By David Arthur Walters
The Miami Mirror
June 09, 2011
MIAMI BEACH – What in the world will become of Crunch Fitness under the leadership of fitness industry titan Mark Mastrov? A McCrunch franchise operation! Yes, what we see here is the McDonaldization of Crunch. At this writing, ten franchises have opened and scores more are in the works.
Mastrov’s favorite model has always been the fast food business, as can be observed in his previous development of 24 Fitness. The main advantages of standardization are speed, uniformity, and cheapness. In the interest of making a profit after paying a hefty franchise fee, local staff must be kept to a bare minimum; wages must be kept almost as low as McDonald’s; there should be no sales commissions. At the McCrunch franchises, millions of customers will eventually be quickly processed on the standardized machine- and workout-conveyor belts at exercise-on-the-go locations suitably clustered near their homes and workplaces all over the world.
Almost everything the franchise needs except capital will be provided by the franchisor, including, most importantly, the standard brand, as well as standard signs, marketing and advertising. As in times of old, everything will be done to entertain customers with music and theatrics, which will gain more attention that the service itself.
The aggressive sales-over-service characteristic of Mastrov’s notorious “churning and burning” approach to the market is evident in his efforts to seduce potential franchising prospects. He is marketing the Crunch brand as “the most recognized and respected in the fitness biz.”
The reason that “there’s no other gym out there quite like Crunch,” states the June 2011 online franchise presentation, is not mainly because of the service that Crunch provides, but because of sales techniques: “our unique approach to marketing ourselves.” A full-time, in-house advertising team will seduce the public into buying Crunch.
Once the fabulous advertising lures prospects into a Crunch gym, the facilities will sell themselves because “the Crunch brand is so compelling, because its No Judgment philosophy is so resonant and because the value it offers is so apparent, all that’s required to get people to join is to let them have a look around.” Therefore the sales staff will need neither commissions nor good judgment to make sales; they will be similar to lowly paid cashiers at the grocery store, so labor costs will be kept to a minimum.
Crunch’s No Judgment philosophy – Thou Shalt Not Be Judgmental – has plenty of superficial competition from 1,500 Planet Fitness franchises with over 2.5 million members in 40 states. Planet Fitness stole the notion from Crunch and registered it as its “Judgment Free Zone®” concept. Actually, Planet Fitness, the so-called Wal-Mart of gyms, is one of the most judgmental fitness organizations in the country due to its etiquette code banning what Crunchers like to do most: wear whatever they want, slam down or drop weights, make ass and grunt whenever they feel like it – Planet Fitness terminated a member for grunting and had him arrested for his objections to the judgmental policy. Please, please ban cell phones or loudmouths! Planet Fitness is a lucrative, cheap knock off of Crunch in several respects; now Crunch can have its revenge and McCrunch it.
Crunch’s No Judgments philosophy aims to please customers as individuals, therefore there is no general goal, like health and fitness, pushed on the members. Why alienate customers? Just give them some tools that you happen to like and let them do what they want with them: “At a Crunch gym there is a premium placed on individuality because Crunch recognizes that there is no one type, no one way and no one goal.” That is why “the Crunch brand inspires loyalty and elicits trust. “More people join Crunch and, once they’ve joined, they stay.”
"No matter the economic climate, fitness-based businesses continue to post profit as consumers view a gym membership as a necessity, not a luxury," disingenuously said Jim Rowley, formerly of 24 Hour Fitness, now CEO of Crunch. "Our goal in offering Crunch franchise opportunities is to accelerate the growth of this unique entity and to share the Crunch experience with as many people as possible."
Rowley did not mention Crunch’s troubles under insolvent Bally, or how Crunch, after it was purchased from Bally, went into bankruptcy to dump unsecured creditors and investors and emerge with the same people in charge – the judge in the case was infuriated by the abusive process, and the trustee was appalled by the conflict of interest initially undisclosed by the law firm. Rowley, who did not respond to our request for his comment, did not bring up another kind of conflicted interest: the risk of the company-owned operation going broke again if the discounted-price franchise stores were allowed to compete with it; or the possibility that a franchise organization with many owned operations may devote most of its attention to them to the disadvantage of the franchisees. Nor is mention made of the actual decline in membership or the attrition rate in the industry over the last five years. Well, while others languished, Life Time Fitness appeared to thrive during the downturn, but that is believed to be due to its family model. Indeed, some industry experts believe the Crunch model is way beyond mature, that it is moribund and shall soon be extinct. May Heaven forbid its demise, for we love the brand if not the management!
In any case, the “world-class brand” is marketed as synonymous with effective and fun workouts, offering a “world-class facility” at the “incredible value” of only $9.95 a month for the base membership, that being the price of the Domino’s large pizza special, or a little more than the best burger combo at McDonald’s; or $19.95 per month if someone wants the sizzle: “free access to our online fitness and nutrition program; free unlimited guest passes; free access to other franchise clubs; plus unlimited tanning.” What? Tanning? No Judgments!” Too bad unlimited bricks-and-mortar training is not included along with free vitamins and food. Or at least one training session per month or week might be included. And how about free electrolytic popsicles, free cups of protein drink, stuff like that?
Of course pricing may vary with markets and there are initiation fees and so on. We hear that Crunch is hard at work to help supply the demands of the “booming industry” for franchises. We see that San Diego’s El Cajon Crunch franchise, the tenth franchise to date, is selling memberships at $9.95 or $19.95. Here is the press release: “Crunch El Cajon will offer everything that makes Crunch unique, including innovative classes like BodyWeb w/TRX, Bosu Bootcamp, Zumba and yoga, just to name a few. The 20,000 square foot club will also feature top-of-the-line equipment such as Precor, Octane, Star Trac, Hoist Roc-It and Free Motion, tons of free weights, expert personal trainers, an online fitness and nutrition program, Hydro Massage and tanning beds. All of these valuable offerings, including locker rooms, shower facilities, and convenient parking, will all be available for an unbeatable price of only $9.95 – $19.95 per month.”
No experience is required to buy a Crunch franchise. Do not worry about managing a fitness club. Although “franchise” is a word rooted in “free,” the franchisee will need to be told how to manage the operation. The “world-class” management service to be provided by the franchisor is likened to a weapon; the franchise comes “armed with a management team that’s made up of some of the most successful people in the field.” Imagine having household names like Mark Mastrov, Jim Rowley, and Mike Feeney, the “current team of professionals shaping the world of fitness, media, and sports one brand at a time,” drop by your gym to tell you how you should manage it – perhaps a DVD might do – better yet, set up an online university.
Guess what, the “world-class team of fitness professionals” will help you get the money, the real estate, and the equipment you need; of course you must take all the risk. We wonder if anyone will be paid commissions on any of that.
And we wonder why everything must be “world-class.” Is not America the leader of the first world? Do we then need to be demeaned or world-leveled? We may not have invented fast food, but we invented McDonalds and Stabucks! Well, perhaps what is meant is that the Crunch brand is destined to become McCrunch, a global brand that will suit any class in the world.
Caveat emptor: demand to see the financial details of an actual working model, and read the disclosure and contract very carefully – Crunch’s franchising office did not respond to our request to examine the standard provisions set forth in its documents so we may educate the public on what to expect from its world-class team of fitness professionals and lawyers.
All that being said, a McCrunch system of stripped-down gyms properly situated could growly rapidly throughout the world, and certain franchisees could prosper mightily. What does it matter if half of them fail as long as more come on line? Should not one be fit to survive? Then may the fittest survive; that is what evolution does, hopefully: select the fittest. Never mind the “debasement” of the brand. A brand takes on a life of its own, and can mean something much higher than what exists.
Long live the brand! No one including myself has loved the Crunch brand more than Donna Cyrus, well known for bringing innovative, cutting-edge workout programs to Crunch. We see that she is onboard the franchising operation, i.e. listed at one of its leaders. Hey, if they keep the classes, minimize the number of expensive machines and the space needed for them, provide free coffee and McCrunch brand snacks, offer a little office with free internet, and learn how to train people to please and keep customers, everything might work out for the best in this best of all possible worlds.