Making the gym work out for you

Derek Burke, Dubai-based sales director at premium fitness equipment supplier Precor, explains the revenue generating opportunities presented by secondary spend.

Crucial to the success of any hotel fitness facility is treating it as a separate profit centre, but maximising the revenue it generates can be a challenging task, especially in the current global economic downturn.

With all businesses in the Middle East striving to work more efficiently and maintain robust profit margins in a tough marketplace, developing secondary revenue streams can be key to a gym’s profitability.

The theory is a simple one. Once you’ve attracted a customer to your business, utilising every opportunity to encourage them to spend more can have a dramatic impact on your bottom line.

What’s more, enticing customers to get more out of their visit — whether this be via a trip to the spa or restaurant, a personal training session or purchasing a supplement to increase muscle gain — offers them tangible benefits that will keep them coming back.

Shout about it
Increased yield from your customers, be they hotel guests or pre-paid members, can stem from a number of avenues. Don’t be afraid to shout about additional services and add-ons.

Living and working in the region, I know first-hand that a pool and gym are now de rigueur in Middle Eastern hotels, with even mid-market and budget chains realising they’re a modern market expectation.

And hotel guests accustomed to such facilities won’t be put off by cross-selling. In fact, they’ll expect nothing less than to be told about the complimentary services that complete your wellness offering and further enhance their experience.

Perhaps the most obvious and cost-effective link is with the hotel spa. The vast majority of Middle Eastern hotels now offer spa facilities and encouraging guests to follow their workout with a sports massage for example, will be a seamless step for them, yet it doesn’t incur additional spend on buying in stock or recruiting extra staff.

The same applies to promoting other areas of your business, such as the restaurant — ‘post-workout’ specials on the lunch menu or a range of freshly-made fruit juices and smoothies can be all it takes to lure your gym goers to spend money on food and beverage.

Personal training is another tried and tested revenue generator, which links intrinsically with your fitness offering.

Already well established in the UAE, one-on-one training sessions are an increasingly popular way for hoteliers to challenge and motivate guests and members.

From a revenue point of view, bespoke training programmes mean results, and results mean retention. And in a region where hotel gyms are very often unmanned, it also provides a point of contact between staff and customers, and so the opportunity to personally up-sell other profit centres.

Don’t be afraid to promote seemingly diverse areas of your business, as well. I recently saw a flyer in a Dubai hotel gym promoting the meeting and conference services. As a result, I mentioned it to my local events manager who went on to arrange a conference there. Simple, yet effective.

Make the most of merchandise
The opportunities for cross-selling are endless; from protein and whey supplements that aid strength training to isotonic drinks that improve hydration, tracking gadgets such as pedometers and watches, to breathable sports attire.

It’s much easier to sell add-on products if they provide a direct benefit to someone’s training, especially if these items are understood by the customer to be essential — for example, if a personal trainer explains how a supplement will complement weight loss or a specific watch can help monitor energy expenditure.

They all generate extra income for your business, but with the additional benefit of improving the results your customers gets from training in your facility, therefore enhancing their overall experience.

Merchandise may involve small risks in terms of investment in stock, but if you know your gym goers and tailor products to them, the resulting secondary spend can and will push up annual turnover.

Retail needs to be as effectively thought out and managed as the gym itself, taking into consideration key factors such as customer demographic. For example, if your hotel and gym caters to high-end clients, selling top-of-the-range training watches may be appropriate.

But if your guests have a lower level of disposable income, it makes sense to offer products at a more fitting price point. The mark up may be less, but the overall sales figures are likely to be higher.

Strike a balance
Generating multiple profit centres involves one crucial activity — selling. Staff need to be trained in sales and customer service in order to recommend the right product for each customer, without being too forceful and putting them off.

Ensure all gym staff know the products and recommendations inside out and, if possible, encourage front-of-house staff to do an induction in the gym so they fully understand the service and additional offers.

If your gym is unmanned or you’re looking for an additional platform to promote secondary revenue streams, personal viewing screens offer a solution.

They provide the opportunity to create a dedicated hotel channel or bespoke digital signage that appears while TV channels are loading or at the end of a workout, encouraging guests to follow their gym session with a swim and light lunch or cocktails at the restaurant or bar.

Equally effective additional options include point of sale (POS) materials such as posters and leaflets, which should be strategically placed around the entire facility.

For instance, take advantage of the space on changing room lockers and mirrors to place posters advertising personal training sessions. Or consider placing spa treatment menus or healthy restaurant leaflets on the gym’s reception desk.

When positioning your POS think about your guest’s journey through the facility and where they pause; it’s at these points that you’re likely to have a captive audience.

In the same way digital signage is effective because people focus on the screen when working out, placing posters at the water fountain or reception means your audience will be more receptive to your messages.

Hotel gyms that dare to be different will be the ones that benefit from increased secondary revenue and bolster their business through the recession.

Stocking appropriate products and providing links to related services will ensure your customers see the gym as a one-stop-shop for their health and fitness needs.

There’s no doubt that the rewards are there for those willing to invest the time and energy into getting this area of their offering right.