What Can You Learn From Competitors?

gym, fitness, planet fitness, crossfit, month, people, owners, years, uninspired, coaches, bucks, model, compete, price, opportunities, market, globo gym

Tyler 00:01

Ladies, Gentlemen, welcome to this week's episode of the gym owners podcast. I'm your host Tyler Stone over there, John Fairbanks. How are you doing, John?



John Fairbanks 00:07

I'm doing wonderful Tyler. It's too goddamn hot. I don't know if it's hot where you are, but it's been ungodly hot for the Virginians.



Tyler 00:13

It is hot and I have been sick indoors. This is day three, I think of that. So I've turned the air conditioner on to 68 degrees. Oh my god, cold sweats. It's been rough over here. So I haven't even been outside in a day and a half.



John Fairbanks 00:27

The Virginians aren't used to it. Like it was like it was like 100 and something like heat index, not not Temperature wise, but like heat index. And that as too hot for the Virginians in July, like there used to like maybe a couple of days in August, but everyone's freaking out at this point



Tyler 00:42

to call themselves the South. I never understand that.



John Fairbanks 00:44

It's wild. Right. But I mean,



Tyler 00:48

let me rephrase that the term of the South just paints where you were on one side of one. Direction directional. I understand. Yeah.



John Fairbanks 00:57

It's more of what it's the spirit of the thing. It's kind of like



Tyler 01:01

how the Minnesota Timberwolves are in the Western Conference in the NBA, and nobody bothers to ask any questions about that. Like, all right, guys, let's get into today's topic we want to touch on is really, it's a matter of I say, respecting your competition. I don't think this is about spying on them or being shitty, or whatever. I think it really is. You need to understand that anyone that's in this industry that is doing well, whether we think that is a fad, whether it will come, whether it will go well, whether it will go away soon, I do think it is important that you understand what is working for some of these brands right now. What some of the features that have the people likes, whether it's let people like whether it's the price points, whether it is the services, or whether it's just where it fits into its market, I think that there's a lot to be learned from you actively looking at the other businesses in the gym and fitness industry. I think it's way too valuable. I think I see a lot of people that do like the stuff that we kind of advocate for which is coached product service based results driven fitness businesses. Yeah. And a lot of people in that position get real fucking hoity toity about all this other stuff. And my opinion, I think that's the biggest mistake that you can make is to be like, Well, I mean, you know, we're, we're a functional fitness gym, you know we do is that we don't like the amount of shitting on machines that CrossFit did in the, in their early era era before they realized like, oh, yeah, that's pretty fucking stupid. We should probably also use some machines sometimes too. It would be nice if we had some machines in our gym from time to time. Maybe the reason that they had to demonize machines in the CrossFit format. Because it's really hard to have 10 or 15 of every machine so that you can do group classes that way.



John Fairbanks 02:52

And isn't it a little bit like planting your flag in the ground a little bit? Yeah, where's this idea where you're like well, we are different and we're different and then we demonize whatever is popular at the moment. So because like machines were popular, more common, it's like we're not that that's them and this is us and kind of throw the baby out with the bathwater so



Tyler 03:11

functional we just do fucking snatches deadlifts for time. The fuck so you know what I mean? Like, it's like, let's not pretend that every fitness methodology doesn't have some stuff where they, you know, throw in some really stupid shit, and mix it in with a lot of really good ideas. Maybe it's because it's fun, maybe because it's just the way they like doing things. I've noticed. There's never really good nor bad in my opinion in the industry. As far as what the clients are doing for the most part, it really is this constantly. What's the word is this is a constantly meandering line, which is us trying to find the balance between what we're actually trying to optimize for what is the most optimized training? Well, maybe it's the one that people will actually continue to do. And somewhere in there, you know, lies the secret sauce, but so we've been looking into a lot of these other businesses that have been doing really well over the years and we've talked about some Globo gym type stuff, and I think that there's obviously like your planet fitness is one juggernaut in the big huge essentially warehouse or what's the word? What would I use the word distressed mall property strip mall properties, department stores like that is I believe, like the planet fitness model, that type of layout that type of size and scale. And there's some other attender at 10 bucks a month, it's really difficult to compete. If you're a regular Globo gym or regular 24 hour access only gym and you're 50-6070 bucks a month or whatever. Planet Fitness at 10 bucks a month is gonna fucking absolutely crush you. If it's in your market, like it's that because if you're at 50 bucks a month, right now you're it this is just my opinions out frankly at this point. But I do really believe that you are already competing for the bottom of the barrel price wise, that's such a low value cost 50 bucks a month, it's just not that big of a deal financially. It is the people that it is a big deal for financially might maybe be the people that aren't your ideal customer because they can't spend a lot of money and they do take up a lot of space. So I think that having Planet Fitness in your area is a good anchor point. Actually, in the inverse, it's not a price anchor on the heavy side, I like it being a good anchor on the light side. And I like that they are at least willing to play the game and run at a loss for a really fucking long time until they build up that base because it is a juggernaut of a model the feasibility of every every franchisee, or whatever you call it is really not the issue. It just isn't because they can occupy 1000s and 1000s and 1000s of members in your marketplace in your market.



John Fairbanks 05:59

Well, and I think this is going to be the spirit of like the episode because we were having this conversation earlier this week, which is like there needs to be a more nuanced approach of like how we're thinking about these juggernauts and not just throwing the baby out with the bathwater, which is like, Well fuck them. They don't do it. They don't do what we do. We're hired touch points. We care about our clients, they don't care, right? They're the Netflix of the fitness industry. But at the same time, we've definitely got we've been way more nuanced than initially where it's like, Well fuck them, we're different. It's like, well, no, no, like it's, I like the idea where I want to touch on this. So it feels a little scatterbrained. But it's like this idea of understanding your population. And I mean, like population counts, because that's what you and I started to really find. And we see warnings and red flags for our boutique gyms or say you are maybe a franchise owner of one of these boxes or these larger and I say xbox one of these big warehouse style gyms, right big gym with like capital G. And it's if you are in a spot where like the real big boys aren't, you get to get it. If you're in like in a fitness desert, where there's not a lot of other people witnessing around you, you can get away with being really uninspired, you can get away with really not doing a whole lot, maybe doing sketchy shit, and there's nobody else to go to, to compete with you. And the problem is, is as everybody continues to build out, and everyone, people flee from the city areas, and all these rural areas continue to get beefed up, you run the risk of these investors coming in, or people coming in, and now popping a spot in your place and they will crush the fuck out of you. Because you are charging $50 A month because if you're the only game in town, you can charge $50 a month, but when Planet Fitness shows up, they're gonna charge 10 to 15. And they will crush you because you are the player that is only grabbing that bottom of the barrel, you've been able to get away with it because you've been the only game in town or your population is small enough to not attract the sharks.



Tyler 08:00

There is a kind of like you said two extremes in this realm, which is if you are in a if you're going to do uninspired fitness, okay, whatever that's going to be right the business is uninspired, it is just it is present. It is there. It's really tough to compete with 20,000 30,000 square feet to $3 million worth of equipment and $10 a month towers that are clean, you know, I mean, it's just, it's really difficult to compete with that. So if you're going to do uninspired fitness, you better I guess, be one of those juggernauts, right, you're gonna have to be one of those, and you're going to have to be in a market that can support. We were looking at another model that we'll get into later, but, you know, they were looking at like 6000 Right, I think was around 6000 members was what they carried, on average different with the



John Fairbanks 08:54

average member count for those 6000 patients.



Tyler 08:57

And so now that in reality there's plenty of CrossFit gyms that we worked with directly that make well over that with just less than a couple 100 members. So it's like, it just depends on what you're trying to do. But if you're going to if you're going to do on inspired fitness, then scale is going to have to be, you're gonna have to be in a marketplace that you can just really get a lot of fucking bodies, and then you're going to need to be low price. If you're gonna do inspired fitness, you could work anywhere. And I think that's important to know, that's gonna work in any marketplace. I think that market is also going to be able to support your business, because you don't have to have 6000 people. You don't have to have all of this space. You don't have to spend $6 million to set up your business or $3 million to get set up and get started and to have a little bit of runway but the other side is then if you're in a market that is like you say a fitness desert. This is where mediocrity fucking breeds man I live have been one of these holes here and there's not a single, single speck of inspired fitness, professionalism in any entity I've ever seen in my area, not one, it sucks, but you have businesses that can kind of exist and do well and be around for a long time. Because mediocrity is the fucking norm. Right? You just got to be there. And that's why they end up settling into this middle of the road price shit, because these businesses or the market is not big enough to support them on $10 a month. Exactly. The whole system, the whole the math all breaks down there, but they're not good enough and don't give a fuck enough to actually be successful at the thing they're trying to be successful at which is coaching helping people being a pillar and you know, these gyms just don't do fuck all and they just kind of exist and it kind of works it just kind of middles forward and it is what it is. And it's fine. And that's why I've said I talked about this as a price anchor. I would love for Planet Fitness a crunch fitness, one of these $10 A month juggernauts This is unpopular, unpopular fitness Tyler, I think there should be one of those in every single goddamn town of more than 50,000 people. But why? Because it's going to one it's going to weed out the fucking bullshit because every one of those places is better than these $50 A month spots you can still hear me right John? Yeah, okay, every single one of those places is better than that $50 a month but John wants to give me a pause real quick we're back to a little technical difficulty there. Getting a little excited hit my table and knocked off the power from my camera. So there's how much I care about this subject guys. But I do think it's very important for I think an ideal situation would be in any mid level to lower level market say about 5060 70,000 people I would love for a Planet Fitness crunch fitness one of these $10 A month places 20,000 square foot facilities to be in every one of these towns will absolutely just root out all of the mediocrity, poor uninspired business and oils all of the shit that all these other gym owners who don't give a fuck, it boils it all down to its essence which is oh, we are all competing on price because nobody actually cares. Well, I hate to break it to you. Planet Fitness crunch fitness. They got like a shitload of equipment, really fucking pretty nice facilities, and say what you will about the vibe. That vibe works for a shitload of people. And when I hear gym owners that are like a little too snooty about it, like what all this target purple equipment, I've literally heard that out of gym owners. So when the fuck does that even mean, dude? It's crazy. But I hear that stuff. And I was like, Oh, just you're just like, they would absolutely fucking bury a lot of these mediocre. Frankly, what are these franchise gyms that were kind of the big ones 20 years ago, are getting destroyed. By the even cheaper model. This is a Amazon Walmart type situation where they're coming in and they're just willing to take losses for a long time play the long game for the sake of market share,



John Fairbanks 13:12

and think about it because we've been intimately involved with say, a franchise model like an Anytime Fitness right? Smaller as a smaller footprint overall, right? Anytime Fitness is nowhere near the size of Planet Fitness, or is over crunch, right? Not even in the ballpark. And when you use Zoom Out, and you really look at it, it's like okay, well, Anytime Fitness just does what these big ones do. And that is one of the problems where you're gonna see some cannibalism that's going to happen within these franchises where it's like, if I can do what you can do, but I can do it better. As for the product, I'm certain, as a client, as somebody that is like going to that gym, I like someone that's bigger so I can get more access to equipment, I'm not fighting for that equipment. And then I have more things to do. It's fancy or shiny or all those things. But as you see that, like you said it, it just raises the overall fitness thing for the people in the area. And that's what I like the most when we look at some of those statistics of like 70 to 75% of people in the United States do not have a gym membership. Okay, what's more feasible, your $200 a month membership, or a $15 month membership? So if you want to get more people witnessing and being involved, they will go to Planet Fitness, they will go to these juggernauts first, which is awesome. It's awesome. They will net a $10 - $15 a month person who never comes to you at your functional fitness boutique shit, because you're too goddamn expensive.



Tyler 14:52

That's okay. Right,



John Fairbanks 14:54

right, right.



Tyler 14:54

The nice thing is that it establishes that difference and actually that's probably even easier to explain. I know when I owned my CrossFit affiliate, I didn't have any trouble with that, because it's like any time was right next door. They're 14 bucks a month or whatever. Well, why would I come here as like, oh, well, we don't do what they do. So go there. If you want 20 bucks a month or whatever, like that's, yeah, definitely do that because I'm never gonna. You're never gonna pay that here. So like don't don't sweat, just know that what we do is different than that's fine but apples to apples is what we need to be discussing here. Now what is interesting is what say a crunch fitness probably more so than I would say a Planet Fitness just because Planet Fitness has this reputation with their lunk alarms and no cut off sleeves or whatever else even though I think he was still squat, they're still bench. There's still dumbbells, there's just a shitload of machines and they don't want you listen, I train it lots of global gyms that you have over the years and there's a lot of bullshit with guys literally like swam and dumbbells on the floor like in literally like week dumbass guys like just like slamming dumbbells and yelling and being fucking irritating. And there's a place for that. But it certainly is not that you know what I mean? Like, you ever eat at your house John, like, like a real fat buck. Like you ever just pick out like, oh my god, I had no silverware, too large pizzas or whatever. And you're just like thoughts all over your shirt, and you dip into Boston ranch. Been there, done that. Still hit that a couple of times here. But you know where you're never going to do that at fucking restaurant. You know why? Because there's a place to act like a fucking fool. There's plenty of gyms that are gonna allow you to crank up your own music and slam bars and, and that's fine, find one. Just go ahead and find one. But I don't think that like the particulars of what they expected their members at a Planet Fitness is really going to be a deterrent for anybody who's actually considering going there. That's the best part. For them. It's like the guys like me who are going to be who liked me. But listen, if there's a planet fitness here, I would definitely have a membership. I want to go fuck with 700 different types of machines. That sounds fun. Seems like a really novel and interesting way to get a fucking huge pump dude. And at 10 bucks a month it's disposable, it can be the fourth gym membership I have, like concurrently. Now I will say crunch fitness I would put ahead of it as far as like the perception just because that vibe is not really well known. But I think it's very similar in Model X, that they've added group fitness classes and some more service based things that you can serve as base offerings in that model. Now let's just say a crunch fitness is in an area like this with a couple of you know, global gym franchise chains, CrossFit affiliate, a YMCA and a couple little small gyms right in me immediately that $10 or $15 a month price point will take away any interest from anyone that these 50 $60 A month global gyms are going to any interest that they're going to get from new people in the next year. They will get literally zero if that one opens up. And that's the problem is gym owners don't understand this because then they've gotten so bad at the marketing. They've gotten so bad at the service that they don't fucking care because they don't have to compete. And the moment one of these comes in, they're beating you with the only thing that you are doing well are but I guess is that you're cheaper than everybody else. Well, guess what, they're a quarter of your price fifth, your price, you're fucked. And you're better at the thing that you 're better at everything else that you do, that's the worst part, their facilities are going to be cleaner, bigger, more fun. Like there's just it's gonna be really really really difficult for an average Globo gym franchise owner to fucking to make that work with that thing with a big huge $10 A month chain right next door.



John Fairbanks 18:48

And as we drilled into it like crunch fitness, let's use them specifically. It's like in the first year, if you come on as a franchise owner, I think they earmark something in the ballpark of like $10 to $15,000 per month, a month, first year in just marketing. So if you think about like running ads and marketing for that new spot that just showed up, not only are they going to be shinier, or fancier and do all the things and be newer, but they will literally 10,000x Your spend because you're not doing the marketing because people kind of just show up right now and I've never really had to worry about it. I haven't even thought about it. So you got to be the cheapest for so long. And you are about to see a Goliath show in and show up and literally just pound your shit into the ground. Yeah, right



Tyler 19:39

here gym owners who are like I don't need to run any paid ads don't do that don't do anything that listens to the plague or they're fucking disinterested on social media, no social media strategy, organic paid or otherwise. No general networking or marketing strategy. No plan to get fucking members offers none of that there's no levers that they have installed that they can pull to even Try to get some flow coming in any is none. And you're going to get someone who's going to show up on your blog and start spending $15,000 a month. That's we're talking billboards, we're talking radio, you're talking television, and you're going to absolutely blast everybody on Facebook, Instagram and Google for fucking ever that is a spend that will dominate a, probably their ideal marketplace I would get or their ideal market size is probably in the 100 to 250,000 population,



John Fairbanks 20:33

right visualize Yeah, and for sure, because we



Tyler 20:36

just fucking go so far. It's kind of a nice sweet spot to because you just become the only one that anybody fucking hears. It's very interesting. So when a gym owner is like super fucking laid back and chill because things are happening, that complacency. You just better hope that the wolves never show up on your blog. You know what I mean? Is that the plant?



John Fairbanks 20:57

Like no hospitals built in your general area that then causes more people to move in? Because if people start moving in, you start thinking, but if you start seeing a bunch of communities getting built where you live, and a planet fitness, isn't there yet. It's coming. Just wait because they will show up. But I don't think this is the apocalypse. They are. I don't think this is the end of days for you. I do still think it's a net positive overall.



Tyler 21:22

Do you know where do you know where the I think that we can these other boutique gyms higher price, higher price point fitness facilities, one your service can and absolutely will be better, I will guarantee you that like your crunch fitness isn't shit like that are not paying coaches, well, they're not going to get career people, you're going to have personal trainers that are going to be aces, that it's just their real passion, because they're going to keep 80% Most likely, you know, the the gym is going to keep fucking 80% of that of the price for personal training. If these coaches may be making 20 bucks an hour or something like that, which is never going to work, it's just never going to work for your business long term, your clients are always going to have some dipshit coaching them and that's not going to bode well for you in the long run. But for gyms that do functional fitness classes, or personal training studios are blended versions of both inferior Globo gyms that have yet let's just pretend you do what crunch fitness does, which is we have some group fitness, we have access, we also do personal training. And we have opportunities for other things like Zumba, hit classes, whatever. You can take the things that they are doing, do them better than them and charge 20 times as much money per month. And all of a sudden, you know who you get good clients who have money to spend. So then when you're looking for your opportunities to grow, or to make more money out of your client base, you could choose I have 6000 Fucking really broke people that I'm then trying to upsell into us 567 $100 dollars a month worth of personal training. And how is that? How is your closing rate going to be on that probably not that good. You'll get some simply because of the scale. But that's not going to be that good because your market is actively priced to seek bargain shoppers, or you're the place that's 180 bucks a month, and you've got 200 people and then you're going to solicit all of them for some upgraded personal training opportunities. I guarantee you'll make more money off of personal training out of that 200 population than 200 groups or two, what am I using here? 200 person membership base, you'll make more money off of them than you



John Fairbanks 23:35

would have the other. Right. And you glossed you said it really really fast at the beginning of this conversation. But I think it's important to go back to it, which is it, you got to understand that 6000 People 6000 members at one of these large big, big gyms at $15 a month when you really crunch those numbers. We've worked with lots of different gyms that make more money than that with 200 members.



Tyler 24:04

Our million dollar a year CrossFit affiliate absolutely crushes that model. And by the way, John, here's one thing we talked about when you're going through this no fucking robust your systems and sales processes need to be to just actively get signed up 6000 People



John Fairbanks 24:22

just just like their first month getting their first month and that's full



Tyler 24:26

time fucking sales staff kind of Oh yeah, your meetings appointments or you're doing it all digitally, which is probably what I would do, but it's still as these people are getting in, they're getting key cards. That is a fucking massive undertaking. I want nothing to do with you. Because that's not fucking fitness. Nobody gives a shit about that. We do enough of that stuff. So that we can worry about the rest of the stuff which is getting results, making actual money because by the way, you're doing all of that for $60,000



25:00

right fucking blows.



Tyler 25:01

The only hope you have is unfortunately for those gyms that say they don't ever have to actually worry about seeing most of those people again. So you don't actually have to service those accounts at all. It's just there forever. But



John Fairbanks 25:11

and then the next step in this process of the idea of like, this is a rate a rising tide that's benefiting your community overall, is if you have a monster that comes in, and they're gobbling up the market share at that tenant $50 a month, you have now just kickstarted mean depending on like, my population, where I live is like 20 25,000 people 20,000 listings, 20,000 people, well, if you're gonna say, you're gonna get if there are 5000 members that are at that gym that are now going to that gym, it's safe to say, right, that's a huge pop, that's a huge pool of the entire population that lives here now has done you realize that they have just done a thing that would have taken you for fucking ever and would have been so expensive. And they're just built to be able to do it, which is they just kick started a fitness journey for 15% of your entire population that wasn't going to go to your gym anyway. Because you were just too far out of reach. It's the literal definition of I'm not in good enough shape yet to go to the gym. Right? All those people will they're going to go to the baby be fat, the fat and ugly, we love fat and ugly people. And that's what they're going to do. And they're going to be able to market to them. Well guess what? All the fat, ugly people that were scared to go to your ship. They're now going there. Which means, like we talked about all the time of this, like it's a lifetime fitness journey for everyone on the planet. Great. They just got everybody on kickstarter, which means there's going to be a population, a percentage of them that will go so far, and they go, I want something more now I'm not as intimidated. And now I feel more confident or whatever. And now you become more reachable. Just like you said, there's some people where it's like, well, I can I can actually it's so inexpensive, I could keep my membership here. And I could do personal training over there. Or I could do this here or I could go there like it's it gives people the opportunity to now do more.



Tyler 27:05

And I think you mentioned the lifetime fitness journey as well. While the thing that they are absolutely failing at these big models, let's touch on this is client success, that we can all agree, right? Why is that price point there? Right? In reality, if you're paying $10 a month, and you're like really think you have a very high likelihood of success, you can assuming that you carry you as the consumer carry all of the burden of knowledge, motivation, etc, you're going to handle all of that yourself, because they're going to they're not going to provide any of the services is going to be relatively low quality. It is just all on it's 10 bucks a month, you don't get a lot of time from their staff, let's not be let's not kid ourselves here. So they have to do all of this by scale. And the reason truly, you're paying for likelihood of success, speed of success, likelihood of success. And just know that as the consumer is seeing this as a low budget opportunity to go in. And maybe I'll give it a try that is a buying psychology play that you can now take advantage of. Because it really is those people who are going to go there. And they're going to spend 10 bucks a month. And they're going to go three times and they're not going to go for two years. And they're going to pay that contract for two years. And they're going to be done. And where does that leave them? Probably nowhere. But if you then have a product that goes you know what, we have got accountability, some nutrition coaching, because nutrition is the deal for weight loss, it is the thing we can't continue to hide out, bury our heads in the sand about we can have one on one personal trainer, we have group fitness, which gives you this component of community accountability and coaching all in one package. And that now becomes a thing where people will instantly recognize the difference between the $10 product that didn't do anything for them. They require them to know, do and motivate for everything that they do and motivate themselves for everything that they do. They're going to instantly recognize the difference between that and your product and because they have already experienced that low end thing. Right. And there's plenty of people who I run around with quite a few like power lifters strongman guys, somebody like I said to almost never hire coach, they would never spend more than 60 bucks on a fucking gym membership. And I mean, wouldn't be caught dead in a group fitness class to save their lives, right? Because it would like you know, openly mock that type of stuff. They'd never be caught dead in one of those places, and yada yada yada. But in reality, you know, those are such a small sect of people. And very rarely do people just get introduced into that fitness segment. And not only that, a lot of these guys By the way, I get into powerlifting as a way to work out, but I still get to eat a lot and stay fat and get fatter. For sure that, in my opinion, is one of the biggest plagues. You're gonna see it here. Well, you've seen it, you saw it last year, you'll see it this weekend, the powerlifting meet. But it's like you get a lot of guys who work out really hard, but they're just all fat and look like shit. Well, I hate to break it to you, like those people are. They're not even seeking fitness, wellness, looking, jacked weight loss, nothing. They're just seeking this little hobby, well, some people get autistic about building model trains, and the rest of them do powerlifting. Right, that's kind of that's kind of the way this goes.



John Fairbanks 30:37

Now, we've been talking a lot about pricing. And I think it's important because it's the most it's the most obvious that when they come into the community of the effect that it will have on the community, and it can be the most fearful because if you know is the race to the bottom, how you price if you priced based off of of gyms that are running different models than you, I mean, we've shed all over this for literally years. But the next thing that I think is really valuable about looking at these competitors and peaking kind of go into their websites and check them out, go get a fucking membership, go get a day pass, like go look at their shit, like in person is they're doing as much as we will shit on them or you want to hit on they're doing really, really fucking cool things that you are one 100% allowed to say. I hate that. I hate that. But that's really cool. How can I do that? Can I do that? In our version of that? I mean, fuck Tyler, we were looking at a gym in Arizona that had a goddamn movie theater inside the gym, just EOS



Tyler 31:36

ethos notes or whatever it was. Yeah, I have a client. And by the way, I thought this was an expensive gym. Not Yeah, yeah, it sounds way cheaper than I do. I still have it even. We pull this up. But I think it was quite affordable here. But anyway, maybe I'm wrong. But I have a client who had personal training, he goes down south for the winter. And he was telling me he goes, you know, they got this thing, they have this entire room that is set up like a movie theater, in their big screen, huge surround sound. And they got show times where they'll watch a couple movies or whatever, per week or whatever movie a day. And it'll just run. And you can go in there. And there's the cardio machines, not all the cardio machines, there's plenty of other opportunities to cardio, but you want to get in two hours of cardio. You go watch, fucking Will Smith take on the aliens and Independence Day. Which, by the way, if you're ever gonna see me go spend two hours doing cardio like, that might be it. Like that might be really awesome. Take it one step further. And you now make that like new movies. Yeah, now, obviously, you got something I'm willing to pay and pay 20 bucks for, like, that's that all of a sudden kicks ass now is there's a lot of things about that, that are kind of nuts. I've seen gyms, I've seen entire gyms that make a lot of money that have less square footage than that single theater room. But also, maybe it doesn't fit your real estate equation, but it's fucking cool. It's really cool. And I thought that I just think that there's a lot of very novel ideas that work. And then there are some that are so limiting that like poison a brand, one that we've talked about before. Orange theory. Yeah, they're on the struggle bus. So all of a sudden, there's this big retraction, they've lost 40 or 50. franchise, they're like net loss 40 or 50 Over the last year. And that's not going to get better by the way, there's no way that gets better. And I'm going to tell you why. The principle we've always pointed out is the lifetime fitness journey. Right? Someone's going to try lots of different things. And so you can occupy a space in that, or you can occupy a singular space in that or you can provide opportunities to give people lots of room to rattle around in fitness in general. You want to be very general or very specialized. It's really up to you. Orangetheory was very specialized, kind of in what they do. It was a very specific product, they have a good unique fitness proposition which is you're gonna come in you're going to do this you have the heart rate stuff that's like the vibe. Like all things like I've talked about before. Like, you guys know, Ryan Reynolds, right? Well, Ryan Reynolds has been funny and a darling for a long time and I don't think he's ever really stepped out of line but I'm tired of fucking Ryan Reynolds by now. Even though he's charming and handsome and the things he does I probably like most of them. I have no desire to see him in any movies or him doing Ryan Reynolds stick. Because even if you're good, likable, charming, if you're still just kind of the same thing. People get over you pretty fucking quick, especially if it's we're talking famous people celebrities, like you just can't be a darling for that long. And Orangetheory I think was a Ryan Reynolds you like oh, this is kind of neat. You know, it's more fun than I thought. Oh, good. Cool. And then it just only was that because there wasn't more. So people got the orange theory experience until they were Tired of the orange theory experience, and then they just moved on, they don't hang on to it as a thing they come back to. And what happens is I'm going to guess that very rarely do people kind of circle back around into it, once they find their way to something else. So they begin to exhaust their markets, I do think that orange theory got stretched into because they're so specific, I think they got stretched into some smaller markets that they did not, I think they need to be in a very population tense place where they can have again, a shitload of members. But in a class structure, it's tough to do, it's tough to get the bodies in. And so I don't think that in 20 years, we're going to talk about orange theory as a success story and fitness, I'll tell you that, but they had their time, and a lot of things are going to have a time they're gonna rise, they're gonna fall. And I think that's what you're gonna see with a lot of these. I don't see the $10 model going away, as long as investors are continually continuing to be willing to front the big fucking money. And for those of you that are have a gym that you bootstrapped, and started yourself, you don't have any fucking clue. Like I said, I started my gym with my last $30,000. You know, I mean, that was all it took, it was what it was, and we made it work. And we started selling right away. The idea of needing what was the crunch fitness,



36:19

it was something like 600,000



Tyler 36:21

and 3 million. Yeah,



John Fairbanks 36:24

It was millions of dollars. And it's hard, like your net worth, that you had to have did not



Tyler 36:28

include real estate, or any of the actual marketing or any of the actual runway that you needed. That was just to equip the gym, right? So for those of you that are bootstrapping projects, like your Fuck, you're never going to be able to outspend these people, you for a lot, there's a lot of gyms out there that are six months of taking a loss, taking losses away from being closed, a lot of them are a lot less than that. These gyms can come in and run out of net loss for two or three or four years. Most likely the owners are making the real estate play underneath it as well. So they're still getting their rent, it's not actually a net loss for them as a whole. They're getting rent from their own business paying for that real estate. And then in the end, you know, the business is profitable for a while until it's not, they'll just sell it to somebody else anyways, and continue to make the money off of the real estate, it's very likely how that goes. So I just think that you guys are not equipped, not you guys, a lot of gym owners are just not equipped to compete on that level. Because these are the type of people and types of organizations that have a lot of levers installed that they can pull, to get members to get hype to get leads to get foot traffic in the door to sell, sell, sell, sell, sell,



John Fairbanks 37:41

do they're not, they're not playing the same game as you. And we've said this before. So this is one of those things where you don't want to go chasing people that are so far off from where you are, and they're never going to try to be what you are. So just try and be who you are, like to the nth degree. And I think this is where we're going to bring it back then or like full circle to these topics we've talked about for so long. But this is why it's really important for you to double down on what you do, like what makes you unique. And make sure you're doing enough where you're not inside your cave, right? You don't allow tourism to keep you locked away and away from your community. Because if you have the opportunity for these, these guys live near you, because they are beginning people's fitness journeys. They've started this for them. This gives you the opportunity. So what are you all you have to do, you just have to make sure you're throwing lines out into the water for using like a fishing metaphor, but you're throwing lines out by having events giving people excuses to come see what you are. Because then it's like, it's not that there's never a mistake that you aren't them. And so this is why I like our friend Austin right out of California, right he is so double down into like what it is to be a nerd and anime and, and comic book type stuff where those are the events that they're going to throw. Well, he's not only more expensive, so he's not going to compete in that same market as say the Planet Fitness is of the world. And he doesn't look anything like Planet Fitness. But he also looks nothing like CrossFit either. So now it looks so unique and so different, where if I have a choice of someone that I'm on my beginning of my fitness journey, and I feel more confident, and it's either I can go try a new gym because there's a free seven day sweat pass whatever the fuck to go do barbell shit, that rd is still too scary. Or we're gonna go do there's a Quidditch match, which is from Harry Potter, everybody, right? We're gonna do a Quidditch match with a bunch of fucking nerds that look like they're having a blast. They still kind of look like me and they're having a lot of fucking fun and that Saturday, so what's more fun strongman Saturday we're Oh god, they're like throwing up or we're running around with fucking broomsticks and still having like, it's there's such



Tyler 39:55

It's so and I both have the answer. That's not the Quidditch answer. By the way, All right, however, are they seeking people like us? And I think that's really important in regards to how you position yourself in your market, which is like, Who are you actually seeking? And are you trying to say do and offer things to impress people who are never going to do business with you, whether it's online people, whether it's people in your community who, whether it's literally I've seen people do so just to try to like impress or whatever for like their competition, you know, to basically to be like, We're better than that, like that type of stuff. And none of that is really all of all that interesting or compelling to a person who's looking for a gym to join. Right, none of that stuff is all that convincing. I just think it's, I think the thing that you need to do is do your thing, do it well, but to be so naive as to think that there's not fucking good ideas to be had. If you actually like really, really, like, look at these things. Look at what your competition is doing, look at what other business models are doing. And look at them objectively and look at them for opportunities. But you have to look at them to extract the principles at work. Because you can have your movie theater cardio idea that maybe doesn't take 3000 square feet of your space and a $10,000 setup in addition to the equipment, you know, all of a sudden, you're looking at just a $50,000- $60,000 idea that if nobody likes us, it's just burned. So there's plenty of other opportunities like that to be had. And so I got a jet here pretty soon, John. What else did we have? We had a crunch , we had a planet we did want to touch on the orange theory stuff. By the way, do you think CrossFit is going to go the way of this orange theory thing? In a long enough timeline?



John Fairbanks 41:50

I don't. And the reason why I don't think CrossFit is is because CrossFit has had to evolve naturally over time to do small group to do personal training, like if you like if they were gonna stay trickly, we're just group classes, this is what we do, we don't do pull ups be kipping. And then you don't make it. They don't make it. Because then you are just a fad that was popular, people got hurt, people didn't like the cultish nature of the thing. And that's where I don't know actually, because thinking about the CrossFit boxes that we've been involved with in those gyms we've worked with, how many of them want to be like, I'm trying to do everything I can to combat the name that's on the front of our spot, we have to do personally, we have to prove that we're more reachable by soccer moms and those types of people.



Tyler 42:42

I agree with you too. And I also think it's I agree, especially in that hopefully a lot of these CrossFit affiliates, coaches, owners, people that are doing the programming understand the actual principles of CrossFit was founded on not the principles that are referenced that they use to like, there's some things that they do in group classes and for programming that are in conflict, or just kind of like bastardization of the actual fundamentals of CrossFit constantly varied, functional movement, high intensity, right? Then you have like, some really dumb ass movements, and some really stupid shit. And some like kind of borderline dangerous shit, most of that is done just to jam those principles into something that you can do in a group class, right? And then still have it be, don't get me started on the Olympic lifting with all that stuff. It's dumb. It's whatever, it's a thing that can be done, but it's just too specialized and stupid. It's not like we're going to try to make that mainstream. But the nice thing though, that I think CrossFit does have working in its favor, is because it is constantly varied, it is a diverse form of fitness. And once jimoh CrossFit owners and affiliate owners and coaches stop programming everything to be for time, or for reps, which was never the case, by the way, that is only a thing to make it be competitive. The moment people can actually go like, Oh, because it you're in real fucking programming that fits as you're gonna come in, and you're do five by five on your back squat after your warmup. And that's going to be today's workout. And then two days from now, you're gonna go we're gonna warm up, you know, get a little loose and we'd run a 5k then the next day, we're gonna do a Metcon that's, you know, 12 minutes of really silly shit, you know what I mean? And then the next one might be some heavy this or that? Is that what it is like actually can look like actual training? But if everything is three to one, techno music, I hate to break it to you, but you're gonna go the route of fucking orange theory. Because that kind of sucks. That's the stuff that people can kind of get hooked on. It doesn't really work. So again, it's all about what are we optimizing for? Are you optimizing just for the fact that it's a group class? are you optimizing for the intention that other people have when they come in or their initial impression, so you're just going to give them that even though that's not what you do? Well, that sucks. So I do think that CrossFit will be resilient enough as a training methodology, the brand as a whole, like the actual business structure I got my doubts about, but I don't believe that CrossFit will go away. Even if CrossFit HQ melts down completely, the cross company goes away. I don't believe that that type of training will go away. So yeah, I guess that's our take on that, that I haven't thought too much about, I guess. But



John Fairbanks 45:27

no, but And again, the button it all up is if you're a gym owner, do not get stuck in your own spot. Look at what other people are doing. Look at go to the biggest, shiniest, fanciest gyms that are out there and look at them, even if it's just online, what are the things they're doing? What are the perks were the things, it doesn't mean that you're going to be able to put in the days and every single one of your toilets and whatever the stuff is, but like what are like you said, the principles that you can extract where it's like, we could do our own version of this, or it's not a staple in the gym. But we can make this an event where we can make this something we can do something that allows us to be seen as different, because most of you that are listening, your desire to be great is there. But if you live in a world that is uninspired, where frankly, Tyler where you and I both live, it's not the same place, but it's equally uninspired. If you have nothing but inspirational motherfuckers that are around you. It's such that you are dry of creativity and desire to want to do something cool or different or unique. Yeah, because



Tyler 46:25

mediocrity can still pay. And it's a lot fucking easier. But yes, let the gym owners revolution we are talking about if you're better than that. Follow us on all the things. The gear and the gym owners revolution Facebook group, that link is going to be in our show notes here. You want it on the gear academy that should be in there too, or go to gym owners. revolution.com you want to work with us directly. You can either shoot us a message, or just go to gym owners revolution.com So thanks a lot for listening. Everybody follows the show at the gym owners podcast on Instagram. Follow me at Tyler Elphinstone. Is Tyler eff ironstone John,



John Fairbanks 47:00

and you can follow me on Instagram at Jay banks f L. All right.



Tyler 47:03

Thanks for listening, everybody. We'll see you next week.
































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