Core Collective

Market

Target market

Core Collective sits at the convergence of recent trends in fitness, nutrition and social behaviour driven by the millennial generation, who now represent the largest demographic segment in the UK. Fitness revenues from gyms in the UK have grown by over 5.4% to £4.3bn during 2015, while there has been a 37% increase in the number of boutique fitness studios during 2012-2015. We feel that this growth has been driven by consumers’ desire to have flexibility in spending decisions, and the ability to make spontaneous purchases, both of which are counter-intuitive to the concept of a committed gym membership. As highly active social media users, many millennial consumers tend to be social in their choice of fitness activities whether it be a spinning class, TRX, high intensity interval training, pilates, or yoga. Furthermore, many millennial consumers are very conscious about the foods they consume opting for fresh simple and healthy choices.

Characteristics of target market

We believe that these millennial consumers have shown a preference to make spontaneous purchase decisions and are therefore less likely to commit to long term gym memberships, preferring pay as you go models and using mobile technology to search for and book their fitness activities. As avid social media users, over 37% feel they are ‘missing’ something if not active on Facebook, Instagram or Twitter each day. Therefore, its not surprising that over 56% prefer to exercise in a social setting. Over 55% of millennial consumers ranked brands that stood for high quality as being the most authentic while 53% would rather spend money on experiences instead of possessions.

Marketing strategy

Core Collective has an in house marketing team which manages all aspects of increasing the brand reach, developing the strategy, and very focused on delivery. Brand values of Core Collective are aimed towards fulfilling the needs of consumers, with a large proportion of customers being female:

• Flexible – with numerous class times and ways to book customers can buy discounted packages of classes and use them when they want, or book through Class Pass subject to availability. Under 30’s and corporate users get discounted membership rates;
• Simple – the four main fitness classes on offer are simple enough for beginners yet designed to challenge the most experienced customer;
• Social - all classes have a social element, as does the design of Core Kitchen. ///
• Effective – recent data indicates that over 56% prefer to exerise in a social context, and we feel that socially based classes are more effective than traditional gym membership, and that working out with others pushes them to try harder.

Social Media Marketing is a central avenue of customer acquisition. We encourage customers and advocates to use hashtags such as #keepitcore #corekitchen and @coregyms the spread of the brand can achieve greater reach among its target audience. Core Collective also invests a significant amount of its own internal resource to posting informative content on Instagram about new trainers, food choices, and classes. These type of posts tap into the ‘aspirational’ aspects of sharing fashion, food, workout regimes, and healthy living.

Competition strategy

Whilst there are dozens of boutique fitness studios in London, many have lower quality facilities and average trainers. Core Collective offers a premium, high quality product putting itself in competition among only a few others. Differentiating factors in Core Collective are the in-house ‘star’ trainers whose classes have high booking rates as well as the premium build quality of its studio, facilities, equipment and luxury amenities. Core Collective counts a number of celebrities and fitness influencers among its regular clientele.

Given recent trends towards healthy living and historical fitness industry performance, we believe that Core Collective will be resilient to economic downturns, benefiting from reduced competition for the leasing of prime sites on favourable terms. A number of prime, high-traffic sites have been identified in London.