2012 UK Low-cost Gym Sector Report

THE UK LOW-COST GYM SECTOR IS ADDING SOME MUSCLE RESEARCHED AND WRITTEN BY RAY ALGAR MANAGING DIRECTOR, OXYGEN CONSULTING, UK Definition of Low-cost Gym MINIMUM 50% PRESERVICE OPERATE LOWER THAN THE AVERAGE 24 HOURS INDUSTRY PRICE POINT OPERATING PHILOSOPHY CAPABILITY TO GYM - LED OPERATE ENTIRE PROPOSITION CLUB WITH A SINGLE PERSON Market Drivers for Low-cost Gyms CONSUMER SENTIMENT TOWARDS LEGACY CLUBS DIGITAL INFRASTRUCTURE SIMPLICITY SPORADIC ATTENDANCE AT LEGACY CLUBS AFFORDABILITY CHANGING CONSUMER Strategy canvas for a Low-cost v mid-market health club HIGH 100 90 80 O Low-cost gym 70 Mid-market health club 60 MEDIUM 50 40 30 20 10 LOW OPENING HOURS SALARIED STAFF PRICE ONLINE CLUB WEB & RANGE OF SELF JOINING DESIGN TECHNOLOGY FACILITIES SERVICE CORE COMPETITIVE FACTORS the . CONSUMER INSIGHTS – gym THE GYM GROUP RESEARCH www.thegymgroup.com Main motivation for exercising at The Gym Group 60% 50% 10% CURRENT 56 22 10 MEMBERS PREVIOUS 55 22 10 MEMBERS MAIN REASON 40% 20% 30% Would members recommend The Gym Group? 10 9.2 8.4 8.5 7.7 7.1 SCALE AGE GROUP * AGE GROUP FEMALES MALES ALL WITH HIGHEST WITH HIGHEST MEMBERS RECOMMENDATION RATE (66+) RECOMMENDATION RATE (56-65) PREVIOUS MEMBERS CURRENT MEMBERS How long did previous members keep their membership? UNSURE MORE THANA YEAR 16% 7-12 MONTHS 18% 128% 4-6 MONTHS 0-3 MONTHS 1 33% SCALE MEMBERSHIP 0% 5% 10% 15% 20% 25% 30% 35% DURATION LEADING PRIVATE UK LOW-COST BRANDS Timeline showing year brand launched YEAR BRAND LAUNCHED NIZ 2006 NIZ 2009 NZ 2010 NZ 2011 ZN 2008 ACTIVE4LESS FIT4LESS |TRUGYM KLICK FITNESS FITSPACE THE GYM GROUP FITNESS4LESS GYM4ALL PUREGYM XERCISE4LESS Leading UK Low-cost brands – number of clubs RANK RANK E RANK RANK 4 RANK 29 CLUBS 24 CLUBS 23 CLUBS 12 CLUBS 9 CLUBS PURE GYM Owner Pure Gym Ltd THE GYM GROUP FIT4LESS FITNESS4LESS ACTIVE4LESS Owner The Gym Group Owner énergie Fitness Owner Fitness4less Owner Active4less Holding Ltd JOINT RANK RANK RANK RANK RANK 9 CLUBS 18 CLUBS 16 CLUBS 15 CLUBS 14CLUBS XERCISE4LESS Owner Mr Jon Wright KLICK FITNESS FITSPACE GYM4ALL TRUGYM Owner Fitness First Owner FitSpace Owner Gym4All Owner truGym AT SEPTEMBER 2012 TOTAL 129 Forecast for UK Low-cost gyms Most frequently used monthly membership price - all clubs 200 -225 GYMS YEAR END 2013 150 GYMS Kercise4less 19 99 YEAR FiRsiess FISpace truGym Pure Gym The Gym END 2012 19.99 Prices correct in Segtember 2012 Brand name 19.00 18.99 1799 Gymdall 1699 Active4Less 15.95 Fitness4less 1499 16.99 Klick Fitness 15.99 SOURCE: UK LOW-COST GYM SECTOR REPORT, RAY ALGAR, OXYGEN CONSULTING, 2012 READ THE FREE REPORT AT: OXYGEN-CONSULTING.CO.UK CONTROL EXPERIENCE 000 PERFORMANCE VEB USE YAND W HEALTH 00000 O APPEARANCE TANTECHIS Oilolle SCOPET STRATEGIC EMPHASIS