Once known as a musclehead mecca, Gold's is reaching for a bigger share of the $16 billion industry by marketing itself in a kinder, gentler, fashion: as a health-and-fitness center for everyone from babies to baby boomers.
"We must evolve," said Gold's Gym Senior VP-Chief Marketing Officer Joe Flanigan. "If we stay exactly where we've been, soccer moms and boomers move on and we remain a brand with nice black-and-white photographs of when Arnold [Schwarzenegger] used to work out there."
A weighty proposition
With rivals such as Bally Total Fitness and 24 Hour Fitness edging closer to its lead, Gold's is leveraging its $30 million ad budget with a print, TV, radio and internet campaign featuring the tagline "Change Your Body. Change Your Life." Executions, created by independent Riester Agency, Phoenix, include a senior citizen lifting weights and a woman in a lap pool, among others.
Without completely trashing its 41-year history and tradition -- in fact, it's keeping its iconic logo of a chiseled bodybuilder with a sagging barbell -- Gold's is walking a fine line. It wants to trade on its experience in the field but at the same time lose the perception, found in its own company research, that the brand is viewed as a place where bodybuilders craft their physiques and intimidate anyone else trying to work out.
"The bottom line is -- and this is what we told the franchise system -- the trick here is to fully leverage the expertise and authority platform we have while minimizing the musclehead/intimidating factor," Mr. Flanigan said. "We have 40 years of heritage, but I believe you can rebrand yourself."
So does Ernest Lupinacci, a former creative with Wieden & Kennedy who worked on the ESPN and Nike accounts and is now the creative director of Ernest Industries, New York. "There's a distinction between your gesture and your aesthetic," he said. "Their aesthetic isn't trying to bench press a Ford minivan. Their aesthetic is physical fitness, but at one point in time, that manifested itself in bodybuilding. I would argue that in the market space, Gold's Gym has great brand equity, and what they have to do is convince people of the proficiency they have in fitness."
|Source: International Health, Racquet & Sportsclub Association|
The health-and-fitness-center industry is, well, healthy. Between 1995 and 2005, U.S. health-club memberships rose 71% to 41.3 million, according to the International Health, Racquet & Sportsclub Association. The number of clubs that opened nationally in 2005 jumped to nearly 29,000, up 21% from 2004.
But the industry is highly fragmented. The 50 largest companies -- which include Gold's Gym, 24 Hour Fitness, Bally's Total Fitness, Lifetime Fitness, Curves and LA Fitness -- hold only about 30% of the market. Nonprofits, such as the YMCA, operate more than 5,000 of the 29,000 clubs.
Gold's had $1.2 billion in revenue last year from its 620 clubs, including 500 in the U.S. Bally Total Fitness had $1.05 billion from 361 units, and 24 Hour Fitness had $1 billion from 340 units.
An earlier hurdle for Gold's was that its advertising and marketing were also fragmented; franchisees sometimes weren't on the same page as corporate. "People were doing what they wanted. There was no control from a brand perspective," said Cody Pierce, Gold's Gym director-franchise marketing, who came onboard with Mr. Flanigan two years ago when TRT Holdings bought the franchise. "We had to step up and provide franchisees a good, solid marketing calendar with good promotions."
Gold's was also losing out on the 55-plus crowd. Health-club memberships in that demographic have increased a whopping 265% in the past 15 years, according to IHRSA. Gold's Gym membership from those 55 years and older was 7%, compared to an average of 25% overall, according to IHRSA.
To that end, Gold's has increased its alliances with various groups, including the American Diabetes Association, to associate its brand with "life-changing" causes.