Maxed Out Ep 4: SWOT Analysis Introduction

Maxed Out Ep 4: SWOT Analysis Introduction

Transcript

Welcome to the Maxed Out podcast, where we speak with amazing studio owners, marketers, ancillary services to discuss fitness, business, marketing, and mindset. With over six years of marketing experience, Maggie Benson has helped countless brick and mortar businesses dramatically increased revenues through strategic digital marketing. Now she’s combining her passion for health and marketing to help fitness studios around the world grow and prosper.

Okay. So welcome to another episode here at Maxed Out. Thank you for joining me and listening to me once again talk about what I love, which is marketing, but I know that can be a little bit boring, but I hope you’re listening because you’re here to learn. So today’s episode, we’re going to talk about something that unfortunately is a little bit dry, but it’s important. So we’re going to talk about it, which is the SWOT analysis. A SWOT analysis stands for strengths, weaknesses, opportunities, and threats. And it’s actually something that you usually put together when you’re doing a business plan. So if you had to get funding to start up your studio or anything like that and required the funding, the funding usually requires a business plan and a SWOT analysis as part of the business plan. The reason I’m bringing it up today is that it is foundational and it is important to know what your strengths, weaknesses, opportunities, and threats are compared to your competition in your area. And so I wanted to touch on that.

So the benefit of doing it is to know where you stand in the larger marketplace. Now, being a fitness studio, usually your marketplace is local because people actually come in person. But in the post-COVID world, lots of studios are going online. So that means you almost need to redo your SWOT analysis, to see where you stand on the national and international level. It will reduce your chance of failure to know where your weaknesses are, by understanding where you’re lacking and eliminating any potential hazards that could come on down the road.

So to do a SWOT analysis, there are templates all over the internet, it’s pretty simple. You just want to list your strengths, weaknesses, opportunities, and threats. So starting with our strengths, what do you do well? What unique resources do you have that you can draw on? What do other people see as your strength? You’ll hear me talk about, and I believe it was episode two, your unique selling proposition. This is your strength. So what makes you different? What makes you better than everybody else? There is one thing, every business has a strength. So what is it?

And then on the flip side of that is, what is your weakness? What do you need to improve upon? What do you not have resources to? What’s likely going to impede your studio from growing and gaining members? And some of your weaknesses you can find by comparing yourself to your competitors. So what are their strengths, are usually going to be your weaknesses.

Opportunities include, what opportunities do you have that are unique to you compared to your competitors? Well, I guess that’s not true. Let’s say if there’s an opportunity, your local city council agrees to have fitness classes being held in a local park, that’s an opportunity that is open to all of the studios, and then usually you bid on it. So opportunities, trends that you can take advantage of, and how can you take your strengths and merge them with an opportunity in order to make them better? I’ll mention too, in a couple of minutes, I’m going to go into a SWOT analysis of Gold’s Gym that I found online, to give proper context to all this.

And then lastly, what threats? So what threats could harm you? Pandemic, right? Now, most people probably didn’t see a pandemic becoming a threat, but it probably taught us all a really strong lesson, but it is a threat. So what kind of threats can harm you? What if the city council is planning on taking your residential area and making it more commercial? Would that become a threat? There’s a lot of benefits to having your fitness studio close to where people live. That’s a proven concept over and over again. So you either want to be where they work or where they live, if you minimize how long it takes for them to get you. And a lot of people will choose where they live over where they work unless it’s a lunch hour thing.

So what is your competition doing that could be a threat to you? What are other threats to your weaknesses that could be exposed? So this is an exercise that you need to be doing, I would say, almost annually, part of your annual checkup on your business and everything like that, is, do your SWOT analysis and see if you’re missing anything.

Going into an example, because we learn by examples and when we can actually see things in action, I found a great SWOT analysis of Gold’s Gym, and I’ll put it in the show notes. So we all are familiar with Gold’s Gym. They’re great, I want to say they’re a franchise, but don’t quote me on that. But let’s say just Gold’s Gym, we know who Gold’s Gym is. So what’s their SWOT analysis?

So starting with their strength. Their strengths are, they’re a top-class facility. You would agree with that, right? High-end equipment, quality trainers, spaciousness. They aim to be the best of the best. They have really good capital. So their infrastructure, rich operation, and lots of capital, which means that they can put that capital back into their facilities. They focus on great locations, which of course, I agree that a location for a gym wouldn’t make or break you, but there is also usually a cost for the location, right? But they focus on being in prominent locations, across leading cities, and through an established network of fitness centers to reach a wider audience.

They always and always only bring in qualified trainers. So again, they bring in the best and the best, and that is what makes them different and what their strength is. And then, of course, they’ve tied into celebrity endorsements, including Arnold Schwarzenegger, [Salman Khan 00:00:07:10], John Abraham, and The Rock. So those are their strengths.

But what are their weaknesses? One of its weaknesses is poor financial management. They’ve been focusing on revenue generation, but not focused necessarily on cost control, which leads to being cash poor, not necessarily a good thing. Underestimation of the competition. So they might be a premium player on the global market, but a lot of members don’t actually like those global gyms, they like the smaller, personalized gyms. So when you become global, you lose personalization and that just happens organically. So by being that global name, they’ve lost the personalization to the local markets. Excessive focus on individual training, but very little focus on classes. I would say that GoodLife has a better balance, especially for women, when it comes to the personal training and the classes, and they offer that cohesive membership model, whereas Gold’s Gym has pretty much focused on, I am a muscle monkey, so I’m going to say muscle monkeys, people who like to lift. So I like to lift, so I’m offending myself in saying that.

So what are some of the opportunities that Gold’s Gym has? So there’s a growing demand for fitness, although, in the post-COVID world that we’re in right now, fitness is a bit restricted because of local bylaws. So there’s a growing demand for fitness, but I would argue there’s a growing demand for online fitness. And from what I have seen, local independent studios have pivoted better than the brands when it comes to online fitness. That’s been my personal experience based on what I’ve seen. Value-added. So we talked about this. They need to add more, so there are more opportunities for them to not just be about lifting and weights, but adding diet, nutrition, and personal training, but also classes. And the other opportunity at a community level is, we are more and more concerned about our health and living healthier lifestyles, so that’s another opportunity that ties into the demand for fitness.

Unfortunately, the threat is that there are gyms everywhere. Apartment buildings have personal gyms. Many employers include some sort of fitness program on-site, or they partner with somebody. Even when I worked in healthcare at the hospital, they had a gym. They actually had a gym in the hospital that you could use whenever you wanted. They brought in yoga classes. They had a local yoga instructor that used to come into the hospital. And all of that was provided for employees for free. Actually, I think I lied. I think we had to pay something like $20 a year membership just to cover the expense of actually keeping the equipment maintained. But it was just a cost, it wasn’t like the hospital was making money off of it. But that is the problem. So how do you stay differentiated compared to that? And a lot of these, like Gold’s Gym, or a lot of that business model, one of the benefits is being 24 hours, they’ve gone to a 24-hour system.

So hopefully that gives you some ideas of how you can make a SWOT analysis and do it for your own business. Again, I strongly encourage you to do this at least once a year, especially as things like pandemics come into play. But it is really, really important to talk about. So I did make one lie, I didn’t talk about USP in episode two, it was, why people buy. My bad. Because next week I’m talking about your USP. So what makes you unique? Your unique selling proposition, i.e. how are you changing lives? So that’s going to be next week’s episode. So be sure to subscribe and follow me so you get the notifications when that gets uploaded to your favorite podcast listening tool, gimmick, app. Thanks, everyone.

We hope you enjoyed this week’s episode of Maxed Out. If you’d like more information on today’s episode, head over to our website at maxedoutpodcast.com. Or you can find us on Instagram @health.wellness.marketing.

 

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