Process optimisation before digitalisation
According to the key figures in a recent industry report, more than 76 percent of fitness companies want to invest in digitalisation. This figure is even higher than in the previous year. Today, there is hardly anyone left who questions the worth of automation processes. Now that this question has been answered, however, many people are having difficulty answering the follow-up questions: where to act, and how.
Usually, the first thing to be considered is digitalisation of the training area – after all, training equipment that is linked to the internet, digital training plans and modern, database-linked test systems for trainees all offer trainees the opportunity for professional and modern training, while also allowing trainers to maintain a focus on their clients. By further professionalising their service, premium facilities hope to more clearly set themselves apart from discount providers. New target groups should be reached, and the average monthly fees should be increased, or at the very least kept level.
From a business standpoint, the focus is on increasing – or at a minimum safeguarding – overall revenues when determining whether or not to invest. People too often forget, however, that operating results depend not only on sales figures, but also on costs. And it is on the cost side that digitalisation processes offer enormous optimisation potential: the areas of administration, membership management, sales, service and food services in particular offer undreamed-of potential..
Analysing and optimising work processes
Optimising costs while maintaining the same high standards of quality for service and training is the order of the day. While this may sound like an impossible task, digitalisation is opening up new capabilities that bring this goal within reach. Here, digital operating concepts that allow the automation and optimisation of processes are the key.
However, the negative thing about the software systems, hardware components, access control systems and/or end customer applications (apps, log-in areas etc.) that must be acquired is that their mere acquisition does not automatically reduce costs or optimise work processes. Instead, it remains necessary that the decision-makers begin by closely scrutinising the work processes that have been in force within the company to date. These must be questioned in their entirety and changed wherever necessary and – if possible – completely overhauled through the use of modern, digital solutions.
There are a number of questions that decision-makers have to ask before purchasing any digital solutions or equipment: How do I envision my studio in future? What do I want to achieve, and how much effort and expenditure will I actually save, by introducing this or that innovation? Will I be saving working hours or material costs, or will I be able, for example, to reduce my sales or marketing expenditures?
Without conducting a critical analysis of the current work processes and developing a clear plan for the future in advance, it will be increasingly difficult to successfully lead companies into the future. The operating environment is subjected to unceasing change, yet many of the work processes currently in use still have their roots in the pre-internet age, and these are usually unable to satisfy the requirements of the digital age. When someone attempts to change this using today’s digital technology, this is referred to as the digital mobilisation of the company.
A practical example
Let us take a look at an example scenario that provides us with a clear look at the form such a digital mobilisation might take. In our scenario, the primary focus is on reducing sales and marketing costs.
In a conventionally operated fitness facility, an online and social media advertising campaign (e.g. Facebook marketing) is carried out to generate leads that must subsequently be followed up by specially trained sales staff. These leads are usually contacted by phone or email and invited to take part in a consultation / sales talk. The working time that must be allocated for this purpose is at least 30 to 45 minutes. From those potential customers who come to the consultation, a well-trained salesperson is able to close a sale in approx. 70 percent of cases; when the talks are conducted in a professional manner, it is also possible to generate additional leads through personal recommendations.
If someone is looking to further optimise this process, there are a variety of digital tools available for increasing sales rates with varying degrees of success or raising the productivity of sales staff. The weakest, or rather least certain, link in this chain is the employee, and the success or failure of these efforts depends on their skills and dedication. Yet companies are finding it increasingly difficult to obtain trained, motivated and, in particular, talented persons to perform these tasks. At the same time, the hourly costs of employees are rising incessantly, swallowing up a not-inconsiderable portion of the sales they are aiming to generate.
The task here is to create a new underlying structure for membership sales, and to do this, it is necessary to scrutinise and revamp the entire process from the ground up. If this is not done, any investment in delivering a digital solution will be wasted. It is clear that it is not easy for an entrepreneur to have to question or do away with long-standing work processes. It is a move that requires courage, vision, an entrepreneurial mindset and action.
What form might this take in our example? Potential customers found through online campaigns would no longer be taken to a landing page, but instead end up directly in the studio’s online sales tool. This makes it possible to create an entirely digital process through which potential customers can be directly transformed into studio members. Costly and annoying processes disappear almost overnight: call centres, long sales talks, filling out paper contracts, monitoring the working hours and performance of sales staff, manual entry of contract details into the system etc. – not to mention the time involved in finding, training and developing suitable personnel.
Making memberships available at any time and anywhere
This creates a new channel for customer acquisition – one that consumers are already familiar with from other areas of life: people buy clothing, book flights or even entire vacations online – why not fitness studio memberships as well? An intelligent digital strategy puts customers in a position where they are able to take out a membership at any time and from anywhere using their computer or smartphone. Here, it is mobile solutions that are most important. Even if this strategic decision yields ‘only’ 30 to 40 percent of their new clients online at first, it is a move that considerably reduces the load on studio management, and it allows sales and marketing personnel to use the time they gain for other, possibly more profitable activities, including occupational fitness and collaborations.
Once the person responsible has made this fundamental decision to enter into the online sale of memberships, they are immediately confronted by the next round of decisions and necessary process optimisations. Companies need to take an extremely critical look at their own websites and ask themselves if their websites are actually informative and if they have really been optimised for sales – will potential customers who visit their sites be interested in joining their studio, even without ever having seen it from the inside?
In the next step, there has to be a sales tool that is customer-friendly, self-explanatory and directly linked to membership management, so that new contracts do not require any other administrative processes. In addition, this tool must be good enough that it is able to cover the entire online sales process attractively and quickly. It must also be legally sound and feature optimised processes. Studios will be compared here with large online providers such as eBay, Amazon and other professional online shops, as this is where consumers have ‘learned’ how online registration and online purchases should take place today.
The example depicted here makes it clear just how important it will be in future to examine and optimise all processes in a fitness centre wherever possible, as sales is not the only area in which potential optimisations can be found. One could easily find just as much room for improvement in food services, membership management, aftersales processes and human resources planning.
Regardless of the area being considered, the following rule always applies: to obtain the desired results, work processes must be thoroughly examined before any digital solutions are implemented. That is because digitalisation can only maximise its contribution to a company’s commercial success if all of its processes are properly integrated, without any isolated applications, so that customers can experience the new digital processes as an improvement, rather than as a deterioration in service and a move towards greater anonymity.
Because this is an area in which the fitness industry is markedly different to the world of online business: direct and personal contact with customers will always play an essential role here. Digitalisation must support this, rather than take its place. It should make it possible for employees to be even closer to their customers, without generating additional costs. Providing good customer service while simultaneously optimising costs leads to positive operating results, regardless of the entrepreneur’s positioning.