Structure Market plan for Pure Gym
Case study based on Mintel “Health and Fitness Clubs UK 2021” August 2021 and IBIS “Gyms and Fitness Centres in the UK” March 2021, and January 2022 Following forced gym closures throughout 2020 and early 2021, virtually all gym members either had their memberships frozen or opted to cancel. However, it hasn’t taken long for the majority to reactivate their memberships with 58% returning to gyms as at June 2021, while most of those yet to unfreeze their membership planned to return in the following 12 months. One in four consumers said COVID-19 has made them more interested in taking part in leisure activities that benefit their physical wellbeing. The pandemic has altered consumers’ purchasing habits in the long term. Younger consumers have become more financially aware and are more likely to favour cost-effective options. Just over 1 in 4 16-24s who have a membership or are interested in joining the gym would prefer a discounted off-peak membership, whilst a quarter would prefer the pay-as-you-go payment option.
The main threat to the private health and fitness industry is the potential for future lockdowns. Online fitness services served consumers very well during gym closures and higher demand for these services will be one of the main legacies of the pandemic even now gyms are open again. Moreover, government initiatives aimed at tackling inactivity and obesity are expected to increase industry operators' potential customer base. Competition is forecast to intensify, with low-cost and luxury gyms capturing market share from mid-market facilities. Demand for outdoor fitness continues to grow as consumers seek safe ways to exercise and a change of scenery. Fitness operators should continue to focus on enhancing their online and outdoor propositions in order to offer best ‘hybrid memberships’ that offer access to both online and offline services, including outdoor facilities.
In the following report, the market plan is going to be structured through the analytical perception of the macro-environment. According to the MBA Assignment Experts, Through the Pestle Analysis, the factors are going to be observed which are affecting the growth of Pure Gym. Furthermore, Porter's five forces will ensure the micro environmental factors that will provide evidence to the information that will be collected. Then the consumer decision-making processes will be verified to study the internal environment through SWOT analysis.
Importance of Pestle Analysis
The Pestle Analysis dispenses circumstantial resources regarding the business flow. The brand positioning can also be determined from the analysis along with favorable growth in the required areas and examine the risks involved in the field of productivity (Cieślikowski & Kantyka, 2018). The sustainability of the available services and products can also be derived from the analysis and endorsements of new products can also be developed.
Political: The effects of the Covid - 19 have made the UK government protective for personal development for which Pure Gym was highly affected (Chand, Lal Prasad & Mamun, 2021).
Economical: The high inflation rate and interests have brought major changes in the daily lives of the people but Pure Gym invested its potential in innovating its services (El Khateeb & Shawket, 2022).
Social: The major changes that took place in renovating the trends to expand the low-cost segment attracted a huge percentage of customers in the youth demographic.
Technological: The advancements made in the technicalities were to raise awareness of being fit and influenced many customers to go to Pure Gym. The demand of low cost gyms by the consumers in the UK is represented in the graph mentioned below.
Figure 1: The demand of low cost Gyms
Source: (Glofox, 2022)
Legal: The various resourcing by the UK government has forced people to be involved in activities to lead a healthy life which has enhanced the growth of Pure Gym (El Khateeb & Shawket, 2022).
Environmental: Pure Gym maintained high sustainability to maintain a healthy environment by maintaining their low-cost segment to attract more customers.
Pure Gym is one of the highest low-cost gym chains in the UK offering low-cost subscription fees for members. The members of Pure Gym are free to come and go as Pure Gym has no contracts that restrict consumer willingness (Dick et al., 2020). They are very particular about maintaining hygienic factors and cleanliness. The quality of services that are provided by Pure gym is always accessible.
Michael Porter’s five forces model is required for the understanding of the competitive constraints in workplaces in any industry. The importance of this tool is to yield manufacturing or work-related processes under constant pressure (Bhatt & Singhi, 2020). The affected competition in the working environment reflects the increment in the profitability of the business.
Porter’s Five Forces Analysis
Competition in the industry: The competition in the market is reasonably high due to the Gym group in the UK has also a wide chain and popularity (Chiu, Kokkinis & Miglionico, 2021). The flexibility in the low-cost segment in the gym sector affects the debt management proactively (Mintel, 2022).
Potential of new entrants: The factor of Pure Gym to lead in the market of the United Kingdom makes fewer ultimatums for the new entrants which are a positive impact for Pure gym (Abeysiriwardana & Jayasinghe-Mudalige, 2021). The below graph is representing the growth in the fitness industry in the UK.
Figure 2: Fitness Industry growth
Source: (Statista, 2022)
Power of suppliers: The gym sector hardly requires any supplies in products which reduces the power of suppliers as Pure Gym also relies on services mainly. The infrastructural technicalities were provided by Pure Gym which caused changes in the behaviour of the staff (Shin et al., 2021).
Power of customers: The power of the customers is very moderate as there is plenty of availability of consumers due to the low membership costs of Pure Gym.
New entrant threat: Though the registration fees are low Pure Gym never compromises with maintenance and customer satisfaction is one of the main aim by innovative technology (Gocłowska, Piątkowska & Lenartowicz, 2019). They also have various online services that have increased their businesses by 97% in the post pandemics.
‘Pure Gym’ has personal trainers who are certified with the appropriate skills, abilities and knowledge to maintain an effective and safe programme of exercises. It helps the customers to achieve fitness and health goals. The membership packages of this gym are very low in the UK as fitness and leading a healthy life was the dedication of the peoplein the post pandemic (Tanisawa et al., 2020). There is so much flexibility in service which is provided by the outdoor and indoor activities of Pure Gym. The main focus of this gym is generating good gym experiences. Hygiene is significantly maintained by Pure Gym.
Star: Pure Gym has a star factor in the gym industry in the UK. The membership which is provided by this gym reports customer satisfaction in the business (Hamilton & Webster, 2018). The gym increased the volume of customers with personal trainers and a safe programme of exercises. It helps the customers to achieve fitness and health goals.
Question Mark: There is high growth in some sectors and the share of the company is low which will be a question mark as fighting with the diseases calls for fitness training (Amagasa et al., 2022). The market share of certain products of Pure Gym is low but the market share of those products is relatively high which has to be identified. The technological aspect helps to grow a brand with better marketing (Moshrefi et al., 2020). The technological aspects of Pure Gym are moderate.
Cash Cow: The cash cow of Pure Gym is its various offers which will compel its clients to avail of its lucrative membership plans which will benefit both the gym and the clients (Zin, Bombana & Barcellos, 2018). The easy and affordable membership plan of the gym will ensure clients hold on to the plan throughout the year.
Dog: The new facility that the gym chain is providing to its clients is the third space facility which will allow the clients to socialize often raises dilemmas regarding digital citizenship (Calzada & Bustard, 2022). This service will have a low growth rate in the market and it will not add value to the larger objective of the gym chain.
Figure 3: UK fitness gym centers after pandemic
Source: (Statista. 2022)
Importance of SWOT Analysis
SWOT analysis shares the internal capabilities and measurements of the given organization or center and provides its internal viewpoints.
Strength: Pure Gym is open 24/7 in the UK which attracts customers and structures the gym's market plan (Jing et al., 2021). It has a wide range of fitness skills that allows more customers to share their physical well-being.
Weakness: The biggest weakness for a UK-based gym is the inconvenient location and technical issues that challenges the customer allowance in the market (Polyakova & Ramchandani, 2020).
Opportunities: Affordable prices can lead to more customer visibility and pursuing training in covid crisis is the biggest opportunity for Pure Gym (Andreucci, 2020).
Threats: In recent times, online gym training and limited client basis has become the biggest threat for Pure Gym (Yin, Li & Dila, 2020).
Marketing objective (SMART)
The marketing objective is an important factor in determining the success of a brand that wants to sustain itself in the competitive market. Setting up specific objectives will ensure that the short, long, and medium-term goal of a company is achieved in a time-bound manner (Sugiat, 2021). After the covid, there is a different situation with consumers getting conscious about the financials and wanting cost-effective solutions.
Selection of objective: The SMART objective was selected as a marketing objective for Pure Gym. The immediate target is set in a specific and time-bound manner which is to increase the turnover to over 330 million pounds by 31st December. Pure Gym has also made a target of getting over a million members by the same stipulated time. The SMART objective will ensure that the target is relevant in today's environment and is gained on time (Santoki & Parekh, 2020).
The marketing objective that uses a SMART model sets a time-bound goal that will be easy to accomplish due to efficient planning. The specific model of the marketing strategy was used to take the logical step which will be relevant in today's environment.
Marketing strategy and STP
STP helps a brand target a particular segment with clarity. The commercial attractiveness of each segment should be taken into account before developing positioning for each product segment including a marketing mix for the sector (Huijsmans et al., 2019). STP is relevant to digital marketing which enables a company to tactical communication.
STP Analysis
Segmentation: Segmentation should be based on demographics and the interest of people in a particular location. The characteristics and the purchasing power of a particular segment should also be focused during making the marketing strategy (Ghahnavieh, 2018). There is a group of young people who are actively involved in sport and who may play at the national level who need to be physically fit using the right equipment.
Targeting: The target market should be fixed according to the forecast of revenues for each segment. Losing weight and having a toned body is the general fitness goal of this segment (Liu & Shan, 2021). People belonging to the 18-45 age groups will be particularly targeted as they are highly likely to be regular members and they will purchase various fitness-related products.
Positioning: The customer proposition of Pure Gym is disruptive which its biggest marketing strength is. The positioning of each product should be based on the particular segment targeting. The positioning will be mainly for the young clientele who are likely to spend more money on fitness.
Marketing strategy: Increasing popularity among the targeted audiences
The four dimensions of the Ansoff matrix are product development, diversification, market penetration and market development.
Penetration: Pure Gym is focused to penetrate the untapped segment which will boost its revenue. Pure Gym is using various digital marketing tools to go to the new sectors. It also has strategic alliances with other fitness centers and celebrity fitness influencers (Khajezadeh et al., 2019).
Market development: New products are promoted in different countries as a part of the strategy (Khajezadeh et al., 2019). Pure Gym is mainly focused in the UK now it is expanding internationally.
Product Development: The gym chain has already begun to give new offers to its clients based on attractive plans. It is focused on launching new plans and offers which will be aggressively promoted on social media.
Diversification: Diversification will be risky for Pure Gym which is expanding rapidly (Krupina, 2021). Existing products should be marketed heavily before diversifying.
Porter’s competitive advantage: Porter's generic competitive strategy includes cost leadership which will be applied to get a competitive advantage. The various changes were identified due to pandemic in the customer’s responsibilities (He & Harris, 2020).
Importance of marketing programme
Prioritizing a primitive video sharing on the gym training and physical fitness structure can be an accurate marketing program for Pure Gym. The shadings of customer reviews and their affective experiences in Pure Gym upgrade its market structure and acquire the marketplace (Yin, Li & Dila, 2020). Thus, the market program is important to analyze the UK’s gym training centers and current conditions before the customers.
Planned marketing actions
● The increase of customer allowance and sale of company (Yin, Li & Dila, 2020).
● To develop mental and physical health conditions (Yin, Li & Dila, 2020).
The above research paper provided a detailed marketing strategy and its plan for the popular gym chain Pure Gym in the UK. With the help of analytical tools like graphs and tables, various marketing models were discussed in the above research paper. Pestle analysis, SWOT analysis, portfolio analysis and STP models were discussed in the report. STP is based on the principle of effective marketing mix strategy and product position for each system.
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