketing & Design


 Visit to read responses to more than 100 questions such as these or to submit a question of your own to be answered.


How to Measure Your Geographic Demographic in a Downtown, Urban Area

While health clubs in suburban areas measure their geographic demographic by drive time, clubs in urban areas have a different challenge. (Photo: B Tal)Rick Caro and Mike Motta discuss how to guage the range of a health club's target market in a downtown, urban setting in this week's Best Practices.

Q: "We're opening up a club downtown in a big city. Most guides to opening a club talking about 'drive time,' but most people will walk or take public transportation to our location. Is there a standard "walk time?" What other characteristics make up a great downtown location?" 

A: The question is how to define a club's market in a downtown urban location. First, the key is to determine if there is adequate parking and at a very inexpensive (if not free) price. If no such overwhelmingly impressive parking exists, then one uses walk-times instead of drive-times. The same timeframes are used (8 and 12-minute marks) in 8 different directions (N, NE, E, SE, S, SW, W, NW) and done only at prime-times during the week days. Both residential and daytime marketplaces are studied.

Rick Caro, President
Management Vision, Inc.

A: The standard walk time is typically no different than the drive time – around 15 minutes. In urban areas because your customers do walk the exposure to weather is key. If your location is within a building or cluster of buildings, it is important that they can walk safely, easily and even better without putting on their coats or popping up their umbrellas. Proximity to the busiest elevator banks is also helpful and if public transportation is popular enough for your members, proximity to the bus stops, train stations or parking lots helps you expand market reach and eliminates another barrier to joining and frequent utilization.

Other characteristics that also add value to urban locations are:

  • Street level sight lines that attract interest by allowing a glimpse of the activity within but do not make Members feel like fish in a bowl.
  • Natural light and lots of it.
  • Outdoor areas, albeit small and rare, are also features worth exploring. Like a big city apartment with a courtyard or a roof deck, having a place to enjoy the great outdoors in the heart of downtown is always a unique feature. 
  • Convenient access to grab a quick lunch, smoothie or snack. Most downtowns have many and planning your access points to take advantage of this convenience will save your Members time.

Mike Motta
Plus One


Geographic Demographics

Rick Caro discusses demographic research based on geography:

Q: “I have the demographics for a small town where I want to open a 3000 sq ft (275 sq m) fitness facility. There is lots of information on how to get demographics but I need to know how to intrepret them. What percentage of the population or a specific demographic should I use as a reasonable estimate for the number of members? ”

A: There is an accepted methodology to determine if a potential site for a club is deemed to be feasible based on a specific concept. It involves a proper market analysis using the old accepted economic law of supply versus demand.

Without doing the analysis properly, one can ony take a wild guess.

The definition of a market is not 4 or 5 or 6 miles (6.5, 8, or 9.5 km). It involves drive-times in each of the 8 directions (N, NE, E, SE, S, SW, W, NW) at prime-time in the evenings. One goes in each direction for 8 minutes (including waiting for stop lgihts, busy traffic, etc.) to define the Primary market and another 4 minutes (up to a 12-minute mark) to detemine the Secondary Market. These intersection points are then connected and these represent the real boundaries of a Residential Market. The local Daytime Workingplace market is studied.

These intersection points are sent to a computerized demographic service, 2010 data is received and applicable club penetration rates are applied. This creates the demand side.

Then, all fitness facilities -- using the widest definition -- which are in the Primary and Secondary Markets are identified. These include all forms of commercial clubs, specialty studios (yoga, Pilates, personal training), YMCAs/JCCs, parks and rec facilities, university fitness centers, etc. Each is visited by an industry expert and analyzed for its strengths and weaknesses along with gathering a deep resevoir of information. Then, follow-up research is done to determine its membership base.

A comparison of supply versus demand is then undertaken to detemine if it is a "Go" or "No Go" at the intended site.

Without doing the analysis properly, one can ony take a wild guess. After completing over 850 independent market analyses, my early guess is that the market is insufficient to support any successful club there. But the only way to know is to do the proper market analysis.

Rick Caro, President
Management Vision, Inc.


Small Group Training

Bob & Jolyn Esquerre, Lori Lowell, Michele Melkerson-Granryd, and Phillip Mills discuss the growing trend that is group training:

Q: “I keep hearing that group training is getting popular, so I decided I'd ask. What is the best way to implement group training? What kind of exercises work best? What demographic is typically interested in it?”

A: Your observations are correct....Group Training is indeed growing in popularity! The recession and the recovery, especially with high unemployment rate, has forced educated consumers to self-reflect more before they decide to spend money. Here are their thoughts, based on our experiences:

  1. They want additional spending options in addition to one-on-one training [e.g. Small Group & Large Group Training];
  2. They want a stronger reason to initially spend money, which include, for example
  3. Not only getting "Guaranteed Results", but they also
  4. Want a way to quantify/validate their results; which will give them
  5. A stronger reason to keep spending. If these 5 points occur consistently, they will have
  6. A very strong reason to refer their friends, family members and colleagues to you as their subject-matter-expert.
"... they will have A very strong reason to refer their friends, family members and colleagues to you as their subject-matter-expert."
However, most Clubs &/or Fitness Professionals are not successful in planning, launching & managing fee-based Group Training Programs.

Jolyn & I, as a minimum, have identified the Top 5 "Failure Points" why Group Training Programs have failed:
  1. Neither the Clubs nor the Personal Trainers knew how to market &/or position Group Training as an '"added-value" service; this occurred because
  2. They did not know how to create programming value for Group Training;
  3. They could not make a clear/compelling distinction between Group Exercise Classes & Group Training Programs [the exercises & the equipment used in Group Exercise Classes cannot be the same used in Group Training] ;
  4. The Club Managers & Personal Trainers did not know how to stimulate & manage consumer "demand" from educated consumers for Group Training Programs; and
  5. The selected Personal Trainers did not have the skill-sets to deliver & manage Group Training Programs.
For more detailed information &have the ability to ask and have answered your questions, please join us at the IHRSA Group Training Webinar on April 22nd.

Bob & Jolyn Esquerre
Esquerre Fitness Group International
Business Solutions Consultants

A: Group Training is very different from Personal Training. Group Training must stand alone as a separate department within the gym. Add it to the org chart.

Many people think that the best way to implement Group Training is to put it under the direction of the Personal Training Department. There is a skill to working with people in a group to include:
  1. Team Building
  2. Putting a compatible team together with a compatible trainer
  3. Delivering an outline to the group of "what to expect"
  4. The trainer must do their homework and know who they are working with.
The best success of Group Training will occur if you have an Trainer/instructor that is both a personal trainer and a group fitness instructor. Because the two approaches are very different it is important to have a really good handle on both skills (group fitness instruction and personal training).

A philosophy of operation of what the approach of "group training department" is critical and the club needs to identify exactly what the approach will be not only from a training perspective but also from a guidelines perspective.

Ask these questions for your team in regards to group training:
  1. What is it?
  2. How are we going to implement it?
  3. How are we going to market it both internally and externally?
  4. Which employees will be part of this "new" department?
  5. What does your "proforma" look like?
  6. How many people can you service; monthly, quarterly, annually?
The mistake that most clubs make is they just go up to the fitness director and say - let's start doing group training without any vision, mission, values, goals or philosophy being set.

Avoid this and focus on implementation by getting this "new department" ready and follow the 6 steps mentioned above for success.

Lori Lowell, Owner
Gold's Gym of Woodbridge, Lorton, Fredericksburg, VA, Madison, Milwaukee, WI
President, Group Fitness Solutions, LLC

A: Small Group Personal Training is a great way to expand your training business and generate additional revenue. Small group training often expands personal training revenues by bringing the group fitness participant into personal training. There is still a social component but more opportunity for individual attention and targeting the workout towards accomplishing specific goals. It’s also an affordable way to introduce members to personal training who have been resistant because of the cost or to increase the number of sessions a client is doing per week with the goal of creating results more quickly.

I recommend that you create your group with a set number of weeks, preferably 8-12, depending on the season. Ideally, you will have a theme that describes the focus – for example, in the spring you might offer, “Beach Body Boot Camp”; “Strong Bones” is ideal for a group of women in their 50’s and 60’s; Yoga Strong could be geared towards men and individuals who might be a bit skittish about getting involved in yoga; 10 weeks to a Stronger Back might be targeted to clients that your massage therapists have identified as. Ideally you will run 3 to 4 cycles of Small Group Training to follow the seasonal cycles of your business. In our area it makes sense for us to run a fall session (September to Thanksgiving, about 12 weeks). We do some smaller bridge sessions for our members who are in town through the winter holidays (Thanksgiving through the first week of January). A winter session starts in the 2nd week of January to Spring Break (2nd week in March) and a spring session runs from the end of March through the first week of June, which is when our schools get out. We also do a summer session starting in mid June which runs through mid August. During those weeks that no groups are scheduled the trainers can run make-up sessions if they feel the need.

It is also important to keep the groups fresh from session to session. You can do that through the theme and also through the equipment that you use. If you are starting brand new with boot camp – perhaps use the equipment you currently have on hand, then every other session or so – add something new – kettle bells, the power rope, ladders, go outside, etc. Keep in mind that your trainers will get bored more quickly than the clients.

Michele Melkerson-Granryd, General Manager
BodyBusiness Health Club & Spa

A: Group exercise has huge potential to help most clubs to improve their business. At a time when many clubs are being hurt by low-cost competition, clubs with great GX are actually increasing their prices and creating a whole new paradigm in our industry. While the average club has less than 500 GX attendances per week, some have more than 5,000, which creates remarkable profitability. I am aware of a number of midsize clubs with gross profits $2-3 million a year based on GX success.

The first key is to track attendance. You can’t manage it if you don’t measure it! Set yourself a goal of increasing weekly GX attendance from, say, 500 to 2000 over the next three years. Have your instructors set their own individual goals for every class they teach, and produce weekly ranking lists, with quarterly prizes for the best performances. Incentivize your GX Manager or Fitness Director to achieve quarterly overall targets. (Les Mills offers attendance-measuring hardware and analytical software if you wish.)

Methods for achieving your targets include:
  1. Recruit instructors with the potential to attract big numbers – people with previous stage experience are great, along with passionate fitness freaks.
  2. Create a training calendar for your instructors involving external providers and internal coaching. As with any athletes or performers, GX teachers need constant practice to become masters.
  3. Design a great experiential studio using theatre principles. The industry standard for studio design is bland and sterile. We need to create unselfconscious, fun places for people to enjoy their GX.
  4. Hold regular GX events where you introduce new classes and material, and ask your members to invite their friends along for free.
  5. Launch licensed programs like BODYPUMP® to create buzz and quality assurance for your members.
Phillip Mills, Founder and Creative Director
Les Mills International


Researching Local Demographics

Rick Caro, Jesse Keene, Karen Jashinsky, and Beth Shaw discuss researching demographic information for business plan development:

Q: “I am developing a club and am wondering, what is the best way to find information on demographics for a new club?”

A: It is imperative that a club owner understand the current market conditions at a particular site before embarking on the development of a new club. This Market Analysis involves the old proven economic law of supply and demand. In the case of a club, if demand for a particular club concept is greater than supply (i.e. competition), then it is likely that it is a "Go" situation. If supply is greater than demand, then a "No Go" conclusion is likely.

To analyze the demand side, one must do actual fieldwork and conduct drive-times (or walk-times if in a downtown urban area) in each of the 8 directions (N, NE, E, SE, S, SW, W, NW) at prime-time weekday evenings to be conservative. I can provide the specific instructions. Then, the intersection points for the Primary Markets as well as the Secondary Markets are defined. When they are each connected, the boundaries are specified. This forms the basis of a polygon (often, not a simple circle). This polygon is then transmitted to the computerized demographic service.

There are key demographic variables that need to be singled out and studied. Often, these are not part of a standard demographic package. They are numerous including age, ethnicity, family income level, educational attainment, occupational level (not industry), size of household, ownership of residence, etc. These help define the profile of the residential market. One needs to know the norms to first understand the data. Then, the data needs to be interpreted using club industry penetration rates to create a Total Demand calculation. This also includes an analysis of the Commercial Working Marketplace to complement the Residential.

Once determined, this only addresses the Demand side. Then, the future club developer needs to identify all fitness facilities that lie within these two polygons that defined the Primary and Secondary Markets. The widest definition of competition is used and includes commercial health clubs of all sized and types, pure Yoga or Pilates studios, personal training studios, YMCAs/JCCs, other non-profits, university fitness facilities, public park and recreation facilities, military base recreation facilities, major condo/apartment facilities, member-owned clubs, etc. Each of these is analyzed completely and its total adult membership is determined.

One then compares the demand versus the supply to determine if the site is truly feasible or not.

Rick Caro, President
Management Vision, Inc.

A: I strongly suggest buying demographic reports for each town within a five/ten minute drive time from a fitness only facility, a 20/30 minute drive time for a facility with a pool and up to a 30/45 for a fitness facility with tennis and pool. You should buy these demographic reports before developing/building a club at a specific site. Select a site and start driving and watching the minutes go by depending on your type of facility. Write down the towns you go through. We used for our location search. They are a good price and offer a great selection of services. I wish you luck!

Jesse Keene, Founding Partner
Summit Health & Fitness

A: There are companies that can help you do a demographical analysis and study. You can give these companies some specific details such as the zip codes you are interested in targeting in (or the mile radius from the main zip code), income bracket, number of families, kids etc-you get some very specific information that can help you make some decisions.

I think it is also very important to first figure out what kind of club you want-who your target audience is and how many clubs, schools and businesses that might serve your target customer are in the area.

You should also make sure you really understand the traffic patterns in the area you are looking at. For example, in Los Angeles due to the ridiculous traffic during certain hours of the day many people will not drive more than 1-2 miles to get to a gym. On the other hand it is important to get a good understanding of whether people prefer a gym near their home or their work or school.

Once you have a good grasp of these things you can conduct a detailed demographic study.

Karen Jashinsky, Founder & CEO
O2 MAX Fitness

A: One of the best ways to find demographics is to go to the Chamber of Commerce in your town. Additionally a thorough drive through of the neighborhood looking at local stores, restaurants and schools will give you a good idea of your potential customers habits and lifestyles and how you can best attract them.

Ms. Beth Shaw , Founder & President
YogaFit Training Systems


Top Three Reasons People Join a Club

Q: "Based on the most up to date research, what are the top three reasons for people joining a health club? Are there differences between age groups and sex?"

A: There are many reasons why people join health clubs. This is evident by the total number of health clubs and different types of clubs out there to join. Some clubs offer any activity and amenity a person could want, while others focus on a few core activities. Whatever the consumer goal, there is a health club out there designed to help meet that goal.

Whatever the consumer goal, there is a health club out there designed to help meet that goal. IHRSA recently (April 2009) conducted a survey of 1,000 Americans and asked them why they are attracted to their health club, what their personal goals were, and if they were not members of a health club, what prevented them from joining. The responses were very interesting. When members were asked what attracted them to their current health club, the top 3 selections were made (multiple selections were allowed):

  • For their overall/health & wellbeing (69% of health club members)
  • For the variety of equipment, strength and cardiovascular equipment (55%)
  • In order to get my work out in, rather than to socialize (48%) When we take a closer look at the responses by analyzing the demographic data we get a better understanding of what motivates people to join clubs and continue to exercise at them:
    • Exercising for overall health/wellbeing was the most frequently selected response by all health club members. However, the most notable demographic consumer group citing this reason were those who have incomes over $80,000. Income appears to play a significant role when working out with friends and family; members with incomes between $41,000 and $80,000 cite this reason more so than those who make less than $40,000.
  • When we take a look at how age/generation factors into selection we see that Generation Y (19-29 year olds) are most likely to cite the following reasons more so than the Eisenhower Generation:
    • The variety of equipment, strength and cardiovascular equipment
    • Access to group exercise classes
    • My friends and family work out at the club While Generation X (20-33 year olds) are most likely, as compared to the Eisenhower Generation, to cite that they use the club because they feel obligated to go because of the money they spend on membership. Baby Boomers are most likely, as compared to the Eisenhower Generation, to cite that they use the club because their friends and family work out there.
  • As for how gender plays into the selection process, it seems that women are most likely to select a health club to gain access to group exercise classes, more so than men. See below for more detailed reasons why members choose their health club, as well as the personal goals that motivate them to exercise there and what prevents others from joining a health club.

An online survey of 1,000 Americans conducted in April 2009, indicated that health club members (14% of the sample), keep going back to their health club for the following reasons:

Additional demographic and statistically significant selections can be found by visiting