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Obesity and health clubs - Essay Example

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Contents Situation Analysis 2 Market Size and Value 2 Market Trends 2 Obesity 2 Public and Private Health Clubs 2 Distribution 3 Virgin Active’s Competitors 3 SWOT Analysis for Virgin Active 3 Strengths 3 Weaknesses 4 Opportunities 4 Threats 5 Segmentation: 6 Profile Criteria 6 Geo-Demographic 6 Psychological Criteria: 7 Behavioral Criteria 7 Positioning 8 Situation Analysis Market Size and Value The health and fitness club market has experienced a rise between 2006 and 2011, with a 17.3% increase in value to ?…
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Obesity and health clubs
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Download file to see previous pages The reason for this could have been due to the rise in membership fees, which account for 75% to 85% of health club earnings. An alternative cause could be that health clubs are spending less than before, which accounts for a decrease in company expenditure. According to a report by Mintel (2011), the health and fitness club market has 5.33 million users, and as previously mentioned, this figure is predicted to increase with the upcoming Olympics. Market Trends The health club market has had some positive turns due to increasing awareness of obesity problems, and negative turns due to the economic crisis. Obesity In the UK, the high rate of obesity is a very serious problem that requires action to be taken. The following statistics by Keynote (2011) are obesity predictions for 2050: 60% of men, 50% of women, and 25% of children. This is a very large percentage of the population. In 2010 (confirm year), the government created a scheme in England called ‘Change4Life,’ which aimed to change the lives of the population of England by altering diet and exercise habits. This public encouragement of exercise could have influenced the rise we now see in health club use. Public and Private Health Clubs However, due to the current economic crisis, it is becoming difficult for health club members to pay the annual fees. In addition, as people are looking to decrease spending, health clubs are likely to be considered unnecessary during hard times, despite member loyalty. With an increase in government spending on health and welfare, public health clubs have seen improvements and increases in available resources. However, this does not benefit private health clubs like Virgin, which rely on membership numbers to generate profit. Distribution Health clubs provide a service in exchange for payment of membership fees. Some clubs also charge a joining fee. Once fees are paid, members can utilise the facilities as they please within the timeframe they have purchased. Health clubs often have an additional system where consumers can pay less for access to fewer facilities. At health clubs, members can also purchase items like water bottles or food, and often health-related products such as protein shakes and powder. Virgin Active is a chain of health clubs with 194 locations throughout South Africa, Italy, Spain, Portugal, Australia, and the United Kingdom. As of April 2011, Virgin Active had 69 health clubs in the UK, with a total of 265,000 members; this averages at 3,841 members per club. The fee to join a Virgin Active health club ranges from a monthly fee of ?50 to ?90. Virgin Active’s Competitors According to Mintel (2011), the leading fitness and health clubs in the industry in 2011 were: David Lloyd with 450,000 adult members, Virgin Active with 419,000 adult members, Fitness First with 400,000 adult members, DW Sports Fitness with 250,000 adult members, LA Fitness with 215,000 adult members, Bannatyne Fitness 180,000 adult members, and Nuffield with 150,000 adult members. After Virgin Active’s purchase of the Esporta business, the company moved into second place; ...Download file to see next pagesRead More
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