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Health and wellness
businesses face
tough decisions.
- If your current programs
target women,
should you grow
by adding programs
tailored to
guys?
- If you run
a fitness center,
should you lower
your prices
when LA Fitness
opens a new
club?
- And should
your yoga studio
emphasize spirituality
- or drink
the corporate Koolaid and
starting calling
asanas "exercises"?
If you choose a
strategy that's
poorly matched to
the capabilities
of your business,
you're signing up
for a rough ride
that can jeopardize
the profitability
and longevity of
your company.
Consider these
factors as you
decide which
strategy best
matches your
wellness
business:
Growth Strategy
#1: Operational
excellence
These businesses
focus on closely
managing their day-to-day
operations - the
nitty gritty of
getting customers
and providing services
to them. They tightly
manage costs and
productivity so
that they can maintain
profitability while
selling at low prices.
While their profit
on each customer
is relatively small,
the objective is
to sell to a very
large number of
customers.
Examples include
24 Hour Fitness,
Bally's and other
discount health
clubs, plus mass-market
weight management
programs like eDiets
and WeightWatchers.
In other industries,
examples include
Wal-Mart and McDonald's.
If this is your
strategy, your wellness
business must :
- tightly
control all
costs
- standardize,
streamline and
automate processes
as much as possible
to reduce employee-related
costs
- incent your
employees on
quantitative
financial and
non-financial
targets, like
number of new
members
- aggressively
use technology
to reduce labor
costs
That's why discount
health clubs don't
offer towel service,
tightly manage the
performance of sales
reps, and like "walk
and wave" check-in
processes. And that's
why they don't usually
hire floor staff
or offer free child-care.
Growth Strategy
#2: Innovative products
& services
These businesses
offer health and
wellness programs
and services that
customers will see
as unique and/or
hard to find.
These businesses
enjoy clients who
are more loyal
and willing to pay
premium prices.
Examples include
yoga for pets and
Equinox health clubs
which combine a
high-end trend-setting
fitness atmosphere
with luxury retail.
If this is your
strategy, your wellness
business must:
- have genuinely
creative and
innovative programs
and services
- seek out
extremely capable
and innovative
employees who
are creative
and think out
of the box
- emphasize
strong marketing
and marketing
communications
skills
- emphasize
continuous improvement
of your programs
and services
- incent your
employees on
subjective measures,
like client
loyalty
That's why the La
Palestra Center
for Preventative
Medicine provides
only personalized
programs that emphasize
goals like hiking
Kilimanjaro and
Mount Everest -
in a setting that
includes private
changing areas with
glass showers.
There's no price
list, because every
client's different...but
you can bet it's
not cheap.
Growth Strategy
#3: A niche focus
The goal here is
to tailor your marketing
to a particular
market segment while
offering health
and wellness products
or services that
are otherwise widely
available.
These customers
may be price-sensitive
(as in Strategy
#1) or they may
value innovation
(as in Strategy
#2) - but their
loyalty is high.
Curves is an excellent
example of a niche
strategy.
Their equipment
is nothing special
- but their marketing
speaks to overweight
middle-aged women
in a way that few
other wellness businesses
can match.
If this is your
strategy, your business
must:
- have an
exceptionally
good understanding
of your target
market
- strong marketing
and marketing
communication
skills
- strong cost
management skills
OR
strong innovation
capabilities
It's no accident
that Curves has
invested heavily
in marketing knowledge
and technology.
For example, they
work with multiple
ad agencies to create
marketing materials
tailored around
cultural nuances
for individual countries
- and they've got
technology that
can quickly produce
those materials
in everything from
English to Hebrew,
Arabic, and Asian
languages.
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