Customer-Facing Mobility Strategy Has Three PillarsBy Jim Nash | Posted 05-30-2012
Bally Total Fitness Gets Its Mobility Strategy Into Shape
No one has ever accused the health and fitness industry of ignoring a perfectly good fad. New equipment, diets and weight-loss methods develop seemingly out of nowhere, like bubbles in a (zero-calorie) soda. Whole fitness philosophies can be erased like lessons on a chalkboard, to be replaced with new instructions (also written in chalk). So it should come as no surprise that this agile industry would be a target-rich environment for enterprise mobility, dense as it is with potential customer-employee interactions that often can be deep and last months and sometimes years.
Several months and $300,000 into a limited rollout of a broad mobile infrastructure, the 1 million-member Bally Total Fitness chain of upscale gyms has decided that enterprise mobility is no fad. In an interview with CIO Insight's Jim Nash, the company's SVP and CIO Guy Thier says he is confident that mobile devices will reduce member turnover, cut operating costs and increase membership sales.
Ten of Bally's 100 clubs have at least some aspect of the mobility infrastructure right now, and those early adopters have seen an increase in membership sales. Thier says the very fact that clubs are always trying new things makes it hard at this point to say exactly how much new revenue is attributable to the mobility strategy. He is, however, confident enough to say that such sales will pay for Bally's initial $300,000 mobility investment by summer 2012, when the company's first mobile deployments turn one year old.
Bally standardized on Apple iPads and iPhones running either Verizon or AT&T to avoid having to deal with multiple vendors and operating systems. The devices -- about 50 iPads and 100 iPhones -- run a mix of internally and externally developed apps. Based on early results, it looks likely that most of Bally's 1,900 employees eventually will be toting mobile devices at work.
CIO Insight: Describe what enterprise mobility looks like at Bally.
Guy Thier: Our vision is to really impact the entire enterprise, from consumers to employees. We have several pillars supporting our internal mobile strategy. Under one pillar, we're putting mobility into the hands of salespeople and general managers to support interactions with customers.
We have a custom iPad membership app that enables our sales staff to sell right there on the floor. No more touring a club and going back to a little office to get the person to sign a contract. It sets a tone right from the start of a membership.
People check into the system when they come in, so we have good idea of who's in the club. Staff can view each customer's profile, including a photo and the person's goals. Our people can stop by, offering workout tips. They could also discuss how one-on-one training could help that person hit their goals.
There's an employee/operations pillar for the strategy too. Bally has an iPhone app that tracks and manages work orders for preventative maintenance, repairs, parts. It logs activities for later retrieval.
Part of our strategy also covers back-office functions. We have virtual desktops on iPads that are used primarily by IT, and have helped us to cut floor space by 50 percent for IT. That initiative started with allowing staff one or two days away from the office, and we saw improvement in productivity. It expanded to four days working from home with hoteling. That's a very attractive [employee] retention tool, too.
Is it BYOD at Bally?
Thier: We buy the devices for employees, and we hand them out to people who we really want to encourage to go mobile [such as] executives. If you compare clubs with iPads to clubs that are still on PCs, it's less expensive to work on iPads because the tablets are less expensive than PCs to buy, deploy and maintain.
How's your budget for app development look?
Thier: With partnerships, it's not too bad. We have the user experience-piece and the transactional piece. We use an outside vendor -- Magenic -- to develop the user experience.
You outsourced the user experience but not the behind-the-scenes work?
Thier: Right. We are more familiar than a third-party vendor could be with integration points between the multiple systems [managing employees, sales, member databases, etc.] that already exist in the enterprise.
With your focus on one hardware vendor -- Apple -- have you considered developing a mobile enterprise app platform?
Thier: We're moving toward it. One advantage is standardization and another is the ability to deal with employee turnover.
What's standing in the way?
Thier: It's a matter of priorities for the company. If I could do it all over again, I'd be even more focused on standardization from the beginning.
Customer-Facing Mobility Strategy Has Three Pillars
Do you have a mobile offering for your clients when they're working out in your fitness clubs?
Thier: Our [customer-facing] strategy has three pillars:
There's consumer interaction with the [health club] environment. We put QR codes on equipment to help customers learn how best to use it. Customers at some clubs can also use an iPhone or iPad app to order a drink from the juice bar while they're working out, shower, dress and then pick it up on the way out.
Then there's consumer-to-employee. For example, we have a client-management app for personal trainers. It helps them help customers to reach their goals, which is important to retention.
And we're in the early stages of consumer-to-consumer interaction. [One early project] would enable members [using an iPhone or iPad app] to see who's in the club so that they can work out with a friend, and working out with a friend generally encourages people to stay active in a club. We could really play with this one. I could see competitions between friends or teams within clubs or maybe even club-to-club competitions.
Dating seems like the ultimate consumer-to-consumer interaction at a fitness club.
Thier: We're trying to stay away from that. We want to avoid the whole meat market stereotype.
If your mobile strategy is or could be invisible to your customers, would they notice the difference between pre-mobile and mobile?
Thier: Yes. First, the sales process is so different. The [health and fitness] industry is based on the car-lot experience, where you show someone what they're buying and then you bring them back to a small room. It can be high-pressure.
Second, the culture in a [health] club that's mobile is very different from other clubs because staff can relate to members more directly, which, again helps keep members. They know more about a customer's goal and how the customer is doing, and so they can support them in an individual way.
How difficult is it to get staff to adopt the mobile strategy?
Thier: Newer staff are adopting mobility because they don't know another way. But established sales staff might have certain rhythm to how they sell. Some are used to the confrontational style, like selling a car.
Overall, we've seen slower adoption in clubs that we switch to mobile than we would have liked. When you first put iPads in a club, you can watch the progression of sales done on an iPad. The first week, you might have, say, 20 percent of sales completed on mobile devices. It keeps climbing, but plateaus at maybe 50 percent. It takes effort to get to 90 percent or 100 percent use in converted clubs.
You hear about how mobility will alter all aspects of enterprise operations, but is that possible? Are there areas you see that will always be unaffected?
Thier: I wouldn't go so far as to say all aspects of our business will be mobile someday. There are just some functions that don't allow you to get away from sitting behind a desk. We have a subscription model, and there will be Web and some self-service capabilities, but there won't be wholesale change here. I'm talking about back-office tasks like billing.
But consumer-facing interactions will see a big change. Ninety percent to 100 percent of those will be mobile.
The fitness industry is burdened -- or brightened -- by its trendiness. It rolls out new machines, techniques and programs all the time. Is mobility another example of this?
Thier: I've met with a lot of my counterparts in the industry. Most of the fitness folks are shying away from [it] at this point, and I'm not sure why.
Fitness clubs are capital-intensive. If you're faced with having to put money into a new workout room or a new technology, the physical upgrade is chosen more readily.
Just seeing the cultures, before and after [our mobility rollout], I'm convinced. There are a few people who go to the club with headphones on, and who don't want to be bothered by anyone. But there are a lot of others who have a social experience in mind when they work out.
Can you see a day when you can demonstrate a measurable difference in club performance comparing those with a mobile strategy and those without?
Thier: Yes. It's already here. Member retention is up measurably in updated clubs. [It's] hard to say that it's due just to mobile, because we're always updating all parts of club. But our mobile strategy is a significant factor.
What are the rising tech trends that you anticipate impacting your mobile environment?
Thier: NFC [near-field communication] will. My first foray into that will be [allowing members to use] an iPhone or iPad to get in the club. Then I want to extend that out to making payments the same way.
When will you have a return on investment to show your board of directors?
Soon like two or three years?
Thier: Soon, like this year. It will be one year after we did the first club. That was July of last year. We're already building on that foundation.