The DOT.COMS have changed the rules and are
changing the way business is done worldwide.
Why is Yahoo a hugely successful e-commerce
giant with a corporate net worth ten times greater than Robert
Murdoch’s FOX NETWORKS?
Because Yahoo gives its service away FREE. And
what a valuable service it is. It's
FREE, no charge or obligation to buy anything. Ever.
How
DOES Yahoo Make Their Money?
By getting permission
from their happy customers to advertise other businesses products and
services to them. By establishing good will with their clients by
providing their services for free, Yahoo earned the right to make money
on advertising revenue and commissions for sales to other businesses. If
you haven't heard of affiliate programs, you will.
This business model has “EXPLODED” growth for all industries who use it's power! It is
not just another successful marketing campaign. It has changed marketing
and sales forever. The face of business will never be the same.
Hold Onto Your Head!
Very soon, the fitness industry will be flipped upside down,
so be sure your seat belt is tight!
(*Get the book “Permission Marketing” by
Seth Godin seth@permission.com )
This is a frightening thought for Gym owners
when they first hear about it.
"This won’t work in
the Gym industry!" they say. This may be the first that many of
you have seen or heard of this concept. It needs time to sink in and be
digested, but study it please. Because
the time will come where you must partner with it or be a ‘horse and
buggy’ on a super highway!
This is how a business model looks using
©FREE
Gym Membership Affiliate Strategy
PUBLISHER’S
NOTE: The following is FICTION.
However, those that are way ahead of the curve on ecommerce are
already envisioning a different health club world because of e-commerce.
Take for example MARK MASTROV, CEO of 24 Hour Fitness, the largest
health club chain in the world with nearly 400 locations. While speaking
to the attendees at the Global Industry Summit held at IHRSA in San
Francisco in March, Mastrov made a comment that shocked many in the
audience. He said, “In 5 years I would not be surprised to see clubs
providing memberships to the public for free!” Other leading edge
thinkers like the people at E-Zone Networks and Netpulse are already
ahead in the movement to “capture eyeballs.”
Steve Paterson is the Vice President of Sales for Used Gym Equipment.com,
a Southern California-based company whose business is buying Bank
repo’d fitness equipment. Remanufacturing
it and selling it to Gyms, Hotels, Schools and more.
UsedGymEquipment.com is the leading marketer of refurbished fitness
equipment in the world and Steve Paterson has used e-commerce very
aggressively for several years now.
While the article that follows may upset some readers, his writing
certainly gives new ‘food-for-thought’. In fact, contained within
the article are comments about the GymBusiness.com Group that are not
fictional and are actually taking place.
The
Publisher of The CLUB INSIDER News in no way endorses the notion of the
establishment of health clubs that provide memberships free to the
public. In a time where the approximately 60 year old health, racquet
and sportsclub industry is attaining credibility with the public that
permits memberships to be sold at a fair price for fair services
provided, it is the opinion of the Publisher that the “eyeballs”
sought by advertisers should be membership dues paying eyeballs.
However, Steve Paterson provides several viable concepts in his writing
that could easily help dues health clubs generate additional gross
revenues from their operations. In our opinion, therein lies the true
value of this FICTIONAL work and is the sole reason for the publication
of this article.
This is how a business model looks using
©Free Gym Membership
Affiliate Strategy
FreeGyms.com
is incorporated on November 20th in the year 2000.
FreeGyms.com open with 5 facilities in leased space within an 80-mile
radius in beautiful Southern California. Upon lease signing, the
business development process begins.
Business Equipment
Sponsorships
The first phase puts together 22 different
businesses that agree to buy all the fitness machines needed for each
location and give them to FreeGyms.com. The agreement with these
businesses is they pay for the exercise machines and FreeGyms.com mounts
a nice gold plated plaque that is 3" x 3" on each exercise
machine. This plaque
promotes the sponsoring business and gives their phone number and
website address. The agreement states that these plaques will stay on
each machine for at least 3 years.
The benefits to each sponsoring business is 3
years of exposure to the local members who will use each machine over
100 hours every month. These participating businesses write off the
fitness equipment cost as a marketing expense in year one. And get 3
years of exposure at no additional costs.
Free Membership Campaign
The next phase is member recruitment. Of course
FreeGyms.com does not have a sales staff. So they use 2 very effective
and cost free methods to harvest members by the thousands.
The first strategy is Public Relations or Free
Press using Paul Hartunian’s steps to free press (call 973-509-5244 to
get your free report on PR). Very quickly local magazines, newspapers,
radio shows, and local tv cable channels want to do a story about the
FreeGym.com, the company giving away thousands of free memberships to
anyone over 21. The local tv news and the CNN local edition reporters
race frantically to be the first to cover the story.
3 tv news helicopters circle over the 5 locations on opening day.
The other method to harvest members is also very
effective. Over a 30 day
period FreeGyms.com contacted 500 local businesses and gave each
business gift certificates for a FREE year gym membership at any of the
5 locations. These businesses were instructed to give these certificates
away to all of "their" own customers. These 500 businesses
give away an average of 50 free one year memberships every week and
bring in about 25,000 FreeGyms.com application requests every week
leading up to the grand opening.
However, there are restrictions to this free
membership. Members have to
be over 21. And everyone
must fill out the membership application correctly and completely before
their membership card is issued. To be approved, the member must agree
to be targeted by FreeGyms.com business associates. And this application
has 33 questions about lifestyle, buying habits and income level. If any
part of the form is not completed or if the marketing waiver is not
signed, the application for the FreeGyms.com membership is declined.
At opening day FreeGyms.com has 25,000
applications authorized and approved and after 2 weeks 100,000
membership cards were issued between the 5 locations.
Needless to say FreeGyms.com was the talk of
Southern California. Which was the plan because this publicity leads
FreeGyms.com into their next (most important) strategy.
How FreeGyms.com Makes
Money
The next and most important step is how
FreeGyms.com makes money. They do so by building partnerships with
businesses who sell products and services to customers like FreeGyms.com
members. Since 5% of the new FreeGyms.com member's are local business
owners, it made this task much easier.
FreeGyms.com members that are local business
owners are met with individually by FreeGym.com’s executives. The
co-op marketing philosophy behind giving away a free gym membership is
carefully explained. They explain why they give this very valuable gift
away. They relate the new member’s agreement that they must accept
the advertising efforts by FreeGyms.com business associates while
in the clubs. They
explained how these participating businesses have sponsored their free
membership. And, they explain that to guarantee that this free gym
strategy continues, the members are asked to buy the products they need,
from these affiliate businesses. They explain to the potential business
associates how this free gift strategy links to basic human emotions.
After the affiliates understand the potential marketing and sales
benefits to their business, they rapidly signed up to be partners.
The most creative and interesting part of this Free Gym Membership
marketing strategy is the partnerships and the variety of methods for
producing income for FreeGyms.com and generating sales for the business
associates involved in the program.
PROFIT CENTERS FOR FreeGyms.com
Following is a brief description of 5 key profit
centers used by FreeGyms.com and the associate partners.
1)PROMO
PAK- Every month a Promo Pak was mailed to each member at home. This
Pak includes over 100 coupons, free samples, brochures, 2 for 1 specials
and an assortment of offers, all promoting FreeGym.com Associate’s
products to FreeGyms.com members.
The charge for each business was $325 per
location each month.
The members were excited to receive the PROMO
PAK every month because of all the coupons and special offers. This Pak
generates approximately $130,000 in PROFITS every month between the 5
locations.
2)INDOOR
BILLBOARDS- Another profit generator is indoor billboard
advertisement. FreeGyms.com utilized an interior design expert to create
large colorful frames that hang on just about every available wall space
in each gym.
Inside each frame is a colorful (poster size)
billboard ad promoting each participating business. The Billboards are
done with creative design and congruent colors and are very appealing to
the eye.
Each billboard ad generates $600 per month and
there are 340 billboard ads between the 5 locations generating $204,000
in profits every month for FreeGyms.com.
3)RETAIL
LOBBY SALES- The next affiliate strategy is a mini trade-show in the
lobbies of all 5 locations at FreeGyms.com. FreeGyms.com rents table
space to 4 different businesses at a time (in each location).
The tables are placed just off to the side of the front
desk/lobby area. The members could easily walk past these promotions or
simply take advantage of the special offers for the week.
The lobby tables generate $500 each per week per
table. 4 tables in each location contribute $8,000 every week in
revenues or $40,000 every month for all 5 locations.
The lobby vendors have one representative seated
to answer questions and hand out brochures and coupons to interested
members. This low key presentation is successful due to the traffic flow
passing the front desk.
4) GymBusiness.com
Group - Another very profitable affiliate strategy is accomplished
with a profit generating company called the GymBusiness.com Group. (deborah@gymbusiness.com
)
GymBusiness.com Group brings in profit
generating products and trains FreeGyms.com staff to sell these products
and health related seminar courses.
They come in with the motive to "make FreeGyms.com make more
money from the members they already have".
********************************************************************************
(Publisher’s
Note: This segment of this article is NOT
FICTION. According to Deborah Golden, President of GYM.BUSINESS.Com
Group, “A gym is like any other business. It has to make money to stay
open. We’ve designed multiple packages, including weight management
and women’s workouts, that any club owner can use to service members
and make money doing it. Our number one ‘Business Within A Business’
offering is the Individualized Nutrition Technology (INT) Weight
Management System. This premium computerized system was developed from
years of scientific and medical research to allow true and accurate
weight management based on the extensive history of individual oxidative
typing. INT is an easy ‘turnkey’ system that can be installed for a
minimal initial investment. INT maximizes revenues for club owners.”
Golden adds, “The projected annual INT revenues for just 300 members
is $250,000 and taps into the $60 billion weight management industry.”
Jim Ciarlo, owner of the World Gym, Cherry Hill,
New Jersey, has added INT to his gym and comments,”I am broadening my
business horizons with marketing methods and systems from the BGC Group.
I no longer have to rely only on new members for revenue.” Ciarlo also
plans to install the GBC Group’s prepackaged women’s workout center
in a 1500 square foot space in his gym.)
********************************************************************************
The GymBusiness.com Group profit generates
programs on average of $25,000 every month per location. This provides
$125,000 in gross profits every 4 weeks between the 5 locations.
5) The
Gift Shop Affiliate Strategy- This service is a big hit and huge
time saver for the participating FreeGyms.com members. When the gyms
were designed a 1,000 square-foot Gift Shop was included adjacent to
each lobby area.
All the products and services available at the
gift shop are on-line at the FreeGyms.com Website.
The members can order on-line gifts for all occasions. The gifts
are gift-wrapped for free and packed and shipped for the members who
receive a 15% discount off retail for the items they ordered.
There is also a catalogue that allows members to
buy products from affiliate partners on the FreeGyms.com Website. Or
they may order items when they came into the gym. The gift shop serves
as a pro shop too and sales and special offers are emailed to all the
members providing sales to 70% of the members who rarely (or never) come
into the gym.
The FreeGyms.com gift shop became a big hit and
sales are $100,000 every month at each location. This produces gross
profits of nearly $200,000 every month on sales of half a million.
FreeGyms.com has 200,000 members 90 days after
opening. They have a very attentive audience because they have provided
thousands of local residents and businesses with a free gym membership.
These members feel more obligated to make purchases from you. This magic
formula weaves all these strategies together and brings in profits
faster than you can hire accountants to count it.
I have shown you 5 affiliate program strategies
that generate profits. There are over 100 methods known today.
FreeGyms.com will generate $12 million dollars in gross PROFITS at the
end of the first year without ever selling a gym membership!
I think you can agree that this business model
shows potential to say the least.
Now the next question is what fitness chain is going to make the
first move? Will it
be called FreeGyms.com, FreeFitnessCenters.com, or maybe
FreeHealthClubs.com. Or will the winner be the club chain who doesn't change their
name but changes their whole business model and implements the Free Gym
Membership Affiliate Strategy.
Nobody knows at this stage of the game. But, I
predict that you will hear about gyms using this marketing strategy
before the Club Insider News publishes the January 2002 issue.
(PUBLISHER’s
NOTE: We repeat. This article was based entirely on FICTION with the
exception of the introduction written by Steve Paterson and the segment
marked by ***** describing the GymBusiness.com Group.
We also want to add that in no way does The CLUB INSIDER News
endorse or support the concept of giving away free health club
memberships in an industry that has labored for 60 years to earn the
right to market memberships to the public at a fair price for fair
services rendered. We have published this article simply to illustrate
the extreme range of ideas represented by the DOT.COM World. Where the
health, racquet and sportsclub industry goes from here in the DOT.COM
World is truly
impossible
to predict and this article is simply the vision of one individual that
makes his living in the industry using extensive e-commerce marketing
and sales efforts. To contact Steve Paterson go to Sales@UsedGymEquipment.com)
www.UsedGymEquipment.com