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Transcription – Brian Zehetner Show 196

Chantal:          Brian, welcome along. Thank you for joining me today.

Brian:               Thank you for having me.

Chantal:          So, we’re actually doing today’s interview live, which is quite unusual for me. Most of the time I don’t get to sit opposite my guest. We’re normally looking through a computer screen. And for those of you that don’t know, we’re actually sitting currently at the Motion soft Technology Summit 2018. Brian did not one, but two sessions this morning. It’s been a very busy morning for you and I’ve managed to grab you for a very quick interview. So, thank you so much for taking the time to chat to all of us today.

Brian:               Yeah, happy to do it.

Chantal:          So, I wanted to obviously, we’re here talking about tech, so it makes sense that we continue on that type of topic. I’m interested to understand from your point of view what technology demands that you are currently hearing from your customers?

Brian:               Yeah, I think traditionally where I work now, we haven’t necessarily had a strong technology imprint within the clubs. And so, I think we’re starting to figure out that members are looking for additional resources. They want additional solutions that can make like sort of the fitness experience easier, more intuitive, user friendly. Like how can you help me get to whatever goal I may have? Obviously we have to identify that first. And so we’re doing some work in that regard too. But I think, so we’re sort of starting with, we’re kind of undergoing a digital transformation, so we’re starting with creating sort of this integrated layer via API so that we can connect all of our [inaudible 00:01:27] systems together, right? All of our technology seems to be operating in these silo groups. And so we want to kind of create that integration layer, everybody integrates in with us, and then we can decide how the data flow is and where it flows to, and that sort of thing. So, that’s part of it. And then one of the things that I’m working on more specifically is sort of re-imagining the mobile experience. And I think that’s really important.

And so, when you think about consumer specifically and our members, they’re really looking at mobile, because it really is the engagement hub for them. So, they want a pretty robust experience, and that could be related to onboarding, checking into the club, obviously the fitness experience. Maybe it gets more broader than that down the road in terms of wellness and incorporating nutrition or mindfulness and community elements and things like that. All in due time. I mean, we can’t do everything from the get go, so we’re going to start with sort of a B1 and then progress from there.

Chantal:          Now you mentioned that kind of full integration hub that you’re building.

Brian:               Yeah.

Chantal:          I mean that sounds like a project that’s bigger than anything. I imagine that’s a huge investment for the company.

Brian:               It is. That’s correct.

Chantal:          For you to have gotten to that point where you’ve made that decision and you’ve gone, “This is something that we need,” how do you get to that point? How did you understand what it is that your customers want from a technology standpoint, and what’s that tipping point that you go, right, rather than working in silos like we have traditionally, we actually need to make this investment and this commitment, I guess, to providing or creating this integrative platform that you talk about.

Brian:               Yeah, I mean a lot of that, Craig Miller, our Chief Digital Information Officer, he sort of talks about this integrated data layer, this API layers as sort of like digital plumbing. Right? That’s his term for it, right? So, it’s not anything that necessarily the members will see. They’re going to see the mobile app. They’re going to see some in-club displays or some media on the walls like with advertising or with exercise programming and things like that. So, they’ll see though as touchpoints, which is great. But they’re not going to see sort of this plumbing, right? They’re just going to know that everything works, and it works seamlessly. I don’t need three different logins to get into mobile. Or I don’t need two different logins to access the web experience, and things like that. So, we really just want to simplify things for them. And I mean, who doesn’t want things simplified, right? At the end of the day that’s really critical.

And I do think, we’ve done a lot of consumer research to try and figure out what our members do want, so we’ve looked at working with third parties on the customer segmentation side. We’re doing some journey work. Well, if that’s sort of the macro level, like take into account all the potential touchpoints from even before you come into the club to the onboarding process, through the fitness experience, and then even after that. And then we also are looking like sort of personas and trying to figure out okay, how do we appropriately bucket people? And then once we do that, maybe we can get into some more personalization and get down to that individual level.

So, it’s all a process and it really comes down to market research. And I think we’ve invested a lot there and it’s provided a lot of great insights, some that we were very aware of and maybe some that we weren’t. So.

Chantal:          I’m keen to understand the market research piece a little bit better, but before we do that, I want to kind of rewind just a little bit because I’ve come in here assuming that most people will know Planet Fitness, but I think it’s important that we give everyone a bit of an overview about the business.

Brian:               Sure.

Chantal:          If someone has not stepped foot in a Planet Fitness venue before, tell us about what they would expect as they walk in the door.

Brian:               Yeah. I mean that like, we sort of pride ourselves on the judgement  free zone. Right? So, you walk in and what you see is a tonne of really high quality equipment. You’ll meet our very friendly and conversational staff members. You’ll see that the place is meticulously clean. You’ll just find that it’s a really non-intimidating place to work out. And you’ll see people from all walks of life trying to take either that first step or maybe they’re 10,000th step in sort of the fitness arena. Right? So we have a lot of different options available for folks. We have two different membership options. So, we have sort of what we call our white card or our classic and our black card, which has some other amenities tied into it for either ten or $22, or 21.99.

And but it’s just, it’s we’re completely different because we literally, and I mentioned this earlier as part of the conference, we pull people off the couch. Like, everybody says that they do that, but we actually do that. A good portion of our members have never set foot in a health club ever in their lives. And so, we’re their first experience. So, we try to break down those barriers. We created the judgement  free zone. No gymtimidation. And we just try to get people really engaged. And now we’re going down this road of trying to figure out how to provide even more resources and tools so that people can kind of engage in fitness how they want to.

For the most part our fitness experience right now is tied to a trainer and small group training, despite the fact we only have one trainer in the clubs for the 1000s of members that we have in each club. Moving forward, we kind of want to get it to more of a DIY, like, “I want to do it myself. Like how do I do that? What can you provide to me so that I can understand if I’m sort of a novice?” And that sort of thing.

Chantal:          Now I know a lot of people will have just heard what you said and kind of gone, “what? One trainer in the whole club?”

Brian:               Yeah.

Chantal:          Tell us about that model. How does that actually work?

Brian:               Yeah. So we have small group training, which is great. But we still find that a lot of members just want to come in and get on the treadmill and hit quick start, or go, right? So they do that. But we do have our passionate group-based fans. So they come in and they work with a trainer, and they can do functional training or they can do some muscle group specific stuff, and things like that. We also have a 30-minutes circuit that really is tailored to the beginner. So it’s ten steps, it’s ten selectorized machines, and so it’s got a cardio component, it’s got a strength component. You just oscillate back and forth. And it’s great. And a lot of people go there. We kind of call that sort of our safe haven for those folks, because it’s off the floor, it’s off the main floor, and so that they can kind of be by themselves and engage in fitness that way. But yeah. So, I think we, but we also offer a lot of different types of equipment.

Chantal:          Yeah.

Brian:               Generally only from one particular vendor in each club though, which is great. So, everything’s kind of streamlined, it all sort of makes sense. You don’t have multiple different experiences, the consuls and things like that, everything, you can kind of understand how it might operate like that. And it works really well for our members, I think, so.

Chantal:          That’s absolutely fascinating. I find it amazing when you are talking about having a lot of members in the one space, that you got just that one trainer working with them. And obviously, you found a way to make it work because you have referenced several times the fact that the gym environment is that, I love the word gymtimidation.

Brian:               Yeah. No gymtimidation.

Chantal:          I haven’t heard that before, the no gymtimidation. And you kind of called it a safe space and everything else like that. So, you’ve obviously been able to create that, but just with the single staff member.

Brian:               Yeah. But so, that programming though, to your point, is not particularly scalable. Right? So, when I think about scaling the fitness experience within Planet Fitness we really do look to technology. And so it’s and I think I’m always quite careful about this, Craig is as well. It’s not technology for technology’s sake, it’s technology for scale ability’s sake. Right? So how can we offer that same group-based experience, maybe on a monitor in the functional training area that one individual can walk up and take advantage of and they feel like they got the same experience that they might have had with the trainer. And obviously I think there’s always added benefits of working with a really engaging trainer, someone that’s really passionate about working with members and stuff. But if you’re intimidated about doing that because you’re going to be working out with five strangers and then a trainer that you also don’t know, why not give them an alternative? And that’s what we’re trying to do.

Chantal:          Amazing.

Brian:               And you can do that through mobile too. Right? So, there’s a lot of different channels.

Chantal:          Yeah. And I wanted to circle back to the market research piece that we were touching on earlier because I was asking you about how recently creating that platform that you were speaking about, and you had talked about the fact that a lot of research had gone into getting you to that point. For anyone that is interested in kind of diving into those analytics for their own customers and in their own business, how did you get to that stage? Did you work with third party businesses to do that research? Did you do it internally from head office? Can you explain that to us?

Brian:               Yeah, so we have a couple new executive team members. One is Roger Chacko, who is now our chief commercial officer, and so he kind of covers strategy and marketing and sales functions, corporate partnerships and those sorts of things. And then we have Craig Miller who’s our chief digital information officer. So he kind of covers technology and really all things digital. And so, the two of them have both gone through this customer segmentation and journey work and stuff with other brands that they’ve worked with in other industries. And so they were really well versed when it comes to the key players in this space. So yes, we did work with third parties, third parties that they had recommended that they had confidence in, that had done really good work for them. Craig had been in the financial industry before and he had been sort of on the retail side of food and beverage. And then Roger comes to us from, he was in, I think hospitality and a number of other areas. So, they just have really, really diverse backgrounds and hadn’t done this work before.

I think it would have been a much tougher road to hoe is we didn’t have them come in and say, “Hey, here are the key players. Let’s do a sort of an RFP process of select the best ones and then we can move forward from there.”

Chantal:          Yeah. I think we’ve been talking a lot today in the Motion Soft Tech Summit about data and having comprehensive data that is usable, and not so much that it’s overwhelming and not usable. Just to give us a little bit of an understanding, when you were talking about your customer profiles and you were saying you have a really in-depth understanding so that we know just how in depth that is, if you pulled up the average member of a Planet Fitness, what sort of information do you know about that person? Like how intimately can you describe that person?

Brian:               I think a lot of that research is still a level up from that. I mean it’s still, we’re again, the segmentation is all about trying to identify these large groups of consumers. So like okay, we have this millennial crowd, but within that group, what are some of those individuals looking of maybe from a technology perspective, experiential? How do they expect to be onboarded? That type of thing. So, it’s still a level up from that. I think we want to get into sort of the individualization, the personalization. That’s ultimately the goal, and I think everybody wants to do that. But it’s still just sort of saying, “Hey, here are these logical groups. These groups are trying to accomplish different things.” And I think through predominately like really robust survey data we can kind of identified what those things are, and then we can attribute different journeys to that using all the different channels. So, whether it’s web or mobile, what kind of marketing messaging is appropriate even outside the club?

And then once they come into the club, what is the experience that they’re looking for? Are they someone that does really want to just focus on cardio? Do they want to do something related to strength? Are they more about sort of mind body? Do they want to take advantage of the black card amenities? [inaudible 00:12:57]do they just want to come in and use the massage beds? I mean, I think you can sort of try and determine that at sort of a high level. And then once you do that, there are other third party companies that you can bring in that will look at a lot of other data sources like Facebook and social media and all those, and then you can pair all that information together and start saying, “Okay, now what is this particular individual want?”

And I also think you can take advantage of things like quick polls. So, if you had somebody that does a workout in mobile, for example, you can do ask them very simply at the end of the workout “Was this appropriate for you? Did you feel like it was, did you have a good experience?” And those sorts of things. You can do these little quick polls, and it can really kind of help you determine what that individual should do next. So, if they liked it, they thought it was great, well let’s serve them up something similar, but slightly different, so that they get the same kind of experience and they have the same kind of reaction.

Chantal:          Brian, I’m keen for you to, I guess, look into the future a little bit to the time that the platform is fully integrated to the time that the mobile solution is available. If you were to put yourself in the shoes of one of your members, what does that experience look like at that time? What is that seamless experience look and feel like for a Planet Fitness member of the future?

Brian:               Yeah. I mean it’s, there’s a lot of different journeys that someone could go through. I think the way I look at it as sort of the health and wellness guy, right? So, I think okay, we have today our fitness experience revolves around trainer facilitator, trainer-led small group training. That’s our fitness experience. And so, if you don’t want to do that, you’re kind of on your own. Right? So moving forward though, we want to take all these sort of [inaudible 00:14:42]. So we want to take mobile. We want to take in club digital displays. We want to take connected equipment. Whatever that means. You can look at the cardio equipment. There’s even connected strength solutions out there. We just heard from eGym and some others and obviously Matrix has something out in the market, Technogym, others. And then you can also look at what people are doing outside the four walls. So like, “Oh, do I want to track my nutrition? Do I want to do something in mindfulness? Do I want to communicate with like-minded people even outside of the club, and  through the club platforms that are offered?”

So, I think what we want to do is ultimately kind of mash all that together, and then I sort of use this term a lot, like kind of the choose your own adventure. Right? So, like what path do you want to go down? I think ultimately mobile is kind of central to a lot of those different experiences because it really is the engagement hub at the end of the day, and it’s something that you’ll have at home and in the club. So yeah, I like sort of the choose your own adventure model. And but just to have more than one or two options, we’ll have several options and then letting you kind of figure out what works best.

Chantal:          I love that description, the choose your own adventure model – one of the things that you touched on there was the mindfulness piece. And we were having a chat earlier because I know that you mentioned that your head office is in a partnership with Headspace. And on the show, we in the past have talked about the benefits of mindfulness in like a day-to-day practise. Some of the leaders that come and speak on the show talk about the fact that that is something that is instrumental to their success. So, I’m interested in understanding what was it that motivated the team from Planet to introduce or to go into partnership with Headspace. And what does it mean for the business? What does it look like?

Brian:               Yeah. I mean, I don’t know that I can speak all that well about it because I’m not, because it’s really a marketing partnership and they kind of handled it. I can only imagine that, I think we all know that Headspace is probably the number one meditation app out there. And so, they’re kind of the leader when it comes to mindfulness. They have a great app. It’s fairly intuitive to use if you have a minute or two or ten minutes, like you can engage with it. So, that’s great. And so, I’m not entirely sure how that came to fruition, but I do think we want to have, we kind of want to look at wellness more broadly. But I would also say this: We’re not entirely sure. So, I think the logical next step could be, oh, do we want to integrate that into our mobile experience that we’re creating? The caveat to that is we don’t necessarily know that our members want that yet. Right?

So, that’s why this partnership, it’s kind of early on, it’s at sort of the corporate level at this point. We haven’t really pushed it out to members in any significant way, because we want to find out if our members are yearning for that first, right? If they are, then it’s probably an easy decision to make. But we don’t know that yet. So, we want to make some data-based decisions. It’s not like Brian’s way. It’s not Craig’s way. It’s not PF Corporate’s way. Okay, let’s find out what our members want through this consumer and market research and then make the right decisions based on that. So, and a lot of ties, a lot of the research is just validating. We were already thinking that way, and now we just validated that we were correct. Well, great. Or it could be oh, we were thinking that and we were proven completely wrong. And that’s great learning too. So, I think we’ll figure it out before.

Chantal:          I love that you brought it back to that just coming back to the customer, what is it the customer wants. And I think this is a good opportunity to remind you all that it doesn’t matter what size your business is. Regardless of what size it is, you can always do some type of customer feedback. You can always talk to your customers and find out what it is that they want before you launch the new product, before you invest in that new retail department or whatever it is. It doesn’t matter if you’re a standalone personal trainer or if you’re a multi business franchise owner, or a big box gym owner. It is just absolutely, it’s such an important piece.

Brian:               Well, I would also say too, take advantage of your staff or go into the clubs yourself. Right? So, sometimes we’re really disconnected at PF HQ, so it’s like we could go into the clubs and we do have our staff members just go around and talk to people, and find out what-

Chantal:          Simple, right?

Brian:               Yeah, right. Like I think we’ve spent a good portion of the time here talking about customer segmentation and journey work and meeting, working with these third parties and presumably probably paying and enormous amount of money for all that research, but at the end of the day you can also just go talk to your members. And you can talk to them one-on-one. You could do like a focus group and things like that, and those are great too. But that still takes planning and organising and all that kind of stuff. You just go talk to people or just even, that’s taking a step back from that, just watching people interact. Like oh, they got on the piece of cardio equipment. I remember I heard an example the other day, somebody got on one of the elliptical at one of the Planets and started doing the elliptical, and did a 20-minutes workout and never hit start. Like, never actually hit start. Like never actually turned the machine on. And it’s because you don’t have to, right? You can just get on and start doing it.

Chantal:          You can do like, yeah.

Brian:               You don’t have, so they never actually turned the console on at all. And it’s like that’s really interesting.

Chantal:          Yeah.

Brian:               And that’s not, I’ve heard that happen in other clubs as well. And it’s like, well yeah. You can’t necessarily do that with the treadmill, but you can certainly do it with the elliptical.

Chantal:          Absolutely.

Brian:               It’s like oh, or the bike or whatever, right?

Chantal:          Yeah.

Brian:               So it’s like oh, okay. So.

Chantal:          It’s funny because it really is just getting back to basics. And I always think that quite often some of the best people that you can ask, and you just mentioned staff then, it’s like your welcome desk person probably sees more stuff going on in the fitness facility or the personal trainer that you’ve got in the middle of the floor probably sees more stuff than HQ ever would, so.

Brian:               Yeah. Right, right.

Chantal:          So Brian, I want to finish off today because I think it’s important that we always stay up-to-date with what’s happening from a tech perspective. And one of the things that you touched on earlier which I love is that you had gathered information, you had looked outside the industry for information to kind of feed the actions that you’re doing in the business. So, can you leave us today with three ways that you would suggest that we can keep up-to-date with data and technology trends from, kind of the broader world essentially?

Brian:               Yeah. I mean I think what I use. I mean, I use LinkedIn a lot, so I’ve lots of connections. Many of them are in the fitness and nutrition industries and things like that. And a lot of them are actually in digital health too because I worked in digital health for a couple of years. And so, it’s great. The people are always posting really interesting information, they’re posting podcasts or links to this, or the fitness technology council. There’s all kinds of things in there. So, LinkedIn is great. MobiHealthNews is fantastic just kind of as a summary of the day’s activities or-

Chantal:          Is that M-O-B-I?

Brian:               Yes, correct.

Chantal:          Yeah.

Brian:               Yeah, related to technology there’s a lot related to digital health. And oftentimes fitness, they’ll post about, there’ll be stuff about Planet or Soul Cycle or Peloton and what they’re doing or the new cool [inaudible 00:21:33] app, or whatever it is. So, that’s fantastic. And then, let’s see, I had a last one.

Chantal:          Is it outside the industry? Conferences?

Brian:               Conferences.

Chantal:          We talked about conferences.

Brian:               Conferences are critical. Oh, and just Google Alerts, right? So, yeah.

Chantal:          Oh, Google Alerts is a great one.

Brian:               I mean Google Alerts is fantastic.

Chantal:          Yeah.

Brian:               Just type in what you want to know on the app and then all of a sudden you just get this stream of information. Obviously you get inundated at some point.

Chantal:          Yeah.

Brian:               But yeah. And definitely just get involved.

Chantal:          Yeah.

Brian:               Like go to IHRSA go to IDEA come to MotionSoft. Come to the conferences. Meet with the folks. The thing I like about MotionSoft is that all of our “competitors” are here, and we’re all talking openly kind of about sort of what we’re doing and all the secrets are kind of left behind, right? So it’s like you sort of open the kimono a little bit and just kind of talk about it find out best practices and things like that. So, there’s no better forum for-

Chantal:          T’s for the greater good of the industry at the end of the day.

Brian:               Yeah.

Chantal:          And I just want to touch on really quickly, because I know that there are half of you that are going to automatically know what Google Alerts are all about. But just in case there is anyone out there that hasn’t set up a Google Alert before or if you’re kind of going, “What is that?” I just want to tell you really quickly because it’s one of the best and quickest things that you can possibly do, and you are literally just going to, I think you type in Google Alerts to bring it up. And you are going to put in there, I do a few things: I put the business name, I put my competitor’s name. So I set up an alert for our business name. I set up an alert for our competitor’s name. And then any topics that I’m interested in. And it doesn’t ping you all the time. You don’t get bombarded with spam. But to means that when there is something relevant to you then you’re going to get a push notification and then you can read that article. So, it’s a really nice way to receive information.

Brian:               Yeah.

Chantal:          Great. Brian, thank you so much. I think you can relax now. You’ve done all of your speaking gigs and your interviews for today. So, thank you so much for coming on and chatting to the FBP family. We really appreciate your time and thanks for sharing that information with us.

Brian:               Yeah, thank you for inviting me. I’d love to do it again.

 

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