With the evolving competition in the different industries, the fitness industry in the UK has also undergone some changes with its emerging competitors that are giving a tough competition to the emerging brands following fitness. This report elaborates the various strategic management that must be implemented in order to acquire a fruitful position in the fitness market and a thorough analysis of the competitor analysis with the help of few traditional tools that will essentially help in discovering the necessary market threats which are considered to be the threat to the fitness industry.
A detailed analysis of the fitness industry using different standard strategic tools reveals the industries face certain threats and challenges but again it has opportunities that the fitness industry can capitalize in order to have an edge over the competitors in the industry. The fitness industry has ample scope to bring about a revolution in the market if the marketing strategies can be taken properly and decisively after understanding the needs and demands of the market. In the end, several recommendations have been made for the fitness industry which if the industry employs then certainly can give momentum to the industry especially in terms of marketing.
The societies that are contemporary in nature generally face various challenges that arise from redefinition and refocus of the consumer mentality and their perception of viewing a business. In the present age, an essential goal for all the consumers of all ages compared with social segmentation is mainly lifestyle adopted, which must be as healthy and fit to the most possible extent. Therefore, with the introduction to the various fitness centers, the attention to various changes and the present developments in the lifestyle, preferences of consumers, and the rising entrepreneurs in the fitness industry are continuously trying to benefit from this increasing wave of amplified demand for certain fitness activities. In support of the services, the value of the core business service offers points of differentiation and also creates a competitive environment over the competitors (Polyakova and Mirza, 2016). It is apparent that fitness industry has significant presence in consumption activities of the British public and constitutes a major part of the UK economy. The fitness instructors are regarded as the prime employee group within the fitness sector thereby maintaining interaction with customers in direct terms in provision of the ‘product’. In recent times, the fitness industry of the UK can be seen to try to show a strategic growth in aggregate terms in order to cope up with the switch over of individuals to attainment of a healthy lifestyle on one hand and survive the existing level of competition on the other.
The report that elaborates the strategic management and competitor analysis in regards to the organization of the industry overall that faces various issues along with the market changes and narrates the various strategies that can be implemented in order to address the changes and help the industry or the organization to survive the changes rather getting succumbed to it. Besides, the strategic tools are explained and will also be taken into consideration for the feasibility of the business to operate in the UK (Chekhovska, 2017).
2. Strategic Framework and Competitor analysis
A strategic framework is required to thoroughly analyze the different strategy plannings that are required within the fitness industry in order to make a mark in the market (Macon, 2020). An in-depth analysis of the competitors is required in the fitness industry to understand the strengths and weaknesses of the competitors and according to that plan a strategy that can give a competitive advantage within the fitness industry.
2.1 PESTEL Analysis
The PESTEL framework is an efficient tool primarily used for the external analysis of the company or industry on six key vital parameters that generally affect the working of the industry or company (Mäkelä, 2019). The six key vital parameters are political, economic, social, technological, environmental, and legal. Each of these parameters has a significant impact on the overall fitness industry.
The political parameters have a vital influence on the fitness industry and on its operation. The political scenario has a profound impact on the working of the fitness industry. A stable political atmosphere generally favors the smooth working of the fitness industry, whereas an unstable political atmosphere greatly affects the working of the fitness industry.
The economic parameters have a key role in deciding the smooth working of the fitness industry. A positive economy generally favors the smooth working of the industry and helps to create more opportunities in terms of employment. Again a slowdown in the economy generally affects the working of the fitness industry and also results in an increased rate of unemployment.
The social parameter helps the fitness industry to get an idea of the demographics which helps to get an idea of the views and values of the potential customer base. The social factor largely determines the acceptability of the fitness industry.
The technological parameter determines the technological advancement of the fitness industry. The increasing trend of adopting new technological innovations has resulted in new and unique products and services offered by the fitness industry. This helps to get a competitive advantage over the competitors.
The environmental parameter is an important factor that helps in the sustainable development of the fitness industry (Dadzie, 2019). The fitness industry needs to remain vigilant that it does not affect the environment in any manner during its operations which can have a serious impact on the people. The environment-friendly approach of the fitness industry can give it a positive growth.
The last parameter is the legal parameter which needs to be taken due care by the fitness industry. The fitness industry is bounded by many rules and regulations that it needs to follow strictly in order to operate smoothly without any legal hassles. Proper health and safety regulations are a must for the fitness industry.
Figure 1: PESTEL Analysis
(Source: Fernandes, 2019)
2.2 Porter’s Five Forces
Porter’s five forces as identified by Michael Porter is also an effective tool for strategic analysis as well as analysis of competitors at the industry level. There are five principal forces which are, (i)Threats from New Entrants, (ii) Bargaining Power of Suppliers, (iii) Bargaining Power of Buyers, (iv) Threat from Substitutes and (v) Competitive Rivalry.
(i) Threats from New Entrants: The potential threat of a new entrant in the fitness industry is considered relatively low as a huge amount of investment is required along with additional expenses in terms of operations in this industry to get a start. Along with that considerable experience and skilled manpower is required in the fitness industry which the new entrants in this industry lack the most, as a result, they fail most of the time to make an impact in this industry.
(ii) Bargaining Power of Suppliers: The role of the suppliers in the fitness industry is quite pivotal and decisive. The suppliers are the ones that manage as well as procures the resources for the fitness industry and also look after the distribution channel. They often help in the promotion of the goods and services offered by the fitness industry and also helps the fitness industry to earn a reputation in the market. Now the bargaining power of the suppliers in the fitness industry is considered moderate as there are numerous suppliers that supply the same line of products at the most affordable rates.
(iii) Bargaining Power of Suppliers: The customers are the main force that determines the success of the fitness industry. As a result, the bargaining power of customers in this industry is considerably high as the customers are the ones who will make the final call when it comes to avail a good or service from the fitness industry (Nikolić, Vesić, and Cogoljević, 2019). The changing needs and demands of the customers need to be taken due care by the fitness industry as they know the customers have a lot of options to choose from in the market.
(iv) Threat from Substitutes: There is a considerable high threat from substitutes in the fitness industry. It is due to the fact that relevant knowledge and resources are nowadays readily available in the market. People often have easy access to information about the different substitutes available in the fitness industry and also have the capacity to compare them based on their specifications (Kingsnorth, 2019). There are some other factors that enhance the threat from the substitutes and that are the easy availability of products and services under the fitness industry at the most affordable prices.
(v) Competitive Rivalry: The rivalry among the competitors is quite evident in the fitness industry as there is a large number of competitors in the fitness industry which are constantly evolving to stay ahead of others. The growing competition usually shrinks the market and makes it quite challenging for the smooth operations of the fitness industry.
Figure 2: Porter’s Five Forces
(Source: Frenzel, 2019)
Evaluation of the different plausible scenarios
The different plausible scenarios in relation to the fitness industry would majorly consider the future of the fitness industry especially in the market structure of the UK along with marketing strategies and the production facilities of the fitness industry at its very initial phase of starting or enhancing the business (MacFarlane et al., 2019). The fitness industry do exists to serve humanity, the assertion to fitness is an important component of health and mental fitness, longevity and well being, the fitness industry mission is to make the world turn healthier with regular fitness promotions with appropriate strategies and competitor analysis that would help in making the different brands prominent to the existing competitive fitness market of the UK, where people are usually fitness freaks (Kayser and Shala, 2020).
Figure 3: Growth of Fitness Industry (UK report)
(Source: Kayser and Shala, 2020)
This has led to an impressive enhancement for the industry on a global scale. In the US club attendance has increased by more than half in the past 20 years and in the UK it has grown by 3% in the specific years to march 2019. With the recent concept of wellness and mindfulness can be seen as becoming of more importance for consumers. It has become a goal relevant to the future of many of the masses. Work executed by the LatentView Analytics observed more closely at approximately 150 million points of data including information on the various range of products, its usage, reviews as well search items along with the conversations over social media over the past 10 years (Swaid Khanfar and Loudon, 2019). The very data actually revealed the major ongoing trends in the fitness industry. The community in the gymnastics workouts is considered to be the top motivators for the consumers to visit the gym (Dutchak and Chekhovska, 2018). The development in the technological aspects in relation to the fitness industry is consecutively growing and the consumers are responsible for driving the growth. Although the technological improvements are usually not spurring more interest in the home working outs, fitness applications are widely used at the gym and other sectors that are responsible for keeping people healthy (Yong et al., 2018). The future of the fitness industry is booming with a huge hand of competition as well. Other plausible scenarios would involve marketing development in the sphere of fitness where it will play a major role in promoting the features and capacities of the specific brands or companies in operation in the UK market (Vorobiova, 2019). With the stronghold in the marketing sphere, the analysis in terms of competition can be established well for the fitness providing brands. The entire report dealing with the marketing structure of the fitness industry helps in narrating the various strategies that would be considered beneficial in promoting the brand and its offerings to the consumers.
Figure 4: the UK Gym Market
(Source: Vorobiova, 2019)
Considering the previous few years, the masses have encountered a massive growth in consumption and cognizance of preventive healthcare across the different age groups and in terms of their level of income. A huge reflection of this is the 20 million unique searchers on the monthly scale taking place on search engines that are linked to ‘fitness near me’. As per industry studies like FICCI EY report, Global Wellness Institute, IHRSA, Redseer Consulting, and Fitternity’s grounds-up investigation of the Indian retail fitness administrations market, there are 6,000,000 dynamic clients in India who are spending on a normal $350 to $400 every year towards the fitness services, adding up to $2.6 billion market size. With a huge influx of fitness centers in most areas, the consumers or the users are now exposed to the slew of brand new options as against the minimum they had to opt for a few years ago (O’Brien et al., 2019). The sole decision to join in that was essentially based on the pricing has eventually now evolved to understand what are the trending factors, and henceforth evaluating the vibe. Marketing as the plausible scenario has made it possible to gain this much prominence of the mentioned industry and the brand concerning it.
Nature and characteristics of strategic issues and problems in relation to the fitness industry
Strategic decisions are those that provide an overview of the organization’s strategy. There is no second thought that organization strategies have a major impact, especially in the fitness industry. However, when it is the question of decision making strategically things usually tend to get a bit difficult. Not all the plans that are future-oriented have to be the appropriate strategic ones. In order to develop worthy strategies for the fitness industry, it is important to comprehend the real nature of strategic decisions (Laamanen et al., 2018).
The General Characteristics of the decisions usually bears a long term of impact in the business, It also provides decisions to enhance the future directions, It usually has an overall impact on the entire organization along with the scope of its activities. The fitness industry has its own numerous rivals in the UK that are continuously trying to set their names at the forefront of all the other emerging brands. The true strategic decisions usually occur not on a frequent basis. They are preferred when the top management identifies any new opportunities or any market threat. Decisions are generally taken at all organizational levels (Fredriksson and Pallas, 2016). They contain a varying impact on the business. From a more general viewpoint, a distinction is usually made between strategic, operational decisions, and tactical decisions. These nature and characteristics usually have an impact on the industry. Therefore, with suitable strategic management and competitor analysis, the brand can flourish with high demand in the world of fitness by implementing essential marketing strategies that would help in recognizing the various change factors that are occurring in the real market sphere of the market especially in the competition of the fitness industry (Bressan, 2018).
Internal and external analysis using Tools for marketing
The SWOT Analysis looks into the internal and external analysis of the fitness industry in detail. This tool is employed to analyze the strengths and weaknesses of the industry internally, as well as the opportunities and threats of the industry externally. This tool helps to get an image of the fitness industry’s competitive advantage as well as the strategic position in the market.
Strengths: The main strengths of the fitness industry is its potential to deliver top class products and services to all. The capital power of the fitness industry is another strength that gives it a competitive advantage in the market. The fitness industry provides ample opportunities in terms of employment. The locational advantage of the fitness industry is also regarded as a major strength as it can have a number of outlets spread across diverse locations.
Weaknesses: The main weakness of the fitness industry is the incapability to exploit the prospects of digital marketing especially marketing over social media in order to reach out to a larger potential customer base. Another weakness of the fitness industry is to communicate its value proposition properly to the consumers (Freitas and Lacerda, 2019). Inadequate pricing strategy is also considered as one of the weaknesses of the fitness industry.
Opportunities: There are diverse opportunities that are left to be explored by the fitness industry. One of the main opportunities of the fitness industry is to bring in innovative technologies that help the industry to offer unique products and services (Teodora and Anatolie, 2019). Another important opportunity for the fitness industry is to make its presence felt on the digital and social platforms and accordingly adopt unique marketing strategies.
Threats: One of the vital threats of the fitness industry is the rival competitors who are technologically advanced and possess alternative marketing strategies. The companies which are constantly evolving with time are also a constant threat to the fitness industry.
Figure 5: SWOT Analysis
(Source: Wei, 2019)
Identification of the strategic issues
Collaboration and sharing are considered to be commonplace in today’s world driven into mainly the sphere of social media presence. But the lack of regulation means it will become easier for people to share enormous amounts of information based on health, fitness, including anything and everything without factual backing. In combination with various standard challenges in order to keep the clients motivated, there are various problems in the fitness industry that indirectly or directly affect the business. The first factor can be misinformation where the internet hosts some useful health and fitness information, along with some bad or harmful advice too (Broch et al., 2018).
The main problem is that for the concerned mass who may find it difficult to trust the variedness of information regulated believing the authenticity of the information. There is a lot of inadequate information that is usually spread through the internet and the very medium of social media is evident to few fitness professionals and trainers, any average person might not have the same level of intensity of knowledge concerning the field of fitness. This usually does not simplify that all the online sources stand out to be incredible, but somewhere it does highlight that any lack of regulation can lead to becoming misinterpretations. Prioritizing education in the fitness industry will help promote helpful, authenticity, and evidence-backed suggestions across the social media platform and during any interaction with the clients. Honesty will pave its way and help in holding the position for the fitness studio as being one of the leading authorities that will eventually help in building trust, a member base, and loyalty for the consumers. Following the one way approach that elaborates social media to be an excellent pedestal when it comes to finding the like-minded crowd bearing similar sorts of interests. This notion is brilliant because this helps in finding a community of the ones that support and share the same passion. Keeping in mind that each of the members holds significance will help in finding the real market analysis where people will differ in their goals, lifestyles, and different motivations along with their preferences. Considering the Elitist attitudes, fitness must be accessible to all, but to a disappointment, fitness centers are welcoming beginners, the know and not know crowds are segregated, that provides a false sense of moral superiority that actually does not help anyone. These very forms of attitude discourage the new crowd from coming into the world of fitness.
Customer Relationship Management (CRM)
CRM is popularly referred to as a strategy or process that assists organisations to effectively manage relationship with that of suppliers, vendors and customers at large. Implementation of CRM enables salespeople as well as business owners streamline the sales process thereby improving interdepartmental collaboration and maintaining business relationships. Taking the fitness industry of the UK into consideration, it can be said that the primary motive of fitness organisaations is not just fitness but to maintain a good relationship with clients by providing excellent services. Thereby, installation of a robust CRM system often helps improve most critical aspects of customer service program leading to attainment of better experiences as a result.
CRM proves beneficial for the concerned fitness industry in the following ways:
- a) Helps reduce frustration of both employee and member: At times, fitness organisations can be seen to suffer from inefficiencies as a result of manual working that have become a source of frustration on part of customers and employee alike. For instance, simple administrative tasks involving actual paperwork can be seen to have led to major headaches as a result of human error. On this note, adoption of ABC Financial Software often proves to be effective in this regard to eliminate tons of man hours otherwise would be required to be performed that no one likes to perform. Access to the online portal makes it easier to manage all data in a systematic manner and modify them if needed as per convenience (Miragaia and Constantino, 2019).
- b) Helps analyse data and track data on an expert level: It is to be noted that installation of CRM such as that of ABC Financial Software can be seen to have been of great help in relation to allowing the fitness organisations to develop an understanding about the members at a microscopic level thereby providing an opportunity to be a better marketer as well as an operator. Thus, analysis and tracking of data at an expert level is exactly the thing a good CRM system is specifically designed for.
- c) Helps get access better enrollment features and create unique links: Another prime CRM-enabled sales feature that can be seen to gain acute popularity is carrying out the online process via online mode. This, as a result, provides provision to the prospects to attain gym membership 24/7 through the specially designed website using CRM software thereby acquiring profit margin as per the level expected.
Critical analysis and implementation of marketing strategies
A detailed critical analysis of the marketing strategies reveals that the fitness industry has failed the most to utilize the concept of marketing on the digital and social platforms. These platforms often provide a greater and wider reach among the potential customer base and also helps to communicate the messages of the fitness industry more efficiently to the consumers (Köseoglu et al., 2020). As per recent analysis, rapid changes in customer expectations and digitalization are leading to transformation of leisure sectors or consumer goods to a large extent. This has clearly been evident from the fact that digital aggregation can be seen to play an important role on part of fitness providers for winning over new clients as seen across a plethora of other industries. Thereby, this demands a shift on part of the fitness industry to offer its consumers a pick and mix or rather an on-demand approach to access a gym providing them assurance to the fact that they are able to get the most out of their money in a way. This involves enrolment in platforms such as PayAsUgym or ClassPass such that better results can be obtained.
A proper and effective marketing strategy focusing more on digital and social media marketing can indeed keep the fitness industry a competitive advantage over the competitors. The implementation of marketing strategies by the fitness industry requires proper market segmentation to understand the needs and demands of the customers which prove to be a decisive factor in effective marketing strategy (Friedl and Biagosch, 2019). The market segmentation is generally done on four parameters and they are demographic, geographic, psychographic, and behavioral market segmentation. This market segmentation helps the fitness industry to understand the views and outlooks of the consumers and in turn helps the fitness industry to serve them better and more efficiently (Vieira and Ferreira, 2020). It also helps the fitness industry to diversify within the market.
Amid this, the fitness and health industry of the UK is shifting its footing rapidly in order to making optimum utilisation of such opportunity. However, assertion of low-cost gyms can be seen to consistently challenge key incumbents of the industry. Such middle-grounded option is becoming somewhat endangered owing to prevalence of certain barrier on its part to expand in various other economics of the world. This, in a way, automatically comes in the way of generation of profit margin as per the level expected. Taking this fact into consideration, it can be stated that as low-cost segment becomes competitive on a large scale, operators associated with fashion industry can be seen to strive for acute differentiation which imposes a problem on part of the trainers or the management concerned to think of better training offers as well as technological upgradation guided by the sole motive of creating better customer experiences. In addition to this, bringing about capitalisation is reported to have become a necessity on part of organisations associated with the gym sector of UK as a result of the fact that customers, in recent times, can be seen to prioritise their social experiences to a large extent. This can duly be supported by referring to the fact that around 40% of the consumers consider social scene to be an important part of selection process, something which grows to 50% for premium gym-goers and nearly 60% for those who attend classes.
The market strategies by the fitness industry should be able to frame a proper value proposition for the industry and be able to convey that among the stakeholders as well as the consumers. The marketing strategies of the fitness industry should be implemented in such a manner that it is able to convey the social importance of the industry in society. The fitness industry should be able to market the principles of good health and fitness among people which turn out to be the unique selling point (USP) of the goods and services offered by the fitness industry. This can help the fitness industry to have an edge over competitive rivals in the industry.
Figure 6: UK Fitness Industry Report
(Source:Miragaia and Constantino, 2019 )
The following recommendations can be suggested to the fitness industry for having a strategic as well as a competitive advantage over the rival competitors in the industry:
- The fitness industry must make a proper analysis of the target market. This needs to be done in order to frame a proper market strategy. The analysis should focus on the different types of people living in a locality especially the focus should be on the age category in order to suggest a proper fitness regime as per the age category. This is crucial for the fitness industry in order to get success.
- There should be proper monitoring of the quality and specifications of the equipment manufactured by the fitness industry. Proper care should be taken care of the designing of the equipment that should not take up too much space in a room. The feedback of the customers should be taken seriously by the fitness industry. This will indeed help the fitness industry to achieve positive growth.
- The fitness industry should stress the fact that proper and effective communication is established between the customers and the industry to understand the needs and demands of the customers. This will help the industry to earn the trust and loyalty of the customers towards the fitness industry.
- The fitness industry should look forward to bringing innovation in marketing campaigns. The industry should focus more on the concept of digital and social media marketing strategies. This will help the fitness industry to establish a more firm and effective foundation in the competitive market.
- The fitness industry can expand business operations by collaborating with like-minded companies. This will indeed help in building a formidable ground in terms of marketing for the fitness industry. It will also help to increase the available resources in terms of capital and skilled manpower.
This particular report analyzed the fitness industry in great detail. The report also focussed on the plausible scenarios of the fitness industry. The strategic issues of the fitness industry are also looked into and analyzed using the strategic tools to get a better picture of the strengths and weaknesses of the fitness industry. The threats and opportunities within the fitness industry are also explored. The marketing strategies of the fitness industry is also analyzed quite efficiently to understand the shortcomings within the marketing strategies of the fitness industry. The analysis helped to make recommendations to the fitness industry to bring over a change in the marketing strategy to get a competitive edge over the rivals in the industry.
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