The best fitness business of all time?

ABOUT THIS ARTICLE

Gym World comes from Kilo co-founder John Franklin, who shares lessons about making money in the fitness industry.

It’s definitely not what you think…

Happy Sunday Gym World.

My 16-month-old son ate two remote controls this week, and I have the receipts to prove it:

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You haven’t lived until you’ve troubleshot a TV with Cocomelon stuck on full volume.

Enough Dadding, let’s dance.

Is Zumba the best fitness business of all time?

After selling 25 million DVDs, Zumba announced this month that they’re returning to the consumer product space.

Their new program combines fitness, nutrition, and accountability.

It’s called the “Zumba 6 Week Transformation Program,” and is primarily marketed through Facebook and Instagram ads.

Here’s the landing page:

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Right now you might be thinking:

“A dying fitness brand is doing a 6 week challenge, so what?”

And while I agree that Zumba isn’t as trendy as it once was:

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It’s a MONSTER business that every fitpro should study.

We have more locations that teach Zumba than Mcdonald’s, Starbucks, and Dunkin’ Donuts combined.
Zumba founder, Beto Perez

Zumba’s business model

Zumba instructors are Zumba’s primary source of revenue, and while they hold the exact number a secret, a 2019 BBC article says that “there are more than 100,000” worldwide.

Instructors pay $400 to get a 1-day certification that qualifies them to teach Zumba.

The certification is good for 6 months unless the instructor joins the Zumba Instructor Network (ZIN), which costs around $40-$50/mo.

A 2012 article by Inc. says that 85%-90% of instructors join the ZIN, which means Zumba is likely generating $50M+ in recurring revenue just from the ZIN.

The ZIN provides instructors with licensed music, choreography, business tips, and a Facebook group. It also makes it easier for Zumba to sell instructors additional training and certifications.

A quick look through the instructor database shows that they have their upsell process dialed in.

“Licenses,” “education,” and “milestones” are prominently displayed on every instructor’s profile, and most instructors are more decorated than the average military general:

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(two profiles from the Zumba Instructor database)

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So here’s what the full funnel looks like:

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My guess is that Zumba is okay with spending the cost of the 6 week program in ad spend because it gives them fresh leads for their instructor business.

What can gym owners learn from Zumba?

Lesson 1: Don’t reinvent the wheel

Zumba is rumored to be worth around $500 million.

They can build any landing page, craft any ad, and try any offer.

YET they choose to do a 6 week transformation program and advertise on Facebook and Instagram, just like thousands of other gym owners.

Why are they doing this? Because it works.

Lesson 2: Make it easy for people to do business with you

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Zumba puts the payment information and the buy button above the fold.

They offer a payment plan to make starting more affordable.

If you prefer to buy over the phone, they give you a phone number, & I guarantee they’ll answer it if you call.

Lesson 3: Upsell, upsell, upsell

Dan Kennedy said, “the business that can spend the most to acquire a customer wins.”

Zumba is likely okay with losing money on this offer because they’ll make up on the backend.

How can you get comfortable doing something like this?

You need to know your numbers. I guarantee Zumba knows:

  • What % of users become instructors
  • What % of instructors join the ZIN
  • How long someone stays in the ZIN
  • How much money each ZIN member spends

This information dictates how much they can spend to acquire a new customer. The more each customer is worth, the more they can spend to acquire one.

Lesson 4: Sell the dream

Their instructor marketing focuses around making money doing what you love.

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This ad has 1.5M views and is almost a year old. Pro tip: If an ad has a lot of views and has been running for a while, it’s probably a winner.

Check out this block from the instructor sales page. It makes the $400 investment seem like a no-brainer:

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Lesson 5: Every cult needs a cult leader

CrossFit had Glassman.

Bikram had Bikram.

Zumba has Beto.

Beto founded Zumba in 2001, and he is still the face of the brand today. Despite being 52 years old and incredibly rich, he’s active on social media and still coaches Zumba classes.

Keeping a fitness concept relevant for over 20 years is insanely difficult. You have to applaud the man’s focus and consistency.

But hey, if this was my job, I could probably grind it out for 22 years:

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But wait, there’s more.

In 2012 Ari Emanuel, the real-life version of Entourage’s Ari Gold, took a stake in Zumba and has turned the company into a powerful music production and distribution company.

Zumba has produced over 500 songs and collaborated with Timbaland, PitBull, Vanilla Ice, Shaggy, Don Omar, & Daddy Yankee.

And why TF wouldn’t they?

This press release announcing a partnership with Daddy Yankee explains the benefits well:

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Zumba classes are done by more than 15 million people each week, and the music instructors play is heavily influenced by Zumba.

This makes Zumba one of the largest music distributors in the world.

And while I wish I could give you insight into how much money this part of the business makes, I have no clue how the music business works. But thanks to Dan Uyemura for the tip.

The CRAZIEST stories from running gyms in NYC

This week on Gym World, Mateo & I sit down with Jay Wein to swap some of the craziest stories from our gyms in the New York metro. The first segment is NSFW, so if gym gossip isn’t your thing, skip to 30:18.

Until next week,

JiB

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